Monday May.13, 2019

This Week: Uber, where to?

__"These Uber shares are all we have, Mr. Frodo"__
__"These Uber shares are all we have, Mr. Frodo"__

Mom always told us that life's about timing.

We hit the New York Stock Exchange floor for the Uber IPO (experience it @RobinhoodSnacks) — Just hours after fresh US tariffs hit China. Tough timing.

Stocks suffered their worst week of 2019 because the US-China trade deal didn't happen. But markets rebounded Friday on the latest 'constructive' talks (never say never).

Highs

Who's up...

Happy conference season... Google's Apple-ish I/O event (stands for "input/output") revealed a voice assistant to screen robo-calls, "Incognito" Google Maps, and (the main event) a $399 Pixel smartphone. Unlike Apple, Google doesn't need an extra-profitable $1,000 smartphone — Its focus is making money off hoards of data from your internet use.

Some hookups abroad... Match enjoyed a 14% revenue jump last quarter, courtesy of 23% user-growth internationally. Tinder is still its alpha app, totaling 4.7M active dating users. But shares jumped over 10% on one key stat: In places where Facebook's dating feature is already rolled out, Match hasn't seen any negative impact.

Cars want all the attention... GM's Cruise Automation (a self-driving car startup it bought in '16) raised $1.15B to push forward with robotaxis (planned for later this year). Then Tesla jumped into the car insurance biz, while Ferrari closed in on an all-time high stock price, powered by sales in China.

Lows

...And who's down

Angels out... Victoria's Secret won't broadcast its aggressively costumed annual fashion show on TV anymore — falling viewers and a realization that the whole thing was outdated led to the decision. But parent company L Brands dipped because the move highlights how out of touch the push-up brand became with our generation. Less catwalk, more bralette.

Expensive shave... Direct-to-consumer razor startup Harry's was acquired by the owner of Schick for a smooth $1.37B. But buyer Edgewell Personal Care fell 20% last week on word its own sales dropped 10% last quarter. Plus, the $2B cabinet-packing company (it also owns Playtex and Wet Ones) is barely worth more than the deal itself.

Break up... After two years of Facebook info scandals, we expected new tech regulation in the US. It hasn't come. But Zuck's co-founder Chris Hughes called out Facebook to be split into separate companies. Shares fell 2% last week as Hughes' words joined a Nobel Prizer (Joseph Stiglitz) and presidential candidate (Elizabeth Warren). Zuck's response: Breakup won't fix Facebook's problems.

Fresh

Uber's "tough timing" 8% drop on IPO day

Anti-surge-pricing... Uber stock fell 8% on Day #1 of trading. We were there for it, watching founder/ex-CEO Travis Kalanick roll up in an UberX. Uber Eats teammates handed out bagels/granola on the floor, while Employee #4 Austin Geidt rang the NYSE opening bell. Uber-style, the IPO already broke records:

  • $6 billion of Uber stock value was erased during the worst opening day loss of any US IPO.
  • It was the least profitable company ever to go public — Its loss the past 12 months was twice as big as the 2nd biggest IPO loser (ironically, that's Lyft).

"Bad IPO day" support groups... Wall Street needs one. Tech stocks tend to jump on IPO day — Over the last 24 years, they've popped 41% on average. But Uber's not the only exception:

  • Facebook: Spent its first 15 months below its IPO price. Now it's Earth's #4 most valuable company.
  • Snap and Lyft: Both lost a third of their stock value within a month.
  • Alibaba: Fell nearly 50% over its 1st year. Now it's nearly double its IPO price.
  • FYI, keep in mind: None of these past stock moves are signs of future ones — IPO stocks can be especially volatile. Always dive into a company's S-1 before jumping into its freshly-issued stock.

Venture capitalists were cool with Uber's losses... Maybe public investors aren't. Uber's epic '08 pitch deck convinced private investors to invest over $20B in Uber. After Friday's IPO, it's worth $76.5B — The same valuation as three years ago. New tariffs last week and a driver strike didn't help, but unprofitability is the fundamental worry for Uber (and Lyft). Robo-drivers could solve that (ETA is TBD). Will investors wait?

