Good morning,

Amazon is moving closer to taking control of nearly all of its US package deliveries, with the company projecting that its own delivery network could handle 88.7% of its US packages by 2029. The shift marks a major change in Amazon’s relationship with traditional carriers such as UPS and USPS, as the retailer continues building out its own logistics operation.

And, as always, we have today’s trivia question at the end of the newsletter. Answer it to get on the leaderboard, which we’ll publish at the end of the month.

Let’s dive into today’s edition.

Retailers are shrinking their product selections as higher import, transportation, and storage costs, along with U.S. tariffs, make sprawling product lines more expensive to manage.

Product Cut: According to a Wall Street Journal report, companies including Under Armour and Helen of Troy are cutting less-popular products and investing more in their bestsellers as they seek to simplify supply chains and protect margins.

Under Armour has cut more than 25% of its products over the past two years, while Helen of Troy has also trimmed its selection to reduce the impact of higher tariffs. Smaller businesses are making similar choices, with some shelving new products because uncertain tariffs, shipping costs and new supplier relationships make expanding their assortments too risky.

Big Picture: About a quarter of U.S. companies surveyed by professional-services firm British Standards Institution said they plan to reduce the range of products they sell over the next six months. The shift reverses years of expanding product variety, a trend accelerated by e-commerce.

The Federal Trade Commission and 22 state attorneys general have sued Amazon, alleging the company secretly inflated advertising prices and collected tens of billions of dollars from advertisers. The lawsuit claims Amazon manipulated the bidding process for ads on its website and mobile app, affecting about 1.2 million brands and sellers.

Key Details: The complaint alleges Amazon told advertisers it used a “second price” auction, in which the winning bidder would pay only slightly more than the next-highest bid.

Regulators say Amazon instead introduced undisclosed surcharges that pushed prices above what the auction would have produced. Amazon disputes the allegations, saying the FTC misrepresented its advertising auctions and relied on cherry-picked findings.

Legal Challenges: The lawsuit marks the third major federal case against Amazon in recent years, following the FTC’s cases over Prime enrollment and the company’s broader e-commerce practices. The latest action comes as Amazon’s advertising business continues to expand rapidly, growing 26% in its most recent quarter and generating nearly $69 billion in revenue in 2025.

U.S. holiday retail sales are expected to surpass $1 trillion for the first time this year, with sales projected to rise 4.5% year over year during November and December, according to Bain & Company.

Peak Sales: The growth would exceed the 3.5% increase recorded during the 2025 holiday season, although inflation is expected to account for more than half of the nominal increase. Online sales are expected to be the biggest source of incremental growth, rising 9% and accounting for about 60% of total holiday sales growth. In-store sales are forecast to grow 2.5%, roughly in line with last year.

Clothing and accessories are expected to be the strongest in-store categories, while 43% of consumers say clothing will be their largest holiday spending category, ahead of groceries at 37%.

Big Picture: Retailers still face pressure from high gasoline prices, tariffs, geopolitical uncertainty, weak labor force participation, and rising credit card delinquencies. At the same time, higher tax refunds, rising stock prices, and potential tariff-related price cuts could support spending.

Instacart has partnered with World Market to offer the retailer’s products through same-day delivery, expanding the platform further into home and lifestyle categories.

Key Details: World Market will use Instacart as its first and exclusive nationwide online same-day delivery partner, with customers able to receive orders in as little as one hour.

The partnership brings World Market’s assortment of internationally inspired food and beverages, home décor, furniture, and gifts to Instacart, with the company saying products will be offered without markups. World Market joins more than 2,200 retail banners already on Instacart’s marketplace.

Expanding Boundaries: The deal is part of Instacart’s broader push beyond grocery and into categories including home improvement, beauty, pet and wellness. The company recently added PetSense through an exclusive same-day delivery deal and has also brought retailers such as Tractor Supply and Academy Sports + Outdoors onto its marketplace.

Keurig Dr Pepper will sell its entire stake in Chobani, along with a manufacturing facility and warehouse in Pennsylvania, back to the yogurt maker for $925 million, as it reshapes its portfolio following its acquisition of JDE Peet’s. The deal includes $800 million for Keurig’s Chobani equity stake and $125 million for the Allentown facility.

What’s Happening? The sale is part of Keurig Dr Pepper’s broader restructuring after its $18 billion acquisition of JDE Peet’s in April. The company is also preparing to separate its coffee and beverage businesses into two publicly traded U.S. companies. Chobani said it plans to invest about $1.2 billion over the next five years in the Pennsylvania facility.

Future Outlook: The transaction marks another shift in Keurig Dr Pepper’s portfolio as it focuses on its beverage and coffee businesses. The company recently maintained its annual forecasts after strong demand for its soda and energy-drink brands helped it beat second-quarter sales and profit expectations.

The U.S. Department of Justice has expanded its investigation into rising beef prices to include eight major retailers, including Walmart, Costco and Amazon. The antitrust division sent letters to the companies as beef prices remain near record highs, widening a probe that had initially focused on major meatpackers.

Beefed Up: The investigation also includes Kroger, Albertsons, Aldi, Publix and Ahold Delhaize USA. The DOJ is examining whether companies played a role in driving up beef prices, as the agency continues a criminal investigation into large meatpackers following accusations of manipulation and collusion.

Big Picture: The investigation comes as the U.S. beef industry remains highly concentrated: Tyson Foods, Cargill, JBS USA and National Beef Packing Company account for about 85% of slaughtered U.S. grain-fed cattle. Beef prices hit a record high in May, adding pressure on consumers already facing higher living costs.

Amazon Shipping will impose peak-season surcharges on packages beginning Oct. 25, adding up to 75 cents per package during the busiest stretch of the 2026 holiday season. The new fees will apply across three demand windows through Jan. 16, 2027, with additional increases for oversized, heavy, and special-handling packages.

Key Details: The standard per-package demand surcharge will be $0.50 from Oct. 25 to Nov. 21, rise to $0.75 from Nov. 22 to Dec. 26, and return to $0.50 through Jan. 16. Additional handling, large-package, and extra-heavy-package fees will also increase during peak, reaching $11.90, $117.50, and $590, respectively, during the busiest period.

Amazon Shipping said other elements of its service will remain unchanged, including no residential or weekend delivery surcharges, seven-day delivery where available, end-to-end tracking, and photo-on-delivery.

Fee Plan: Peak charges are added to contracted rates and apply automatically, so shippers using Amazon Shipping will need to account for the higher costs in their holiday-season planning.

Lululemon is cutting its outlook again, with the athleisure retailer facing slowing sales, weaker brand appeal, and growing pressure from rivals such as Alo Yoga and Vuori.

Big Weakness: The company now expects fiscal 2026 revenue to decline 5% to 7%, compared with its previous forecast of flat growth to a 1% decline. Shares fell about 18% in after-hours trading following the results.

The weakness is particularly pronounced in North America, where revenue fell 8%, while sales of leggings, a core category for Lululemon, dropped about 20%. China revenue also declined 2% in constant dollars, compared with 24% growth a year earlier.

What’s Next: The pressure now shifts to incoming CEO Heidi O’Neill, who takes over next week after Lululemon settled a proxy fight with founder Chip Wilson. O’Neill will be tasked with reviving product innovation and marketing, but analysts warn that a turnaround could take several years to show results.

The company’s share of the athleisure market fell to 43.9% in August from a year earlier, while Alo and Vuori gained share.