Original link: https://www.latepost.com/news/dj_detail?id=1152
Zhihu’s losses nearly doubled, and the market places more emphasis on earning power
This afternoon, Zhihu released its first-quarter earnings report before the US stock market opened, and its stock price soared more than 8% before the market. But that’s not because of how pretty Zhihu’s financial data is.
In the first quarter of this year, Zhihu displayed advertisements in various ways and sold members with various stories, increasing its revenue by 55% to 740 million yuan, and its adjusted loss by nearly 90% to 370 million yuan. Not as fast as losses. However, Zhihu announced in its earnings report that it was “confident in the company’s continued growth in the future” and would spend up to $100 million to repurchase shares in the next 12 months. ——After the repurchase, the number of shares on the market decreases, the value of the company remains unchanged, and the stock price generally rises accordingly.
A loss-making company spends the equivalent of its first-quarter revenue to buy back stock, which is a big deal. Even so, after a stimulus of $100 million, Zhihu’s market value at the opening of the market on May 25 was only $853 million, which was lower than the cash on the account ($1.1 billion).
Zhihu CEO Zhou Yuan said that the company will control costs and improve operational efficiency. Yesterday, the news of Zhihu layoffs of 20% to 30% in the market may be one of the actions. Zhihu responded that it is a “normal business and organizational optimization adjustment”. Layoffs are another short-term bullish sign for capital markets.
Compared with the end of June last year, Zhihu’s market value has dropped by nearly 90%. For various reasons, China Concept Stocks have not been good this year, but the degree is very different.
During the same time period, Tencent’s market capitalization decreased by 43% and Alibaba’s by 63%. Now, Huya and Momo (Zhiwen Group), which are similar in size to Zhihu, have different market value evaporation rates. The obvious correlation is earning power.
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For a long time, losses were not a problem for Chinese Internet companies, and the capital market paid more attention to its future imagination. Whoever catches young people and who “ends the game” is bigger.
The market is willing to give a higher market value for the future. Chinese tech companies, big and small, that can go public in the U.S. are seen as the best safe havens by investors in 2020.
Until the end of June 2021. The market environment has changed, and the valuation logic of Chinese Internet companies in the overseas capital market has been adjusted accordingly: the story is far less important than the sustainable earning ability.
When the market environment has completely changed and financing is no longer endless, the story is not so important, and profitability is the key.
Although the market value of large companies that can make money has shrunk significantly due to market environmental factors, they have sufficiently stable profits and strong cash flow, and their situation is much better than that of second-tier companies that do not make money. Just like Beijing and Shanghai, housing prices are more resilient than second- and third-tier cities.
Stocks are the capital market’s expectations for the future. The current market value of Chinese concept stocks with huge losses is often lower than the amount of cash in their hands – indicating that the market generally believes that their future value is not even as good as today.
The Internet has changed from an emerging industry to a new generation of infrastructure, and the market is pricing them closer to ordinary companies. (He Qianming)
Luxury blends games and Web3 to meet the shrinking middle class
Once, luxury brands like to pay for artists to maintain their high-end image; now luxury goods are sponsoring e-sports players, targeting another market.
Gucci this week announced the establishment of the “Gucci Gaming Academy” to support potential esports rookies around the world. The first four sponsored players are from Eastern Europe. Gucci says it will customize esports training programs, build personal brands, provide gaming gear, and even arrange mental health coaching in partnership with WHO.
In addition to Hermes and Chanel, luxury brands are generally trendy, and the virtual world is also part of their transformation.
- Last year, Gucci opened a garden in the game Roblox, where players can transform into an image designed by Gucci to visit and buy Gucci NFTs inside.
- Balenciaga has launched joint skins, props and opened a virtual store in the Fortnite game. At the same time, it also sells joint models offline.
- Burberry sells its own NFT game props and characters in the blockchain game Blankos Block Party. The cheapest price is $25 and the most expensive is $300.
- In China, “Honor of Kings” and Burberry launched a joint hero skin (later the cooperation was stopped), and players of “Peace Elite” also opened a virtual Lamborghini at the beginning of this year – the market price is more than 600 yuan.