What else we’re Snackin’

  • Work: 8 keys to ace the dreaded "phone interview"
  • Life: 5 ways to get someone to do what you want
  • Money: Here's how startup stock options (like Uber's) actually work
  • Venture: "Blitzscaling responsibly" — The chapter directly from LinkedIn co-founder Reid Hoffman's book
  • Crypto: How the Winklevoss twins got into cryptocurrencies after the Facebook drama (video)
  • Defined: How an Exchange-Traded Fund (ETF) works — from your Snacks team

This Week

Get Your News

Subscribe and thrive

Snacks provides fresh takes on the financial news you need to start your day. Chartr provides data visualizations on business, entertainment, and society. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Latest Stories

2024-04-26-alphabet-sankey

Alphabet’s record Q1

Search and Cloud continue to deliver, as Alphabet announces its first-ever dividend

Stork delivery

America’s birth rate keeps dropping

Births in the US, like almost everywhere else, are on the decline

2024-04-26-nestle-new

Nestlé, the world’s largest food company, is struggling

Go Deeper with Market Depth

Nasdaq TotalView powers the need-to-know data serious investors rely on.

Scuba Diving in the Wild Blue Yonder in French Polynesia
World

Tangential remarks

Nicolai Tangen, the CEO who holds the purse strings of Norway’s $1.6 trillion sovereign wealth fund, thinks that his fellow Europeans don’t quite stack up to US employees when it comes to pure hustle, telling the Financial Times in a recent interview that there is a difference in “the general level of ambition” and thatthe Americans just work harder”. 

Tangen has clearly been putting his money — or more specifically Norway’s — where his mouth is: the sprawling Norwegian oil fund, now one of the largest investors on the planet, has been pumping more capital into its US holdings in the past decade, while decreasing its investment into European entities.

The troublesome news for our European readers? Tangen might be onto something. According to data from the OECD, American workers are putting in almost 60 hours a year more than the weighted average for OECD nations… a benchmark that workers from countries in the European Union are already ~180 hours shy of.

Hours worked

Tangen has clearly been putting his money — or more specifically Norway’s — where his mouth is: the sprawling Norwegian oil fund, now one of the largest investors on the planet, has been pumping more capital into its US holdings in the past decade, while decreasing its investment into European entities.

The troublesome news for our European readers? Tangen might be onto something. According to data from the OECD, American workers are putting in almost 60 hours a year more than the weighted average for OECD nations… a benchmark that workers from countries in the European Union are already ~180 hours shy of.

Hours worked
Power

$2T is the new $1T

Alphabet’s phenomenal earnings yesterday was enough to push the search giant’s market cap beyond $2 trillion, joining the likes of NVIDIA, Apple, and Microsoft.

Sunset Moonrise in New York City

Air taxi Blade is actually an organ transport business in disguise

How the helicopter fleet quietly became America's biggest airborne ambulance.

Your inbox is ready

Subscribe and thrive

Snacks provides fresh takes on the financial news you need to start your day. Chartr provides data visualizations on business, entertainment, and society. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

$70B

Alphabet shares are soaring in the after-market session, with a initial jump of more than 10% implying a gain of upwards of about $200B in market value when the stock opens tomorrow morning.

Google’s parent company crushed earnings expectations, initiated a cash dividend for the first time, and authorized a fresh $70B in share repurchases for good measure. The market likes it very much.

Business
Rani Molla
4/25/24

No, Apple hasn’t cut its Vision Pro production estimates in half

Quite a few news outlets are reporting that Apple thinks it’s only going to sell 400,000 to 450,000 Vision Pros in 2024, compared a “market consensus” of 700,000 to 800,000. They’re all citing a note from Apple analyst Ming-Chi Kuo.

Obviously there’s no question that Apple’s $3,500 face computer will have a limited audience and could be a huge flop, but this also doesn’t seem like accurate news.

The issue is that 1) this 400,000 number isn’t new. Back in July of 2023, the Financial Times reported that Apple planned to make fewer than 400,000 units in 2024, reducing its initial projections of 1M units, citing two people close to Apple and, the Chinese contract manufacturer assembling the device. 2) It's unclear who was estimating 700,000-800,000 Vision Pros in the first place, but it appears that it was Ming-Chi Kuo himself?

The issue is that 1) this 400,000 number isn’t new. Back in July of 2023, the Financial Times reported that Apple planned to make fewer than 400,000 units in 2024, reducing its initial projections of 1M units, citing two people close to Apple and, the Chinese contract manufacturer assembling the device. 2) It's unclear who was estimating 700,000-800,000 Vision Pros in the first place, but it appears that it was Ming-Chi Kuo himself?

 Max Holloway and Mark Zuckerberg

Meta exhaustingly tries to merge the metaverse and AI

Gonna have to rename the company... again

Rani Molla4/25/24