How many dogs want to eat the dog food? The Singaporean rideshare giant Grab is set to merge with the SPAC Altimeter Growth 1, according to a report from The Financial Times. They may never get back to the levels at which they traded before. GERSTNER: Scott, I love that you asked the question. And we are confident that your long-term investments in AI and the next generation of communications will continue to drive us all forward. If you have a two-to-three-year time horizon, there is no doubt there are a lot of stocks that are going to be up well over 100% off this bottom. As between each other Adhering Party and us, the amendments in the Appendices to the Protocol shall apply to each Protocol Covered Agreement to which we are a party in accordance with the terms of the Protocol and this Adherence Letter. Hedge Fund Manager. Instead, the company has announced investments of $1015B per year into a metaverse project that largely includes AR / VR / immersive 3D / Horizon World and that it may take 10 years to yield results. And, while that ultimately is an important long-term measure of success for all of Metas stakeholders, it would be imprudent to make short-term bad decisions just to improve the share price. It's interesting that now today you say we're in the neighborhood of a tradable bottom. Altimeter Capital. But I am confident these companies like Snowflake, like Uber, like Facebook are going to be worth more than they are today at significantly more if you look out two years. Meta said the cost of the Quest 2 will drop $70 to $429.99, while the price of the higher-end Quest Pro will be slashed to $999.99 from $1,499.99. We think both of those are solvable. Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology. It can do great this, the business can be incredible. If Meta was able to control those costs, he said, then it could double its free cash flow and improve its share price. If you click the "Accept" button, you consent to the use of cookies on our website. Altimeter is focused on technology investment, and has found multi-billion-dollar success. What's going to be the inflation print in April? Our best guess is that maintenance capex for Meta is less than $10B annually. ", Medium.com. The full text of the stockholder letter to the United Board follows: March 8, 2016. Reuters, the news and media division of Thomson Reuters, is the worlds largest multimedia news provider, reaching billions of people worldwide every day. Bruce Berkowitz's: Fairholme Capital Management. As such, we think Meta company should cap its metaverse investments to no more than $5B per year with more discrete targets and measures of success, as opposed to todays much more ambitious and open-ended strategy. It's a better version of Messenger. These include white papers, government data, original reporting, and interviews with industry experts. As you know we entered the year with a big bond short, we've now covered that bond short because we don't think that it's possible for the Fed to raise rates 7,10, 12 times as some people think this year. Perhaps it was the re-naming of the company to Meta that caused the world to conclude that you were spending 100% of your time on Reality Labs instead of AI or the core business. HONG KONG (AP) Southeast Asia's largest ride-hailing company, Grab Holdings, said Tuesday that it plans to merge with U.S.-based Altimeter Growth Capital in a deal that would value it at . Moreover, I am a strong supporter of founder-led companies especially when they have your successful track record of seeing the future. Altimeter Capital Chair and CEO Brad Gerstner said in an open letter to the company and CEO Mark Zuckerberg on Monday that Meta has too many employees and is moving too slowly to retain the confidence of investors. Perhaps it was the re-naming of the company to Meta that caused the world to conclude that you were spending 100% of your time on Reality Labs instead of AI or the core business. There isnt a day that goes by where I dont find myself using Metas products to communicate, to connect, and to entertain still amazed at the power of these services. $6.9 M. See here for a complete list of exchanges and delays. The Meta investor recommended a plan to get the company's "mojo back," including reducing headcount expenses by 20% and limiting the company's pricey investments in "metaverse" technology VR software and hardware to no more than $5 billion per year. Facebook parent Meta Platforms (META) announced that it would reduce selling prices for its Quest virtual reality (VR) headsets. Altimeter Capital owns a stake of about $320 million, according to the Wall Street Journal, but that only equates with a 0.1% share of the company, according to Meta's latest filings with the. That could in fact become a tailwind as we get to the back half of the year. I've got some people including a guy coming up in a little while Mike Wilson who suggested at this point bonds may be a better deal than stocks. [2] The firm focuses on technology investments in both public and private markets globally. Benchmark Reform and Transition from LIBOR InfoHub, Use of Chinese Government Bonds as Margin, Updated OTC Derivatives Compliance Calendar, ISDA-Clarus RFR Adoption Indicator: January 2023. 10. And, while most companies will struggle to monetize AI, we believe Meta is incredibly well positioned to leverage AI to make all of its existing products better.