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Luxury conglomerates thrive on the middle class. Although most of them can be traced back to aristocratic items, such as LV suitcases that need to be carried by servants, they rose in the 20th century because they made bags and clothes for the growing middle class that could be used for work.
But class differentiation is a global issue, and the middle class has shrunk globally for several years. Especially the epidemic, the World Bank data estimates that the epidemic caused 150 million people in the world to fall out of the middle class in the first year.
Luxury groups choose to focus on the unaffected wealthy groups, such as LV, which has raised prices five times in a year. Although fewer and fewer people can afford Classic Flaps or Capucines, the profits of first-tier brands are increasing by dozens of percent every year.
This is similar to the luxury brand in the tech world, Apple. In 2017, Apple raised the price of its main mobile phone by 40%, maintaining profit growth when sales were no longer growing.
But luxury giants won’t stop just because of more profits. They have already changed from a family brand to a listed company, and the most important value must be continuous growth to create more returns for shareholders. Just like Apple did not stop after the price increase, but launched new digital services, from selling fitness courses to relaunching advertising platforms, looking for growth beyond selling hardware. (Refer to the previous report of “Waidian Finance” that “Apple restructures its service business, streaming media and advertising are new growth priorities” )
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When the middle class looks promising, luxury brands are more likely to open secondary lines and sell small items. Chanel, which started from haute couture, and Hermès, which started from leather goods, have the same destination, and now there are many overlapping categories; jewelry company Cartier has made watches, pens and leather goods; Armani has made perfume, glasses, skin care products, watches, leather products, flowers, chocolates ,Restaurant.
Rich people can afford the core product line of the brand, and the brand also relies on this to maintain its “luxury”. But even young people who are not yet middle-class can spend a few hundred yuan to buy big-name lipsticks, perfumes, and sunglasses, and own a luxury item.
But as people stop believing that they are getting richer, they are often more willing to buy some cheap happiness in the virtual world. And more than 100 yuan of digital goods will not let the brand drop in price – you can’t buy 100 yuan of physical goods at Burberry.
Luxury brands have their sights set on virtual worlds, including gaming and Web3. This may represent their judgment on the future: the huge group of young people who are difficult to complete the class leap, spend more and more time in the virtual world, and cherish the satisfaction in the virtual world more. Now, the world’s netizens spend an average of 6 hours a day on the Internet, and there are 2.9 billion gamers in the world, which is enough for mainstream brands to develop.
Compared with the size of the game, making sunglasses and perfume is not attractive enough. According to research institutes, in 2021, the world will buy $21.17 billion worth of sunglasses and spray $30.6 billion in perfume, but spend more than $200 billion on video games. What’s more, the growth rate of the first two is below 5%, and the game is growing rapidly through Web3. (Wang Yuqing)
ByteDance brings the experience of managing people to Feishu
- Feishu held a press conference today and announced the new function “Feishu People”, a personnel management product that integrates personnel, recruitment, performance and OKR. Feishu CEO Xie Xin said that this feature can help companies solve the problem of talent management.
- Like other functions on Feishu, the People function also comes from within ByteDance. People is the name of ByteDance’s human resources system. Through this system, ByteDance’s management can know an employee’s past resume, work status, bi-monthly assessment performance, OKR, etc., and more effectively manage and schedule more than 100,000 employees.
- From the first collaborative office system (Feishu Office) to goal management (Feishu OKR) to the current human management (Feishu People), Feishu has gradually integrated the efficient office experience accumulated by ByteDance. How to combine Byte’s experience with more enterprises will be the focus and difficulty of Feishu’s functional iteration.
- Lin Chan, Feishu’s chief commercial officer, said that Feishu will continue to increase its support for small and medium-sized enterprises. On the basis of Feishu Office Standard Edition, Feishu People Standard Edition, a personnel product, is provided free of charge to small and medium-sized enterprises. At the same time, 10,000 free official exclusive service places will be opened to small and medium-sized enterprises. (He Qianming)
Individuals buy new energy vehicles in Beijing, and they have to wait 22 years for the license plate
- This morning, the review results of this year’s new energy passenger car index application were announced. If the current policy remains unchanged, individuals will have to wait 22 years and 5 months to apply for a new energy license plate, nearly 4 years more than last year. And queuing according to the family unit, only need to wait less than 5 years.
