After a new direct board connection is formed to a product market peer, a firm's gross margin increases by 0.8 p.p. Gross margin also rises by 0.4 p.p. after a new connection is formed to a peer indirectly through a third intermediate rm. Using barcode-level data, we further show that new board connections are related to higher prices of consumer goods and a greater tendency to dodge head-on competition. Board connections have positive profitability spillovers on the closest rivals, and the effects are stronger when the newly connected peers have more similar businesses or are located closer to each other.