Technology

Robinhood’s reversal, Russian oil cap

30 Jun 2022

The digital brokerage is worth less than a quarter of its $32 bln IPO value. In this Viewsroom podcast, Breakingviews columnists argue that its $7 bln cash pile and ample user base make it an attractive target. Also, Western leaders’ plan to restrict funds to Moscow may backfire.

Texas becomes Tesla’s new China

29 Jun 2022

The U.S. state has been good to the carmaker, offering tax breaks while the top prosecutor backed Elon Musk’s Twitter bot claims. That’s similar to how his relationship has worked with China. Musk returned favors to Beijing. Soon, he could become a dutiful friend of Texas, too.

Robinhood at $0 would start to look cheap

27 Jun 2022

At its recent stock price lows, Robinhood is a pile of cash with a digital brokerage thrown in virtually for free. Users might drift, and regulators may blunt Robinhood’s arrows, but assuming the most valuable customers stick around, it makes sense for acquirers to be circling.

Naspers “put” tackles one of its Tencent problems

27 Jun 2022

The South African firm and its Dutch offshoot will buy back stock by slowly trimming their $133 bln stake in the Chinese tech giant. Tax liabilities and clunky governance remain valuation drags. But investors can worry less about Naspers blowing its riches on other startups.

Zendesk’s sad exit shows tech bubble madness

24 Jun 2022

The customer service software firm agreed to a $10 bln offer – 40% lower than the one it nixed in February. Yet the private equity buyers aren’t getting an obvious bargain either, at over 50 times estimated EBITDA. Readjusting to reality can take a while.

Peter Thiel-tied fund fights China fire with fire

24 Jun 2022

A nonprofit fund backed by Silicon Valley bigwigs wants to invest in tech that serves national interests. It raises conflicts, security issues, and takes a page from Beijing's playbook. But given China’s market meddling, it’s not a horrible solution.

Too bad Netflix isn’t on the block

23 Jun 2022

Boss Ted Sarandos is exploring an advertising partnership to supplement the $80 bln firm’s subscription service. Yet media alliances – Netflix, Hulu, others – have turned ugly. Netflix’s valuation has fallen steeply, and it needs deep cash coffers. A better idea would be a sale.

Altria begins to look like tobacco’s bad bank

22 Jun 2022

The Marlboro-maker’s value fell by around $7 billion over a U.S. crackdown on nicotine and potential ban for e-cigarette partner Juul. Altria is starting to look like the riskiest parts of the tobacco industry, rolled up into a single bundle.

Capital Calls: Hydrogen IPO, Call centre M&A

20 Jun 2022

Concise views on global finance: Despite Thyssenkrupp postponing its clean energy listing, De Nora is still pressing on with its own one at a lower 3 bln euro valuation; customer-service group Sitel agrees to buy 2.6 bln euro rival Majorel in a cash-and-stock deal.

Baidu video sale hints at a China tech plot twist

16 Jun 2022

The search-engine operator may divest its Netflix-like streaming arm in a $7 bln deal. Ordinarily rivals like Tencent would welcome the opportunity, but the recent anti-trust crackdown will deter them. That clears the way for otherwise unlikely bidders, including state companies.

Samsung opens its wallet to a wary chip market

16 Jun 2022

Boss Jay Y. Lee's European trip has sparked hope that the South Korean conglomerate will finally use its $84 bln cash pile for M&A. Beat-up valuations at mooted targets like NXP make consolidation attractive. Appeasing concerned governments, though, will be a tough sell.

Tech plunge leaves $400 bln of low-hanging fruit

15 Jun 2022

Erstwhile tech darlings like Netflix, Alphabet and Meta have been clobbered by the equities selloff. Analysts reckon their earnings will continue to outpace the market. If that’s right – and it isn’t a stretch – these once-frothy stocks look pretty cheap.

Cricket rights will bowl India Inc a new line-up

10 Jun 2022

A third of teams in the sport’s premier league fit poorly with owners like Diageo. One, Reliance, wants the broadcast rights too. CVC’s entry into the club creates more uncanny parallels to a changing corporate India. The outcome of the $6 bln TV auction may spur a clean-up.

Apple pay-later foray blurs tech-finance boundary

9 Jun 2022

The $2.4 trln iPhone maker will use its balance sheet and data on user spending to offer short-term instalment loans. Fear of regulation and humdrum returns have largely kept big U.S. tech firms out of the lending business. Banks will be watching with interest – and trepidation.

Didi’s vertical integration strategy distracts

9 Jun 2022

The ride-hailing giant may buy a stake in Sinomach’s electric vehicle unit. Didi’s $5 bln cash pile, plus its data and technology, could revive the struggling state firm, which until recently focused on importing cars, not making them. It can’t help rebuild Didi’s core business.

Tech giants pick odd time for ad break

1 Jun 2022

Netflix, Sony and others are mulling commercials in shows and games. Given how ad spending gets hit in a downturn, the timing looks curious unless it offsets hard-up consumers cancelling subscriptions. The big winners are the ad-tech firms like Trade Desk making it happen.

Italian telecom network Plan B will be hurdle race

30 May 2022

Telecom Italia and a state-controlled rival want to merge their broadband networks. For KKR, which owns a stake in the $6 bln incumbent’s last-mile unit, it’s a consolation after a failed takeover. Yet any agreement will need to win over investors, bondholders, and regulators.

Capital Calls: Twitter snubs investors

27 May 2022

Concise views on global finance: The social media platform refused to accept the resignation of director Egon Durban, one more check for bad corporate governance. But it’s not like investors have held the company to a high standard.

Subdued Alibaba strikes fitting new tone

27 May 2022

New finance chief Toby Xu's focus on cost cuts and better-than-expected sales growth powered a 15% stock rally. The regulatory-thwacked e-commerce group is taking control where it can but exercising discipline on the bottom line in a slowing Chinese economy invites trouble too.

Review: War on digital payment fails to hit target

20 May 2022

Brett Scott’s “Cloudmoney” seeks to remind the world of the value of physical cash. It’s true that an overly automated system of money carries risks like the potential for surveillance. But the campaigner underestimates consumer demand for digital transactions.