Superficial change in panicked response to rigorous scrutiny is hardly noble or a basis for stockholders to have confidence in your judgment. Altimeter Capital Management is an investment firm that operates within the technology sector. That's why even the sell side consensus numbers have their growth rate accelerating, almost doubling between Q2 and Q4 of this year and we think it will accelerate even faster. United Continental Holdings, Inc.
But as you know, in the first three months of this year, all the high-quality stocks are being destroyed as well. Benzinga does not provide investment advice. . Protocol: In short, Meta needs to get fit and focused. We dont have any demands. [3] We agree to pay a one-time fee of $500 to ISDA at or before the submission of this Adherence Letter. And I appreciate you being with me on the very first "Overtime" show. A Division of NBCUniversal. How many increases? We have no more confidence that you will act responsibly in the future (even with yesterday's announcement) than we have evidence that you have done so in the past. 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In addition, people are confused by what the metaverse even means. So these are different order of magnitude bets. What is the metaverse and why are billions of dollars being spent on it? Market Research. Altimeter Capital Management partner Chris Conforti plans to leave the investment firm, according to people with knowledge of the matter. Menlo Park, CA 94025 (650) 549-9145 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies: . 9/29/2022 1:05 AM. Accept. Altimeter Capital Management LP now owns 2,850,000 shares of the Internet company based in Singapore's stock worth $131,784,000 after purchasing an additional 1,600,000 shares during the last quarter. Credit Derivatives Determinations Committees, how to enable The vast majority of the capex has been an essential and high-returning investment in data centers, Nvidia GPUs and other AI resources to solidify the companys position as one of worlds leaders in AI. Social networking is the use of internet-based social media platforms to make connections and share various media with friends, family, colleagues, or customers. So we believe not only you're going to get dramatically accelerated earnings, right, we think they're going to be a little bit more cautious about how they're spending those meta investment dollars, how they're spending dollars across the business. Congrats on the new show. So listen, I'm not happy about it. These are not numbers on a spreadsheet. But you also (sometimes) capitalize the first word of a quote. At $20-$25B of annual capex, Meta will still be investing market leading amounts to help invent the future of AI. Dont miss out on ET Prime stories! As you know, we have attempted to work collaboratively with the current Board to meaningfully improve governance, Board composition, and oversight. Access unmatched financial data, news and content in a highly-customised workflow experience on desktop, web and mobile. With all of this said, we truly believe that the company should be making some of these important investments. Limit investment in metaverse / Reality Labs to no more than $5B per year. Of course, a company that connects nearly three billion users on phone and text must be investing in the next generation of communication. effective risk management for all users of derivative products. Get your daily dose of business updates on WhatsApp. +Includes DocuBay and TimesPrime Membership. I imagine they're going to be super aggressive about how they're buying back shares. Link to 13F filings: SEC filings Dave Baszucki of Roblox describes the metaverse as the natural evolution of communication a multi-device world, including the phone, that is best thought of as a better version of text, video, and voice that will make us feel more connected. I don't think stocks today reflect a great price discovery about where these stocks are going to be in six months, let alone two years, but I'm also eyes wide open to the fact that we could go lower before we go higher. Nobody debates whether or not this company is going to be more valuable in the future. We also believe Metas investment in AI will lead to exciting and important new products that can be cross-sold to billions of customers. We dont have any demands. Altimeter