- The change is because the Beijing new energy license plate index is gradually tilting towards household applications. In 2021, Beijing announced that 60% of the new energy passenger car quota will be prioritized for “car-free families” (not necessarily married, individuals can also count as families with their children and parents), and gradually increase to 70% and 80% in 2022 and 2023. Leave the rest to the individual.
- Before the implementation of the policy, there were 54,000 new energy license plate indicators for individuals, which will be reduced to 21,000 in 2021 and less than 20,000 this year. Fewer are expected next year. Individual applicants are only increasing. This year, more than 428,000 individuals applied for license plates, nearly 25,000 more than last year.
- Beijing also has requirements for the total number of passenger cars. According to Beijing’s “14th Five-Year Plan”, by 2025, the number of passenger cars will be controlled within 5.8 million, and by the end of 2020, it will be 5.273 million. In other words, there are only 527,000 indicators in these five years.
- Beijing license plate indicators are tilting towards new energy vehicles. There are a total of 100,000 license plate indicators this year, and new energy accounts for 70%, compared with 60% three years ago. (Dou Yajuan)
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Second-tier social media companies cut expectations, US Internet stocks crash
- When the picture and video social media Snap went public, it called itself a “camera company”. The feature is that many functions will not exist permanently on the Internet and will disappear in a certain period of time. As of the first quarter of this year, Snap had 330 million daily active users, less than 1/6 of Meta (Facebook) and far lower than TikTok. Snap’s revenue is only a tenth of Meta’s.
- But on Tuesday, when Snap lowered its revenue and profit forecasts and announced a slowdown in hiring, not only did its own share price fall nearly 30%, it also sent technology stocks lower. Meta once fell by more than 9%, Google also fell by 4%, and the market value of several American Internet giants has evaporated by more than 200 billion US dollars.
- The reasons for Snap’s slump are obvious. A month ago, it also optimistically predicted that the revenue in the second quarter would increase by 20%-25% year-on-year, which gave the market too good expectations. The reversal in such a fast time shows how fast the economic environment is changing. Snap is mostly small advertisers, and it is even less risk-resistant – the capital market believes that this is a precursor to “rapid macroeconomic deterioration.”
- The New York venture capitalist asked last year “how will this (capital) boom end?” He didn’t say when, but predicted that “at some point, the economy will recover, central banks will tighten money supply, interest rates will rise; maybe there will be Consumer goods and labor prices rise. When the economy recovers and interest rates rise, the asset bubbles that have formed will disappear.” It appears that the bubbles in the capital markets are bursting, not just in the stock market, and not just in the US. (Lin Guangying)
Tesla is opening a restaurant in Hollywood where you can watch movies while eating and charging
- Last week, Tesla submitted documents to the city of Los Angeles to open a 24-hour Tesla restaurant on Hollywood Street, covering an area of about 860 square meters and two floors, including 28 superchargers and more than 200 restaurants. seating, and a drive-in movie theater.
- The idea is said to date back as far as 2017, when a Tesla executive mentioned that Tesla charging stations might offer catering. You can grab a meal while you’re waiting to recharge — Tesla’s supercharged, 200-mile charge takes as little as 15 minutes, and it’s not as fast as refueling.
- Opening a restaurant at a charging station does not necessarily make money. The charging stations are generally distributed, but the single point is not large, and the operating cost of the restaurant is higher, which requires sufficient passenger flow support. Conversely, it is more common to set up charging piles in existing restaurants. For example, Volvo plans to install fast charging in Starbucks stores on the side of the highway.
- Tesla has clearly thought about this, and the restaurant’s location in Hollywood comes at a time when travel is recovering in much of the world, and it doesn’t have to worry about traffic. The restaurant is said to be futuristic in style with Tesla, and at the same time reflect American nostalgic culture, including drive-thru restaurants and theaters.
