Out Yahoo, Airbnb and Uber's Squid Pro Quo.
Last week, we had some of the best earnings from Uber, Airbnb and many more, but outstandingly, investors lost in the squid game coin.
Hey Hisa fan,
The weather in China is pretty hot, or so it seems. After ages and ages of shifting the earth's core with concrete, citizens have decided to stay out in the sun and China’s real estate sector is crumbling.
Chinese builders are facing an intensifying cash crunch following a government campaign to reduce leverage in the industry. That’s been made worse by a slump in home sales and prices as sentiment among homebuyers weakens.
Kaisa Holdings is the latest entrant into the real estate mess. The company is ranked 27th in terms of the market size in China and the third-largest dollar debt borrower among developers in China with more than $11 billion of bonds outstanding in the currency.
Kaisa became a focus of investor concern after it cancelled meetings with investors in October, triggering doubts about its liquidity and sending its dollar bonds lower.
Kaisa Holdings which is on the verge of missing payments of a guaranteed wealth management product may exacerbate the real estate sector’s crisis in China which is currently valued at slightly over $5 trillion; almost an equivalent of Japan’s entire gross domestic product (GDP).
Wait, Why’re we writing this?
First, it was China Evergrande Group, now Kaisa. Just how many Chinese companies out there are “insolvent” either in the long or short term? It is a growing concern to the entire global real estate sector?
Well, we may never know, we can’t read China from the outside, and the inside is closed as far off as the great wall of China can cover.
Yahoo, Bow out.
After LinkedIn, Yahoo has opted to move out of the Chinese market citing regulatory concerns in the world’s most populous nation. Yahoo users in Mainland China jumped from their favourite mailbox on Sunday to a message saying its sites are no longer accessible by Monday.
Chinese authorities maintain a firm grip on Internet censorship in the country and require companies operating in China to censor content and keywords deemed politically sensitive or inappropriate.
This, really?
Yes really! China is become a hard nut to crack for most tech companies and they have to fall into regulatory lines or back out. For instance, Google Search, Facebook and other social media giants have been for long partially blocked in China with most requests being pushed to the heavily monitored/censored Hong Kong servers.
How many tech companies will be crushed by China’s latest hit on tech? Anyway, let’s jump out of this censored state.
Earnings: Uber.
Last week Thursday was a good day for Uber Technologies Inc as the company reported its first profitable quarter on an adjusted basis since its launch over a decade ago. Here’s how the company performed.
Gross Bookings grew 57% year-over-year (“YoY”) to $23.1 billion, or 53% on a constant currency basis, with Mobility Gross Bookings of $9.9 billion (+67% YoY) and Delivery Gross Bookings of $12.8 billion (+50% YoY).
Trips during the quarter grew 39% YoY to 1.64 billion, or nearly 18 million trips per day on average.
Revenue grew 72% YoY to $4.8 billion, or 69% on a constant currency basis.
Delivery take rate expanded 220 bps QoQ and 410 bps YoY to 17.4%. Ongoing business model changes in certain Delivery markets benefited take rate by 400 bps in the quarter.
Net loss attributable to Uber Technologies, Inc. was $2.4 billion, which includes a $2.0 billion net headwind (pre-tax) from the revaluation of Uber’s equity investments.
Adjusted EBITDA of $8 million, up $517 million QoQ and $633 million YoY, to deliver Uber’s first Adjusted EBITDA profitable quarter as a public company.
Mobility Adjusted EBITDA margin as a percentage of Mobility Gross Bookings reached 5.5%, up from 2.1% in Q2 2021 and 4.1% in Q3 2020.
Delivery Adjusted EBITDA of $(12) million, improved by $149 million QoQ and by $171 million YoY.
Unrestricted cash and cash equivalents were $6.5 billion at the end of the third quarter.
Earnings: Airbnb
Looks like “hometels” are back, Airbnb came in with strong third-quarter profit growth and a beat on revenue estimates Thursday. Airbnb said recovery trends continue to vary regionally, and by vaccination rates and travel restrictions.
Revenue came in at $2.24 billion, up 67% compared to a similar period last year.
Net income surged 280% to $834 million on a year-over-year basis.
Gross booking value, which the company uses to track host earnings, service fees, cleaning fees and taxes were up 48% at $11.89 billion in the third quarter.
Average daily rates for the company dropped to $149 from roughly $161 in the last quarter.
Earnings per share stood at $1.22 per share.
The company reported 79.7 million nights and experiences booked in the third quarter.
Coffee Break…Squid Coin.
Quid pro quo seems to have happened in the squid coin. Quid pro quo implies a favour or advantage granted in return for something. Looks like Squid Game Coin investors got zero in return for their money.
After jumping more than 310,000% in value as of last Sunday night, Squid lost all its value after Twitter flagged the cryptocurrency’s account and temporarily restricted it due to “suspicious activity”.
The action by Twitter was also backed by a warning from CoinMarketCap, a cryptocurrency price-tracking website that had warned potential investors on the cryptocurrency’s possibly fraudulent nature.
According to data collected from various sources, creators of the cryptocurrency could have made away with as much as $2.1m after the token’s crash.
Good thing though, Crypto exchange Binance announced that it is investigating SQUID, and will turn over whatever information it uncovers to the appropriate law enforcement agency.
Markets.
Global equities kicked off November on a solid footing, with equity markets logging their best weekly return in more than four months. The week kicked off with the fed being more optimistic in the global economy, reducing tapering and more data showing that a COVID-19 pill that reduced hospitalizations and deaths in a clinical trial, there were plenty of reasons for the market to rally.
The quarterly earnings season wound down with ongoing strong results as profit margins held up well despite higher commodity prices and supply chain disruptions in various industries
For the week, the Dow Jones Industrial Average posted gains, with a 1.4% gain to 36,327.95, the S&P 500 was up as well for the week 2.0%, to 4,697.53 and the Nasdaq Composite gained 3.1% during the week to close at 15,971.59 basis points.
The local market was however painted red as major blue-chips posted declines backed by socio-economic factors within the region. The All-share index of the Nairobi Securities Exchange (NASI) decreased by 3.94% during the week to close the week at 170.94 points from last week’s figure of 177.96 points.
The NSE20 and the NSE20 share indices were similarly on the red, shedding 0.64% and 2.44% to close the week at 1,961.33 points and 3,757.80 points respectively.
What cowries are we collecting this week?
Paypal Holdings, Inc [NASDAQ: PYPL] - Global payment service provider Paypal is set to release earnings on Monday. Analysts are projecting an EPS of $1.07 and revenues of up to $6.23 billion. How will this be? We are watching.
AMC Entertainment Holdings, Inc. [NYSE: AMC] - AMC, one of the craze stocks during the wall street bets will be releasing their results on Monday. AMC’s Q3 projected EPS is at a loss of 53 cents with a Projected revenue: $708 million from analysts.
Kakuzi Plc [NSE: KUKZ] - On Friday, Kenya’s horticulture regulator banned exports of Kenya’s popular avocado varieties to curb immature harvesting of the crop effective 15 November 2021 to 15 January 2022. This is a short period but how will investors react to this, also considering the illiquidity of the stock.
How about you, what stocks are you watching for the week? Let us know on the Hisa App.
Disclaimer: This article does not constitute any investment recommendations. Investors and the general public are advised to do their own research before making any investment decision..