Capital Chair and CEO Brad Gerstner, in an open letter to the company, said Meta has too many employees and is moving too slowly to retain the confidence of investors. Dave Baszucki of Roblox describes the metaverse as the natural evolution of communication a multi-device world, including the phone, that is best thought of as a better version of text, video, and voice that will make us feel more connected. Why 20%? Altimeter Capital is in talks with ride-hailing company Grab to bring the company public in a $40 billion deal, according to a report from The Wall Street Journal. UPDATE: Altimeter Capital, PAR Capital Issue Letter to United Continental Board - United Airlines Holdings (NASDAQ:UAL) - Benzinga SPY 397.68 0.74% QQQ 293.61 0.83% BTC/USD 22299.46 5.109%. And for us, we consolidate behind the things we have deep conviction in with confidence they're going to be worth more in the future. And Meta certainly has abundant financial resources to invest and / or return to shareholders. I have deep respect and admiration for founders that continue to grind, inspire, and invent long after the financial motivation is gone. Meta changed its company name from Facebook. It's 3 trillion, right? effective risk management for all users of derivative products. While the increased AI investment was clearly well timed, Metas investment in the metaverse, while smaller than the AI investment, has gotten the most attention and has led to much confusion. Barney Harford, former CEO of Orbitz Worldwide; former board member of Orbitz Worldwide and eLong;
This is a business it's trading at 12 times free cash flow, X the meta investment and 18 times including. If multiples expand then you have even more upside. When you were with me in December, you said that you had picked some more of that up along with Snowflake. I have spent over 20 years investing behind some of the worlds great founders who are helping to invent the technologies that move the world forward. The offers that appear in this table are from partnerships from which Investopedia receives compensation. I mean, we're talking about billions of dollars in revenue but you left that out. Frankly, if I was Sea Limited, if I was Uber, I might be looking at consolidating the business. Ranked #76 out of 483 Hedge Fund Managers. And so for us, it's about simplification, reduction of gross and making sure that you consolidate that what you own into your highest conviction ideas whether you're playing at home in your 401k or whether you're doing this professionally. We didn't think that was durable. Further strengthening our own conclusions, your seemingly desperate actions yesterday appear as a transparent and cynical attempt to maintain your official privileges and power, despite your long historical record of deficient oversight on behalf of stockholders. If you look at, if you look at, you know, what we expect to occur over the rest of the year, this stock will compound as it continues to beat earnings, as it continues to expand its use cases, even without multiples expanding, right, as investors begin to look at those higher numbers in '23 and '24. And frankly, they weren't a very good hedge because bonds haven't moved all that much but gross stocks are down 60, 70, as you mentioned, down over 80%. Right? So no, these issues are rea,l what's going on in Russia is real, what's going on in Europe is real. It added that VR is "a powerful social platform and creative technology, and the more people with access to it, the better. Paul A. Reeder
Despite public skepticism at times warranted we have been supporters of the companys strategy to continuously reinvest in a product-led future and its mission to make the world more open and connected. It's also a vote of less confidence about the company's ambitions in the world of virtual and augmented reality. Meta needs to re-build confidence with investors, employees and the tech community in order to attract, inspire, and retain the best people in the world. Whatever the reason, that is certainly the perception. At $20-$25B of annual capex, Meta will still be investing market leading amounts to help invent the future of AI. I think, or inflation, I think they're behind the curve on recession. The deal values the combined company at $35 billion and will. See the Top Performing Hedge-Funds > Brad Gerstner .
