Key Events
👉Uber posts earnings, report large equity markdown
Uber’s Q1 results on Wednesday came in slightly above estimates for revenue and EPS, but an unexpected loss caused the stock to slide 5%.
Uber’s net loss in Q1 was $654M, which was a sharp y/y decline from $156M. The company said on Wednesday that its net loss was due to $721M in unrealized losses from their equity investments.
An unrealized loss occurs when a company’s investment decreases in underlying value, but the investment has yet to be sold.
Debt and equity investments must be categorized as…
- Trading
- Available-for-sale
- Held-to-maturity
Any changes to fair value of securities that are held for trading, which is short-term in nature, must be reflected on the income statement. However, securities that are available-for-sale and held-to-maturity do not affect the income statement. The changes in value of available-for-sale securities flow through accumulated other comprehensive income and then get reversed at the time the gains/losses are realized.
👉Shopify shares plunge 18% after earnings
Shopify reported earnings on Wednesday and beat EPS and revenue estimates, but the company’s Q2 guidance has investors concerned.
Shopify has reported y/y revenue growth above 20% for the past six quarters, but the company said they estimated revenue growth to slow moving forward.
The company said slower growth stems from lower consumer spending in Europe and headwinds in foreign exchange markets due to the strong U.S. dollar.
👉T-Mobile and Verizon look to carve up U.S. Cellular
T-Mobile and Verizon are in discussion for separate deals to carve up U.S. Cellular, one of the country’s last major regional wireless carriers, per WSJ.
T-Mobile could close a deal this month that includes a portion of the U.S. Cellular’s operations and wireless licenses for $2B.
Antitrust will be a concern. So the split-sale structure attempts to curb concerns of the authorities.
Mergers and Acquisitions
SoftBank is looking to acquire Graphcore, a semiconductor startup once valued at $3B.
Private Equity
Blackstone and Vista complete their $1.6B acquisition of Energy Exemplar.
Initial Public Offerings
Proficient Auto Logistics raised $215B offering 14.3M shares at $15.
Venture Capital
Atlan raises a $105M series C at a $750M valuation.
