Facebook’s future rests on Reels, not metaverse 9 Feb 2022 Mark Zuckerberg’s iffy bet on virtual reality cost Meta Platforms $10 bln last year. But the $600 bln social network has gotten higher returns for investors by improving on ideas that already exist. The best way to stop its decline is to copy its biggest competitor TikTok.
Spending bitcoin is harder than stealing it 9 Feb 2022 Cryptocurrency crime is soaring. But the seizure by U.S. authorities of bitcoin worth $3.6 bln, six years after the theft, shows it’s difficult to turn stolen tokens into cash. Anonymous transactions leave a clear trail. Even if the boom fades, the pursuit of thieves will go on.
Dutch $64 bln payments star is cure for tech gloom 9 Feb 2022 Adyen’s stock surged 10% after its results showed accelerating revenue. Following the rout in shares like PayPal and Netflix, it’s a reminder that piggybacking on the digital economy is a good bet. The catch for investors is that the best firms still trade at crazy valuations.
Arm IPO marks sober end to SoftBank chip party 8 Feb 2022 Under pressure from competition authorities, Nvidia dropped its deal to buy the UK chip designer from Masayoshi Son’s group. Arm’s sensitive position makes a listing the only realistic option. But Son will probably need to accept a valuation below the $32 bln he paid in 2016.
SoftBank Alibaba problem is worth more than an Arm 8 Feb 2022 Weak earnings from the Japanese conglomerate were eclipsed by its failed sale of the chip designer. Floating it instead could yet work well, but it won’t ease boss Masayoshi Son’s bigger issue: his stake in the Chinese e-commerce titan, which is worth as much as his entire firm.
The Exchange: Margrethe Vestager 8 Feb 2022 Europe’s antitrust tsar is responsible for keeping U.S. digital behemoths in check and making sure that the bloc doesn’t slip too far behind on technology. She joined Liam Proud to talk about a string of recent court losses and the future of competition policy.
Capital Calls: Continental, Harley-Davidson 8 Feb 2022 Concise views on global finance: German car-parts maker Continental may spin off its self-driving unit, while the iconic maker of motorbikes has turned supply shortages to its own advantage.
Failed deals illuminate red lines for chip buys 8 Feb 2022 The regulatory foiling of UK-based Arm and Germany's Siltronic, foreign takeovers worth $45 bln on announcement, says more about scarce tech than the prospects for industry consolidation. Humdrum mergers remain a useful way for companies to ride out the global chip crisis.
Amazon could get Peloton at garage-sale price 7 Feb 2022 The workout firm’s shares surged after suggestions the $1.6 trln e-commerce giant may buy it. Peloton isn’t an obvious fit, but the ability to sell subscriptions to even a sliver of Amazon’s user base is valuable. With the right regime, Peloton’s value could conceivably double.
Facebook $250 bln slump punctures antitrust case 7 Feb 2022 That’s how much Mark Zuckerberg’s firm Meta Platforms lost in value after growth stalled. Competition from TikTok specifically is getting tough, but U.S. antitrust regulators who are fighting Facebook have said the Chinese-owned app isn’t a rival. The market begs to differ.
Toshiba rejig goes long pragmatism, short vision 7 Feb 2022 The $18 bln Japanese titan now intends to split into two, not three. Ditching its earlier plan as too costly makes some sense, while buybacks and more asset sales may somewhat placate its most vocal critics. What’s lacking, though, is a longer-term strategy – and leadership.
Capital Calls: Wizz investor sides with workers 7 Feb 2022 Concise views on global finance: Denmark’s AkademikerPension picks an odd moment to offload its stake in the $6 bln budget airline over a lack of union representation among its staff.
Snap investors have too many stars in their eyes 4 Feb 2022 The messaging app’s shares soared 50% even though it warned ad privacy changes could hit revenue – something that clobbered Meta Platforms. They share risks, including an ascendant TikTok. Snap looks extra pricey given it lacks peers’ ability to hurl money at new problems.
Tech slump forces IPO hopefuls to consider Plan B 4 Feb 2022 Fintech Klarna, payroll provider Justworks and mobility upstart Lime are among those that were planning a listing in 2022. Yet tumbling valuations are prompting a rethink. Profitable companies can afford to wait. Others may have to find a buyer, or merge with a blank-cheque firm.
Capital Calls: U.S. jobs growth gives Fed cover 4 Feb 2022 Concise views on global finance: Employers added a solid 467,000 positions, reflecting economic resiliency despite a new wave of Covid-19 infections.
Amazon has a unique inflation problem 3 Feb 2022 Like peers, the $1.4 trillion giant dominates markets and has businesses that are growing rapidly. Yet Amazon has about 10 times as many workers, and a vast network of infrastructure vulnerable to rising prices. Yet it’s valued as if it does not.
Capital Calls: Playtech breakup 3 Feb 2022 Concise views on global finance: After investors rejected a 3.2 bln euro buyout offer from rival Aristocrat, a breakup of the gambling software maker looks the best way to maximise value.
Facebook’s grip on online ads may be slipping 2 Feb 2022 Parent Meta Platforms lost some $200 bln of market cap after an earnings report that suggested weaker-than-expected advertising growth to come. Headwinds ranging from Apple to TikTok are part of the problem; Mark Zuckerberg’s expensive pivot to the metaverse doesn’t help.
PayPal tries to suck more juice from fewer lemons 2 Feb 2022 The $160 bln payment firm has admitted that piling on 50 mln new customers a year isn’t the path to profit it previously thought. From now on it will seek to get more out of the customers it has. As other financial firms have a similar epiphany, a land grab may become a turf war.
Mark Zuckerberg’s startup project bets the company 2 Feb 2022 Meta Platforms has signaled a $10 bln hit to 2021 operating profit from investments in nascent virtual- and augmented-reality worlds. The founder has lots of advertising cash from his social networks to deploy. But reinventing an 18-year-old firm is a real-world uphill challenge.