Wednesday's Headlines: Roblox Stock Skyrockets
Here were the biggest movers in the MyWallSt shortlist yesterday:
Moving Up ⬆️
Farfetch (FTCH) +7.9%
Tesla, Inc. (TSLA) +7.4%
Cloudflare (NET) +5.5%
CrowdStrike (CRWD) +4.9%
Teladoc (TDOC) +4.8%
Moving Down ⬇️
Baozun (BZUN) -9.5%
Cognex (CGNX) -3.9%
Stitch Fix (SFIX) -3.7%
Trip.com Group (TCOM) -3.2%
Roblox Stock Skyrockets 🚀
Shares of video game developer Roblox shot up by over 11% yesterday following the publication of its December metrics report. Estimated revenue — which Roblox refers to as “bookings” in its report — was between $430 million and $439 million for December, marking a 17% - 20% year-over-year improvement.
Investors were naturally buoyed by these figures, but bookings weren’t the only reason for shareholders to celebrate. Daily active users came in at 61.5 million for the month — an 18% rise from the December prior.
The reaction to December’s report comes as a stark contrast to that of November’s, where a decline in bookings per daily active user — which remained flat for December — and a general slowdown in growth saw the company close down by over 15% the day the report was released.
Shares in Roblox fell by over 72% throughout 2022 as a harsh macroeconomic environment hammered tech and growth stocks. However, it’s currently up over 33% since the beginning of 2023 in a significant display of strength. The real question is whether or not it can maintain this form over a longer period of time.
Diageo Takes Control of Don Papa Rum 🍹
Multinational alcohol conglomerate Diageo announced it will acquire high-end Philippine rum brand Don Papa in a deal reportedly worth more than $430 million. The acquisition will add to Diageo’s collection of “super-premium” spirits that has seen growing success in the last few years. Don Papa will join the likes of George Clooney’s Casamigos tequila, bought in 2017 for $1bn, and Don Julio tequila acquired in 2014 via a brand swap.
Diageo isn’t alone, however, this trend can be seen across the industry with Brown-Forman picking up Venezuelan rum brand Diplomático in 2022.
Diageo will pay $280 million for Don Papa with an additional $190 million promised over the next five years based on performance. The deal will be funded entirely through cash and is expected to close in the beginning of this year.
Don Papa has become quite a hot commodity on the rum scene. Founded in 2012 by Stephen Carroll and Andrew John Garcia, the spirit was designed around the Philippines' extensive sugar and molasses industries. The drink is most popular in Europe, with France and Germany being its largest markets. It is rumored there was quite a bidding war for the budding brand.
Peloton Turns to Former Twitter Executive 🚲
Peloton has announced that Leslie Berland — former head of marketing for Twitter — will be its new chief marketing officer going forward. The hire, which comes into effect today, will see Berland take the reins following the exit of former CMO Dara Tresder in September, when she and a number of other executives left Peloton in quick succession.
Berland has described Peloton as being at a “unique moment in its transformation journey” and has expressed her enthusiasm to take on the challenge of restoring it to its former glory. She will report directly to CEO Barry McCarthy, the man responsible for Peloton’s dramatic overhaul since February.
McCarthy’s presence has seen Peloton move away from its traditional direct-to-consumer model, with its wares now available for purchase on Amazon following a successful deal between the two firms in August. With this new strategy in place, the success of the company will be massively tied to the work of the firm’s marketing team.
Peloton is currently down over 92% from highs seen in December 2020, as its significant pandemic-induced gains have been wiped out. However, it will take more than a new marketing hire to right the ship at Peloton. Investors shouldn’t expect a meteoric rise anytime soon.