- In 1900, the Michelin brothers started writing the Michelin Guide, hoping to encourage people to go out and explore the gastronomy – people buy more cars, they can sell more tires, one review wrote. In contrast, Tesla restaurants are less revolutionary, but should also attract new EV users. (Lin Guangying)
Caption: Tesla’s restaurant design.
The new Omicron variant has become mainstream in the United States, and it has a stronger spread than the popular BA.2 in Shanghai.
- According to the US Centers for Disease Control and Prevention (CDC) data, last week, the new Omicron variant BA.2.12.1 surpassed BA.2 to become the leading strain of the new crown epidemic in the United States, accounting for 57.9% of the total number of cases.
- BA.2.12.1 is a variant of BA.2, which is 23% to 27% more contagious than BA.2, according to estimates by the New York Department of Health. At present, most domestic cases are infected with BA.2.
- The first detection of BA.2.12.1 in the United States was in the first week of March. Because the time is too short, there are no studies on the severity and mortality of the same conditions. Some preliminary observations show that there is no significant difference from BA.2. On the other hand, as Americans are mostly vaccinated or acquire antibodies as a result of natural infection, the rate of severe illness will naturally decrease.
- Medical experts remind that although many patients who have been infected with Omicron will still be re-infected with BA.2.12.1, vaccination can effectively reduce the severe rate. (Lin Guangying)
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OTHER NEWS
Pony.ai’s autonomous driving test license in the United States has been revoked.
Technology media TechCrunch reported that when the California Department of Motor Vehicles (DMV) reviewed Pony.ai’s application for updating its autonomous driving license, it found multiple violations in its safety officer’s driving record, and decided to revoke its test license (vehicle with a safety officer) immediately. effective. Pony.ai has 41 self-driving test vehicles and 71 safety officers in California. At the end of October last year, Pony.ai’s completely unmanned self-driving test vehicle was involved in a traffic accident, and the relevant test license was suspended by the California Department of Motor Vehicles. Pony.ai said it was understanding the situation and that autonomous driving tests in China are proceeding normally.
Zhang Chaoyang responded that Sohu employees were deceived: the loss of funds was less than 50,000 yuan.
Some Sohu employees received a salary subsidy email from the company’s internal mailbox. After filling in their personal information, their bank card was stolen and swiped, and they were posted on Weibo today. Sohu CEO Zhang Chaoyang responded on Weibo that an employee’s email address was stolen, but the result was “not that serious” and the loss of funds did not exceed 50,000 yuan. Frauds related to technology companies have occurred from time to time this year, and more than one venture capital institution has issued a statement saying that someone has misappropriated its name to sell wealth management products.
Passenger car sales recovered significantly in the third week of May.
According to the data from the Passenger Federation, the average daily retail sales of passenger vehicles (sedans, MPVs, and SUVs) in the narrower sense in the third week of May were 42,000 units, 6% less than the same period last year, but a significant improvement. Sales in the first two weeks of May were 32,000 units (-21% year-on-year) and 35,000 units (-22%). It may be that with the return to normal operation in some areas, coupled with incentives such as discounts and policies, sales have picked up.
Shanghai Post has gradually resumed domestic express delivery for some individuals since May 25.
Shanghai Post said that from May 25, under the premise of meeting the requirements of epidemic prevention, “orderly recovery” of personal delivery EMS: Individual users (most people) of non-agreement customers can go to designated outlets for delivery when conditions permit. ; The personal delivery of the agreed customer can be delivered at the outlet by itself, or collected according to the agreement. Relevant departments have previously stated that it is expected that all express delivery companies in Shanghai will be able to fully resume personal delivery services from early June.
This year’s Apple Worldwide Developers Conference is still held online.
Apple’s 2022 annual developer conference will open at 1:00 am Beijing time on June 7, the third year in a row to be held online due to the epidemic. The recently held Microsoft Developer Conference (May 24-26) also chose an online format. Although many public events overseas have returned to offline, such as Berkshire Hathaway’s shareholder meeting. But the biggest tech companies remain cautious.
The founder of WeWork stepped on the hot spot and raised another $70 million.