Over time, we intend to share with United's stockholders our detailed analysis, which has led us to conclude, among other things, that:
Altimeter Capital Management LP Info Size ($ in 1000's) At 12/31/2022: $3,652,571 At 09/30/2022: $4,676,285 Altimeter Capital Management LP holdings changes, total fund size, and other information presented on HoldingsChannel.com was derived from Altimeter Capital Management LP 13F filings. This lack of focus and fitness is obscured when growth is easy but deadly when growth slows and technology changes. We are confident that these employees will find replacement jobs and quickly be back to work on important inventions that will move us all forward. It's been a big drawdown this year. How big are the margins, ultimately Snowflake will be worth a lot more because there is almost endless demand for the product and this is a business that is highly profitable. This letter constitutes, as between each other Adhering Party and us, an Adherence Letter as referred to in the Protocol. Advertisement Gerstner, through Altimeter, manages over $15.0 billion worth of investments across private equity and venture capital. It's good to see you again. Altimeter's nominees are:
They're fearful about what's going to happen with rates. Open letter: Altimeter Capital founder and CEO Brad Gerstner encourages Meta to cut capex by $5B+, cut headcount by 20%+, and limit metaverse R&D to $5B/year As you know, we are long-term shareholders. They just announced that they're going to be profit, full company profitable by 2023. Stock Radar: 19% from Budget Day! Meta has also been feeling pressure to improve the finances of its Reality Labs, the company's metaverseunit, which includes the VR headsets. What Does Metaverse Mean and How Does This Virtual World Work? It said Grab is expected to raise between. Investors in the round: 776 Capital, Altimeter Capital, BoxGroup, Dragoneer Investment Group, FirstMark, General Catalyst, Radcliff Group, ShawSpring Partners, SignalFire, The Baupost Group, Torch Capital, TQ Ventures These times are what try people if you dig a hole and get into the hole here at the bottom after having lost, you know, my sense is you're locking in losses that you're going to come to regret. It is a poorly kept secret in Silicon Valley that companies ranging from Google to Meta to Twitter to Uber could achieve similar levels of revenue with far fewer people. Now that's what's going on in the business so all those people writing rest in peace epitaphs for Facebook are going to have to deal with that acceleration. If they just take the incremental cash they're going to generate this year and buy back shares that's 6% of the company Scott, let alone the 50 billion in cash they have sitting on the balance sheet. Includes DocuBay and TimesPrime Membership. Two years from now, people are going to be looking back and say, why the hell didn't you buy Snowflake at 160 bucks a share? That stuff was being advertised on Instagram. Brenda Yester Baty, Head of Strategic Initiatives at Lennar Corp.; former SVP Revenue Management at Carnival Cruise Lines. The firm's private equity arm makes all-stage venture capital investments, primarily in the technology sector. CAPEX Investing Aggressively and Responsibly in the Future of AI. We know they have high EBITDA margins on the rideshare business which is dominant across the region. With all of that said, we believe the company can responsibly and reasonably reign in capex while continuing to invest aggressively in AI and other critical areas. And now we've shot right through the five-year average. The metaverse is a shared virtual environment with aspects of online gaming, augmented reality, and more that people can access via the Internet. Altimeter Growth Corp. 2 raised $400 million in a January IPO. Industry Trends on 4000+ Stocks, Pro Investing by Aditya Birla Sun Life Mutual Fund, Canara Robeco Equity Hybrid Fund Direct-Growth, Cut workforce, spending on metaverse, key investor tells Mark Zuckerberg. A newly launched P2E adventure game, Chronos: Dawn of Tie, has introduced a series of brand-new PvP elimination tournaments.Last month, the whimsical battle game organized its beta stage featuring selected players. Why didn't you buy, you know, Uber at 28 bucks a share? In fact, our internet stock index is at a 10-year low and software is back nearly where we were in 2016 before the rerating of software occurred. We've destroyed over $15 trillion of stock market wealth. And so that will be rolled out in Q2 and Q3. After the pandemic, hospitals are now on a strong footing. I don't think the Fed is going to throw away two years' worth of work to try to avoid a recession in a election year and run us straight into the teeth of a recession while we're trying to fight a war in Europe. "Jitesh Ubrani: Tweet From March 3, 2023. Conclusion A Leaner, Faster, More Successful Meta. If the deal goes through, it. Is it all about rates at this point, especially when you're talking about the kinds of vulnerable stocks that we've really had front and center, those being tech? You can learn more about the standards we follow in producing accurate, unbiased content in our. Comprender el funcionamiento social, poltico, econmico, cultural y natural de la sociedad a fin de reflexionar, hacer propuestas y asumir compromiso en torno a las polticas de desarrollo nacional, local y regional en el mbito del respeto de los derechos humanos, la integracin econmica y la convivencia social, bajo una concepcin de desarrollo humano sostenible. The letter is the latest sign that Meta investors are starting to