Could Airbnb’s IPO Be In Jeopardy?

Could Airbnb’s IPO Be In Jeopardy?

#AirbnbIPO

Having previously outlined plans to go public in 2020, Airbnb’s backers will be disappointed with the company’s latest financial results. 

What does this mean for its IPO plans? 

Going public certainly may have gotten a whole lot more complicated for Airbnb with concerns emerging following the latest financial reports. From January through September in 2019 Airbnb notched a $322 million net loss compared with a $200 million profit in the same 2018 period, as the business invested heavily in addressing widespread safety and security issues on the platform. Given the fallout from 2019’s list of disastrous unicorns — including WeWork and Uber — investors are more skeptical of companies that don’t post profits. Of course, Airbnb has shown in the past that it can make a profit and its losses still pale in comparison to the $8.5 billion Uber blew through in 2019, but the company may need to consider the ongoing problems in the market, such as the coronavirus, which could have a massive impact on the global economy. These are certainly factors to ponder, but we will have to wait and see what Airbnb intends to do, as for now, they are remaining silent on the matter. 

Bet you didn’t know

In order to pay rent, founder Brian Chesky rented out an air mattress on the living room floor, unknowingly creating the business model for the company he would later establish. The use of “air” in the name is a tribute to the company’s roots.

 

#TechProblems

A fresh FTC investigation was thrown at Big Tech this week, with Apple becoming the main target due to its long acquisition history.

What did Big Tech do this time? 

In what is becoming the norm as of late, the Federal Trade Commission announced on Tuesday that it will examine prior acquisitions by Alphabet, Amazon, Apple, Facebook, and Microsoft in order to determine if they breached anti-competition regulations. The FTC will require the companies to provide information on acquisitions not previously reported to the antitrust agencies between January 1, 2010, and December 31, 2019. The primary target, however, appears to be Apple, whom the FTC will be examining in relation to a litany of discreet deals it has made. CEO Tim Cook has previously stated that Apple acquires a company every two to three weeks on average, but it doesn’t announce the deals because the company is “primarily looking for talent and intellectual property.” Well Tim, the chickens have come home to roost, and it’s time to cough up the details on these secretive deals. 

Bet you didn’t know

Apple’s $3 billion acquisition of Beats in 2014 was its largest purchase in history and set the platform for Apple Music’s rise. 

 

#NetflixOscarWoes

“And the Oscar for Best Picture goes to — anyone but Netflix!”

A very disappointing year…

Having received more nominations than any other studio, Netflix will be as surprised as anyone to come away from the 92nd Academy Awards with just two little gold men. Laura Dern’s Best Supporting Actress victory for ‘Marriage Story’ and ‘American Factory’s’ Best Documentary Feature were the only shining lights for Netflix, which will be bitterly disappointed that its critically-acclaimed Scorcese flick ‘The Irishman’ won nothing (despite costing the studio close to $160 million). The narrative of Hollywood for quite some time has focused on just how disruptive streaming services could be to the status quo. Could Netflix, Amazon, Disney, and their ilk give life to indie movies or produce crowd-pleasing hits? Could they win prestigious awards? So far, the answer to all of those has been “yes” but the industry’s most coveted award will continue to elude Netflix for yet another year. It would be kind of funny if Disney won Best Picture next year… 

Bet you didn’t know…

… that the Oscars were even on last Sunday. I know I certainly didn’t. The only reason I found out was that I was researching Netflix. Oops. 

 

#MoreEarnings

Earnings season continues here at MyWallSt, with some more big names from our showroom reporting, including Shopify and Under Armour. 

How did they get on

Chegg

Education technology leader Chegg topped Q4 estimates as services grew 31% to $107.3 million and raised its full-year guidance as high as $527 million. The company is benefiting from its move to subscription-based software and away from textbook rental. 

Hasbro

Toy-maker Hasbro experienced strong holiday sales bringing net income to $267.3 million, thanks largely to its lucrative deal with Disney, as its range of ‘Star Wars’ and ‘Frozen 2’ toys were a big hit. 

MercadoLibre

Argentina-based MercadoLibre beat on revenue of $674.3 million, while EPS disappointed at a loss of $1.11 per share. It remains the largest provider of e-commerce services in Latin America, operating in 18 countries.

Roku

Brand-agnostic streaming service Roku reported better-than-expected net losses of $15.7 million, and boasted nearly 37 million active users, up 4.6 million from last quarter. Roku’s aggressive promotional strategy in 2019 appears to have paid off coming into 2020.

Shopify

Shopify reported better-than-expected earnings on Wednesday of  $505.2 million, up 47%, while also taking in $2.9 billion between Black Friday and Cyber Monday. The e-commerce company continues to be a thorn in the side of larger rivals Amazon and eBay.

Under Armour

Things are looking dire for Under Armour after shares fell 19% on Tuesday, with the company reporting disappointing revenue of $1.4 billion and weak guidance due to coronavirus fears. The company has been in decline for 2 years as it lags behind rivals Nike and Lululemon.

Bet you didn’t know

Despite the rise of competitors such as MercadoLibre and Shopify, Amazon is still the online-shopping king with roughly 50% market share in U.S. e-commerce. 

 

#AndFinally

Sometimes it’s hard to be an investor, and sometimes you must cling to the smallest victories to keep going. Well, Slack investors are apparently so desperate for any good news about the unprofitable company that they pushed the stock sharply higher on a report that turned out to be old news. Shares in the work-collaboration software maker soared more than 15% Monday after Business Insider said that IBM had would open Slack accounts for all of its 350,000 global employees, making ‘Big Blue’ Slack's biggest customer. There’s just one problem though: IBM has been Slack’s biggest customer for years. The company revealed this — apparently little-known — fact in an SEC filing after market close that same day. In other ‘news’, Apple has just announced it will start selling smartphones. 

How is Slack doing?

Not too good, unfortunately. The company is expected to post a quarterly loss of $31 million, or $0.05 per share during its next earnings call — which it still hasn’t announced. 

Bet you didn’t know

In the past 30 days, MyWallSt employees have sent roughly 20,000 messages on Slack, which is an average of 1,000 messages per work-day. It is estimated that 95% of these messages were in meme or GIF form. 
 

JamieJamie

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