Flowcarbon, the blockchain carbon credit trading platform co-founded by WeWork founder Adam Neumann, has raised $70 million in its first round of funding. Flowcarbon tokenizes carbon credits, allowing companies on the platform to use tokens to store and trade carbon credits. Neumann’s time at WeWork was controversial. After the IPO failed, the company’s value plummeted, and he was fired by investor SoftBank. But these scandals did not affect the well-known Silicon Valley venture capital A16Z led the investment in FLowcarbon.
Starbucks sells cold-pressed juice brands to focus on coffee.
Starbucks announced that it will sell its juice brand Evolution Fresh to fresh food maker Bolthouse Farms, focusing on its core business in the future. Starbucks bought Evolution Fresh for $30 million in 2011 to enter the premium juice market (the most expensive one is $7). Currently, Evolution Fresh products are mainly sold in Starbucks’ own stores and Amazon’s Whole Foods supermarkets.
Chanel is worried about the rich lining up to open exclusive stores for super customers.
After several rounds of price increases, the queue at Chanel’s entrance has grown longer and longer, until its management plans to open exclusive stores for high-spending customers. Chanel’s revenue in 2021 is US$15.6 billion, a year-on-year increase of 49.6%, an increase of 23% from before the epidemic, and a new high. Chanel said that about one-third of its stores in mainland China were closed due to the epidemic, and revenue fell by more than 10% in April, but growth in other regions offset the impact.
High-end retailer Nordstrom says affluent consumers are immune to inflation.
Amazon and Walmart, two of the world’s largest affordable retailers, have seen their stock prices plummet recently due to poor performance, both attributed to inflation affecting consumption and profits. But Nordstrom’s latest fiscal quarter (ended April 30) had net sales of $3.47 billion, up 19% from a year earlier. Management said its affluent customer base has a higher income profile and resilience, and has yet to see an adverse impact of inflation on its spending.
SoftBank-backed budget hotel chain OYO shelved its IPO.
According to media reports, due to concerns that the market downturn will affect the valuation, after discussions with investors, the Indian economy hotel chain OYO decided to shelve the IPO plan, which may be listed as early as 2023. It was previously reported that due to market volatility, OYO has lowered its IPO valuation twice this year, from $12 billion at the beginning, to $9 billion and $6 billion. Sequoia Capital is also its investor.
Prices rose faster than costs, and Ralph Lauren’s gross margins continued to improve.
Luxury brand Ralph Lauren’s latest fiscal quarter (as of April 2) revenue was 1.52 billion US dollars, an increase of 18% year-on-year; the adjusted gross profit margin for the year was 63.3%, compared with 62.9% in the same period last year. According to the management, although the cost of raw materials, freight and labor are all rising, the gross profit margin this year is expected to increase by another 0.3 to 0.5 percentage points due to the price increase. As social activity increases, so does the demand for apparel from high-income customers.
Costs rose and demand fell, and A&F’s stock price fell by 30% in one day.
In the three months ended April 30, Abercrombie & Fitch’s revenue increased by 4% year-on-year to $810 million, but an unexpected loss of $14.8 million; ending inventory amounted to $563 million, a year-on-year increase of 45%. The management said that in the previous holiday season, due to logistics congestion, A&F chose to ship clothes by air, but the sales were not as good as expected, and they had to sell off their warehouses after the holiday. A&F lowered its sales and profit margin forecasts for this year, and the stock price fell by nearly 30% in one day, the biggest drop in a single day.
Singapore’s GDP grew 3.7% in the first quarter, as trade faced pressures from geopolitical conflicts and the Asian epidemic.
Singapore’s GDP grew by 3.7% in the first quarter of this year, a slowdown from 6.1% in the previous quarter. Singapore officials said that compared with three months ago, the outlook for external demand has weakened, and the annual growth forecast of 3%-5% remains unchanged, but the actual growth rate may be at the lower end of the range. Singapore is reliant on trade, geopolitical conflicts and the outbreak in China all have a major impact on its economy; inflation can also dampen the purchasing power of local households.
Text | He Ganming, Dou Yajuan, Lin Guangying, Intern Wang Yuqing
Editor | Huang Junjie
This article is reprinted from: https://www.latepost.com/news/dj_detail?id=1152
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