Wednesday Sep.04, 2019

Facebook tests the end of the like 👍

_Waking up in a like-free Instaworld_

Hey Snackers,

Prince Harry launched a travel startup.

Just as Brexit hit a fresh low and Argentina entered a currency crisis. Add to that the 1st decline in American manufacturing in 3 years and the Dow dipped over 1% Tuesday.

Testing

A side-hustler reveals Facebook's test to hide your "likes"

#AnxiouslyWaitingForLikes... Been there. You post a pic of you and that friend — or worse — a pic of just you. After 5 minutes you've got 2 likes. After 10, 6. After an hour, 14. DELETE POST. The like-struggle is real. Facebook is aware and just confirmed its test to remove the number of a post's social media affirmations from public view.

Side hustle... Jane Manchun Wong enjoys one as a "reverse engineer" — while you're reading Snacks, she's mining code, searching for deep-app irregularities. We'll let her describe what happened next in her own words:

"I observed that Facebook has recently begun prototyping this hidden like/reaction count feature in their Android app by reverse-engineering the app and playing with the code underneath."

Facebook confirmed it's testing a way to hide the likes from your followers/friends, but still showing you. Letting go 100% is hard.

This is a classic cost-benefit analysis... It's testing to see how users react first before it makes the thumbs-up invisible. The cons could hit Facebook's bottom line (less user engagement and potentially ad revenue), the pros are mostly for society (less anxiety). But Facebook could win valuable PR points if it makes the right decision — just as it separately faces political tech-lash over its privacy problems and anti-competitive size.

Recalibrate

Walmart's new arithmetic: add dentists/therapists, subtract guns/ammo

Toothpaste or teeth-whitening?... Both. Last week, Walmart sneakily updated its website to reveal it wants to be a doctor when it grows up: Starting September 13th, a Georgia location will add medical services. This week, Earth's biggest retailer is taking a fresh stand: guns. Big one. Here's what's in and what's out:

Out: Walmart will stop selling handgun ammunition nationwide or any handguns in Alaska (the last state where it still does that). And it's politely requesting shoppers not openly-carry guns in its 4,700 stores.
In: Walmart's still selling deer rifles and shotguns.

"The status quo is unacceptable..." — Walmart CEO Doug McMillon. Both he and Walmart's founder were avid hunters. Plus, the chain enjoys 20% of all US ammo sales. Now he's expecting these policies to drop that market share to 6%. Two recent shootings within Walmart stores pushed these moves — here's how they fit in:

1990s: Walmart stops selling handguns south of Alaska.
2015: Stops selling assault-style rifles.
2018: Raises minimum gun-buying age to 21.
Last month: Yanks violent video game displays.

Corporate policies > Government policies... (lately). Investors have been rewarding companies that jump into political issues where consumers crave government action, but aren't getting it. Picture Nike with social issues, Starbucks with employee pay, or private Patagonia on the environment. Walmart saw gun standards as its "responsibility" — now it's even sending letters to Congress to follow.

What else we’re Snackin’

Starring: Disney enjoyed 50% of all ticket sales this past summer — but the overall box office slipped 2%
Social: The NFL teams up with Chinese karaoke-ish app TikTok to try pandering to Gen-Z
UnGig: Uber and Lyft's stocks both hit all-time lows as investors lose confidence in ride-hailing since profitability ETA is so TBD
Hit: Hurricane Dorian arrives for the insurance industry next with $25B in expected losses
Holidays: Boeing falls another 3% on word its grounded 737 Max jets will remain that way through the end of the year

Wednesday

The first earnings report from Slack since its Direct Listing

20190904-943515-2843920

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Pop Quiz!

Sales of what are up 136% since 2019?

Don't be a sucka

$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.

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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?

Apple reportedly cuts Vision Pro production due to low demand

Seriously, relax

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Gonna have to rename the company... again

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Chipotle continues to go on a tear, hitting a sales record

Hey it might not be the kind of AI stock investors are all hot and bothered over, but don’t sleep on the burrito business.

Chipotle posted much better-than-expected results on Wednesday, with sales rising 14% to a record $2.70B in the first quarter, which is like a billion additions of guac.

Profits jumped 23% to $359M.

Chipotle has quietly cruised higher over the last year. It’s up 63%, compared to the 24.5% gain for the S&P 500 over the 12 months through Wednesday’s close. Not bad for a rice-and-beans based business model.

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Facebook had great earnings, the market hates it

Facebook reported impressive earnings. Record first-quarter revenue thanks to AI! Profit up 117% compared to a year earlier! But at the same time, its capital expenditures are going up and it’s expecting second quarter revenue potentially lower than analyst estimates. So in other words, the future doesn’t look as bright as the present.

All in all the stock is down more than 10%. (Basically the opposite of what happened with Tesla yesterday).

Net net

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Why Tesla investors are holding on to hope for a cheap car

Despite terrible earnings numbers last night — declining vehicle sales, disappointing revenue and profit, enormous spending — Tesla stock is up more than 10% as of midday. That’s a welcome move for the car company, that’s been among the worst performers this year in the S&P 500.

Why the about face?

While Reuters reported earlier this month that Tesla is no longer making its long-awaited $25,000 mass-market car — news sent the stock, already suffering from headwinds across the EV industry, down even further— Tesla reported during its earnings that it’s going to make cheaper cars than it currently has.

Before the second half of next year, Tesla said it will release “more affordable models” that “will utilize aspects of the next generation platform as well as aspects of our current platforms, and will be able to be produced on the same manufacturing lines as our current vehicle line-up.”

So rather than release the $25,000 Model 2, Tesla is incorporating some of that technology into its existing models. UBS called it the Franken-3Y2.