Walmart deserves credit for toilet-paper readiness 19 May 2020 Its biggest rival Amazon is still better at delivery services, which is key right now. But Walmart is ahead of the grocery game, and curb-side pickup will get a boost, too, even after lockdowns ease. And yet its stock is up half as much. Being in Jeff Bezos’ shadow has a price.
Delivery app dares Shanghai-to-New York IPO route 15 May 2020 Dada Nexus, backed by JD and Walmart, aims to raise $500 mln on the Nasdaq even as U.S. political backlash against Chinese companies intensifies. Luckin’s scandal raises fresh doubts, as do stock performances of recent debuts. And yet rival bourses are struggling to capitalise.
China’s JD flexes virus muscle memory 14 May 2020 Since forging its online business model during the 2003 SARS outbreak, the company has grown into a $70 bln force. With logistics providing a Covid-19 edge over Alibaba, JD’s quarterly sales are seen rising 13%. The momentum should help ease plans to raise $3 bln in Hong Kong.
Jeff Bezos puts shareholders in the corner 30 Apr 2020 Amazon’s revenue jumped 26% in the first quarter. Conditions are just right: more online shopping and a growing pool of jobless people from which to hire. But shareholders will have to join the queue, thanks to a giveaway of some $4 bln to customers and staff. It's classic Bezos.
Big Tech will emerge from virus too big to fail 28 Apr 2020 Amazon is an essential service keeping families supplied in a pandemic. The Apple-Google alliance on contact tracing will aid efforts to reopen economies. Facebook’s reach has disrupted virus disinformation. Their size is an asset in a crisis, making it harder to break them up.
Groceries are gluttony for India’s takeaway giants 28 Apr 2020 Couriers of prepared food are increasingly pushing into dried and fresh fare. It’s a bigger prize in a market dominated by home cooking. That could make SoftBank-backed Grofers, last valued at $650 mln, appealing to Zomato. Such meal combos are unlikely to deliver value, however.
Corona Capital: LVMH, L’Oréal, Pandemic bonds 16 Apr 2020 Concise views on the pandemic’s corporate and financial fallout. LVMH holds onto the luxury of cash, cutting its dividend; L’Oréal makes the best of lockdowns with more than 50% growth in e-commerce sales in the first quarter; and even Covid-19 fails to trigger pandemic bonds.
For staff, Jeff Bezos is more CEO than trailblazer 8 Apr 2020 The Amazon founder has transformed shopping. But the way the $950 bln firm treats its workers is not so futuristic. Like Walmart, it only recently provided protective gear to warehouse employees. That might fit with short-term profit, but not with long-term innovation.
Huawei’s home safety net looks less sturdy 1 Apr 2020 Earnings at the telecoms equipment giant hit $9 bln in 2019, although growth slowed as U.S. curbs whacked overseas handset sales. That has forced a refocus on China. Unfortunately local carriers are spending less than hoped on 5G, and smartphone rivals like Xiaomi look tough.
Meituan Dianping delivers extra side of ESG 31 Mar 2020 The $58 bln Chinese takeaways-to-taxis company expects a rough first quarter after Covid-19 closed eateries and curbed travel. With the outlook hazy, Meituan instead directed investors to the aid it’s providing customers. The initiatives may be useful in a fight against Alibaba.
JD certifies that old buyback habits die hard 18 Mar 2020 The Chinese e-commerce giant unveiled a $2 bln share repurchase plan amid a global crash. A possible second listing in Hong Kong may explain it, and JD is at least using cash on hand. Corporate obsession with such financial engineering probably will be pandemic-proof.
Pinduoduo feels Chinese small shopkeepers’ pain 12 Mar 2020 Petty online merchants hit by the coronavirus outbreak will weigh on the $41 bln e-commerce group’s earnings. Unlike rival Alibaba, Pinduoduo doesn’t host many big brands. The company may have to burn a lot of cash subsidising its stable of struggling mom-and-pop outfits.
DoorDash puts its valuation to the taste test 4 Mar 2020 The SoftBank-backed delivery service filed for an IPO as coronavirus puts extra strain on investors already wary of tech listings. Even on a good day, it may be worth about 40% less than its last $13 bln price tag. Owners are in for a reckoning whether they sell shares or not.
Virus may vindicate JD’s frail e-commerce strategy 2 Mar 2020 China’s $56 bln retailer expects first-quarter sales to rise at least 10%. As peers grapple with supply chain disruptions and labour shortages, JD’s less lucrative model of holding inventory and shipping goods looks more resilient. Pressure for rival Alibaba to follow will grow.
Jeff Bezos climate pledge has more flash than cash 18 Feb 2020 The Amazon boss can without a doubt help with the $10 billion global-warming fund he’s seeding. Microsoft founder Bill Gates could be a role model. But the scale of the climate crisis means even this amount of cash from the world’s richest person has whiffs of do-gooder-ism.
Walmart sales slip sets tone for wider worries 18 Feb 2020 The largest retailer in the United States posted slower-than-expected sales during the critical holiday season. It follows others like Target and Macy’s. Amazon is booming, but Walmart remains a better litmus test for the health of the American consumer.
Alibaba’s virus response is as much VC as ESG 13 Feb 2020 The Chinese e-commerce company is waiving merchant fees and slashing logistics costs. It’s just the sort of relief that local businesses need during a debilitating outbreak. And the startup-like use of cash-burning subsidies should help Alibaba keep customers and find new ones.
Shopify lives high life as e-tailing shovel seller 12 Feb 2020 The $65 bln Canadian software firm dominates a fast-growing niche building and servicing online shops, many of which marry cheap Asian goods with western marketing skills. It’s a combination that can run far. With the stock trading at 31 times estimated revenue, it’ll have to.
Tech deal review puts VCs in regulatory purgatory 11 Feb 2020 Alphabet, Amazon and Facebook are among firms that will be providing data on tiny acquisitions to the FTC under new orders. Transformative deals are also worrying, though the ad hoc scrutiny of tech seems biased. It is the next impediment to VCs exiting investments.
ICE-eBay deal would signal return of merger mania 4 Feb 2020 The $52 bln NYSE owner may want to buy the $30 bln online-commerce firm. There’s little benefit to the combo. But it is the kind of tie-up that frothy markets and a lack of savvy alternatives throw up. Investors’ withering reaction should warn ICE boss Jeffrey Sprecher off a bid.