Alibaba polishes its crown and half-hidden jewels 20 Aug 2020 Quarterly sales at its shopping business rose 34%, in line with rival JD. But the cloud computing unit is growing nearly twice as fast and fintech affiliate Ant is on track for an epic IPO. The pair account for a fifth of Alibaba’s value. Boss Daniel Zhang has plenty to tout.
Corona Capital: Nvidia, Air conditioners 20 Aug 2020 Concise views on the pandemic’s corporate and financial fallout: Nvidia goes gangbusters, HVAC units have their moment in the sun.
Tencent’s D.C. lobbying is too little, too late 19 Aug 2020 WeChat's owner made its first hire to influence Washington amid a threat to ban the Chinese app. Huawei boosted government efforts after its finance chief was arrested. TikTok was less flat-footed but still tardy. Courting politicians works better before their help is needed.
Hong Kong speculators should read China Literature 19 Aug 2020 The fan-fiction startup leaped 86% on its first trading day in 2017, but is now underwater, alongside peers that enjoyed similarly oversubscribed floats. Low interest rates have the city’s retail investors back at playing IPOs, so another round of unsustainable pops is underway.
JD is having its self-sufficient star moment 17 Aug 2020 Adjusted earnings at the $97 bln e-commerce giant rose 66%. The mooted listings of its health and fintech units have helped shares rise 76% year-to-date, outpacing Alibaba. Boss Richard Liu’s costlier inventory-led model and domestic focus are finally starting to pay off.
TikTok sale is ultimate Silicon Valley hackathon 14 Aug 2020 The White House wants the U.S. app to make a clean break from China’s ByteDance. But it is messy. Tech footprints are hard to unwind. ByteDance’s investors – some American – aren’t pushovers. And politics are tricky, from weighing a cash Microsoft bid to a Twitter stock deal.
“Fortnite” battle is the new TV blackout 14 Aug 2020 Owner Epic is suing Apple and Alphabet after the tech firms kicked the popular game out of stores. Like U.S. cable and network fights, the problem is a lock on distribution. There, battles are often public but end with small wins for content. Epic could expect the same.
Ballad of China’s Robinhood has familiar refrain 14 Aug 2020 Like the hot U.S. e-brokerage startup, $4.2 bln Futu is capitalising on stock market frenzy. Quarterly net profit more than quadrupled thanks to a boom in offshore trading by mom-and-pop investors. A premium valuation over rivals, though, overlooks new competitive threats.
U.S.-China tech spat is less costly than tariffs 14 Aug 2020 The two nations will review their trade deal as the White House refocuses on a purge of Chinese apps. The economic damage is more limited than tariffs, which upended companies and hurt consumers on both sides. Containing the trade fight is more important than saving TikTok.
New York City real estate bites 13 Aug 2020 Sure, Facebook just signed a lease in Manhattan but other businesses are scrambling to renegotiate contracts and residential vacancies have hit records. The Big Apple has proved incredibly resilient. But investors think New York is in for it. This time they could be right.
Ant’s dual listing could double cross Wall St 13 Aug 2020 A chunk of the $150 bln fintech giant will be sold on Shanghai’s new tech board, where IPO fees are as generous as in New York. Foreign banks in Hong Kong could be left with a smaller share of the pie. If more issuers follow Ant’s march, Wall Street’s dues are in for a reckoning.
Realtor IPO overcharges for Chinese housing 13 Aug 2020 Tencent-backed KE’s U.S. debut could value it at $23 bln. Home sales in China are recovering on easier credit, and the company is growing fast. It’s an online play on a sector that has consistently proven sceptics wrong. The price, however, may cause buyers’ remorse.
Tech’s market supremacy is warning sign 12 Aug 2020 Companies in the sector make up 31% of total U.S. equity market value, a share not seen since the dot-com bubble. Today's tech titans make hefty amounts of profit, so it’s not pure speculation. It's more a complacent bet that their dominance won't be challenged.
Tencent encapsulates new challenge for China tech 12 Aug 2020 The $635 bln giant derives most of its value from video games, ads and payments units that don’t rely much on foreign partners. But any restrictions on working with U.S. firms might have an outsize effect on its growth. Boss Pony Ma will have to sweat his company harder.
Cable Cowboy makes pricey Swiss return call 12 Aug 2020 The Alpine arm of Liberty Global, founded by billionaire John Malone, is paying $7.4 bln for telco Sunrise a year after a deal to sell to it fell apart. This trade is riskier, and more expensive. But the logic of creating a rival to state-backed Swisscom justifies the reversal.
Corona Capital: “Halo”, Salesforce, Brooks Bros 12 Aug 2020 Concise views on the pandemic’s corporate and financial fallout: Microsoft delays the next chapter of the “Halo” game franchise; Salesforce gets a lockdown bonus with sale of Zoom shares; and Simon Property suits up with a purchase of Brooks Brothers out of bankruptcy.
SoftBank lives the high life on yard sales 11 Aug 2020 The $129 bln group returned to profit last quarter, buoyed by a T-Mobile stock sale and other investment gains. Asset sales fuelled share buybacks that narrowed a wide group discount, and there are large Vision Fund exits to come. Boss Masayoshi Son can keep coasting for now.
India is the neglected elephant in TikTok’s room 10 Aug 2020 Microsoft and Twitter want pieces of the Chinese video app, but seem uninterested in its largest market by users. There may be practical reasons, given Western tech giants remain welcome in India. But they might also fear New Delhi will give local copycats a helping hand.
Trump’s swipe at Tencent hits China’s softest spot 7 Aug 2020 The White House will block “transactions” with the $687 bln tech giant. That could cripple its WeChat app outside China and put a vast portfolio of investments at risk, including "Fortnite" creator Epic Games. The ban could sting China harder than the campaign against Huawei.
Uber’s post-Covid prognosis is far from all clear 6 Aug 2020 The $60 bln ride-hailing app's second-quarter revenue fell 29%. That may mark the bottom. But despite CEO Dara Khosrowshahi's efforts Uber is still Exhibit A for the lack of benefits extended to gig workers. Washington is unlikely to rubber-stamp its deal for Postmates, either.