express reservations about the company's recent performance. They're building their own ad platform, right, that can deal with this. Today, the cost of capital has radically changed, and so has Metas growth rate. b***@altimeter.com. I think they have to take a look at their capital allocation plan. PLAN. On top of that we had supply chain challenges. Altimeter Growth Corp., the blank-check company merging with internet giant Grab Holdings Inc., is hovering just a few cents above its record low after cratering 28% since the deal was unveiled in . Why 20%? Meta shares moved 6% higher following the announcement. Mark Zuckerberg is a self-made billionaire and the CEO of Meta (formerly Facebook), which he co-founded in his dorm room in 2004. Ultimately, Gerstner said, Meta has too many people and is spending too much on capital expenditures. These are not numbers on a spreadsheet. However, there are few signs that VR or some of the company's metaverse apps, such as Horizon Worlds, are catching on with the public beyond early adopters. Getting Fit Headcount Reduction / Expense Control. You know how to time markets. In fact, we believe that augmented and artificial intelligence has the potential to drive more economic productivity than the internet itself. Musk Made a Mess at Twitter. The changes for the Quest 2 begin Sunday, March 5. Data is a real-time snapshot *Data is delayed at least 15 minutes. A letter addressed to Zuckerberg and the board of directors was published on Oct. 24. 2,06,700 crore) a year and capped annual investment in the metaverse to $5 billion (roughly Rs . I have deep respect and admiration for founders that continue to grind, inspire, and invent long after the financial motivation is gone. The silver lining is that unlike many companies, this popular narrative obscures the truth. At the start of COVID on March 26th when I felt about like I do today, growth stocks were under assault. 2023 Benzinga.com. Your P/E ratio has fallen from 23x to 12x and now trades at less than half the average P/E of your peers. Can it possibly be worth 100 billion? Enjoy a 7-Day Free Trial Thru Feb 17, 2023! It's our largest position we're not selling but we acknowledge that it's been rough for our investors, rough for us. Indias general insurers are looking to set up a larger marine insurance pool to cover the risks of transporting crude oil, edible oil, project machinery and fertiliser from the war-torn Russia-Ukraine region. Those three companies are all down that amount because it turns out that this year people got off their couch, they went out and they went to restaurants and they went in and did things instead of buy things. Brad Gerstner's Phone Number and Email Last Update. Bill McColl has 25+ years of experience as a senior producer and writer for TV, radio, and digital media leading teams of anchors, reporters, and editors in creating news broadcasts, covering some of the most notable news stories of the time. Reels, which is a massive product is going to increase its monetization between now and the end of the year. We simply wanted to further engage and continue sharing our thoughts as an interested shareholder. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers. Based on yesterday's announcement, it seems the Board now agrees that for many years it operated with a suboptimal composition.
We have little doubt investors and others would happily support scaling up these investments as the ROI becomes more tangible even if still long-term. Metas core business is one of the largest and most profitable in the world with over $45 B in operating profits last year alone. Following careful consideration, we have firmly concluded that meaningful change to United's existing Board of Directors is urgently required in order to reverse long-standing poor Board governance and the resulting many years of substantial and inexcusable Company underperformance relative to United's competitors. After all, why not hire more people and invest in more things when the cost of capital was near zero and growth seemed unlimited? The reductions for the Quest Pro start March 5 in the U.S. and Canada, and on March 15 in other countries where it is supported. Trading Book: Climate Risk Scenario Analysis Close Cart 0; Reveal page search bar; ISDA fosters safe and efficient derivatives markets to facilitate effective risk management for all users of derivative products. This compensation may impact how and where listings appear. It's going to do 20 billion in GMV. I think we spent about an hour together. But admittedly, you know, nights like tonight we'll we'll get we'll catch a little less sleep. For reprint rights: Continue reading with one of these options: Login to get access to some exclusive stories, Get access to exclusive stories, expert opinions &, Valid only with UPI, Credit & Debit Cards Autopay, Inciting hatred against a certain community, 15 We know Meta has more reach, more relevance, and more incredible opportunities for growth than almost any platform on the planet. So first, you need to understand why did we see a deceleration of revenue because that informs why we're going to see a reacceleration in the back half of this year. Our best guess is that maintenance capex for Meta is less than $10B annually. It was being purchased on the Shopify platform and people were using PayPal to check out. To put that in perspective, it merely takes the company back to mid-2021 levels of employee expense and I dont think anybody would argue that Meta wasnt sufficiently staffed in 2021 to tackle a business that looks similar to how it looks today.