 | Nov 13, 2024 | | | | Supported by  | | | | | Good morning! Wonder, the food delivery company run by former Walmart and Amazon executive Marc Lore, is in talks to buy Grubhub. Donald Trump formally named Elon Musk to help lead a commission to reduce government bureaucracy. Spotify's price increases have boosted its earnings.
| | | | Wonder, the food delivery company run by former Walmart and Amazon executive Marc Lore, is in talks to acquire food delivery service Grubhub, the Wall Street Journal reported Tuesday. Grubhub's parent company, Amsterdam's Just Eat Takeaway, has been trying to sell the delivery service since 2022 after acquiring it for over $7 billion in 2021. Grubhub will likely be valued at less than $1 billion if the Wonder deal goes through, according to the Journal. Grubhub is in a distant third place in the U.S. restaurant delivery market behind DoorDash and Uber Eats. Wonder, which sells and delivers a wide variety of food from its own restaurants, has made several other acquisitions recently, including the meal kit seller Blue Apron last year and the white-label delivery service Relay this year. Wonder has raised a total of $1.55 billion, according to PitchBook. | | | | Donald Trump formally named Elon Musk to help lead a commission to reduce government bureaucracy, following through on an idea Trump had floated during his presidential campaign. In a statement on his account on Truth Social, Trump said that Musk will co-lead the Department of Government of Efficiency with Vivek Ramaswamy, the former Republican presidential candidate. The acronym for the effort, DOGE, is an apparent reference to Dogecoin, a cryptocurrency Musk has supported in the past. "This will send shockwaves through the system, and anyone involved in Government waste, which is a lot of people," Musk said in the statement from president-elect Trump. Trump said Musk and Ramaswamy will finish their efforts no later than July 4, 2026. During Trump's campaign, Musk promised to identify $2 trillion in cuts to the federal government's budget, about 30% of its total spending during the last fiscal year, if Trump won. | | | | BuzzFeed warned investors that it doesn't have enough cash to cover the nearly $120 million it expects it will have to pay convertible note holders back in the coming weeks, saying it will have to renegotiate terms or try to find other financing. CEO Jonah Peretti said the company will share an update on its debt, balance sheet and fourth-quarter outlook in the coming weeks, as well as the results of a strategic review process it initiated last year. BuzzFeed ended the third quarter with approximately $54 million in cash. The company reported 7% growth in revenue to $64.3 million in the third quarter of 2024, driven by increases in its commerce business, offsetting a slight dip in ad revenues. | | | | Spotify's recent price rises appear to have boosted its financial performance. The music streaming service reported 19% growth in revenue to 3.98 billion euros, while operating income surged to 454 million euros compared with 32 million euros a year earlier. The music streaming service said premium subscribers—those paying for a subscription—rose 12%. But revenue from the premium business rose 21%, thanks to price increases. The higher revenue is flowing through to Spotify's bottom line. The company reported 711 million euros in free cash flow, compared with 210 million euros a year earlier. | | | | Shopify's revenue grew 26% in the third quarter from a year earlier to $2.16 billion and its free cash flow margin rose to 19%, topping its previous forecast for the quarter by roughly three percentage points. The e-commerce giant has been highlighting improvements in its margins ever since it unloaded its money-losing logistics business to freight company Flexport in 2023. Free cash flow rose to $421 million, a 52% increase from a year earlier. The company, which generates revenue from payments and other merchant services as well as selling software subscriptions, said its gross profit margin dipped slightly as payments volumes grew during the quarter. Payments, the biggest source of Shopify's revenue, is lower-margin than its software business, because Shopify pays some of what it charges merchants back out to its payments processors. Shopify shares surged more than 20% in Tuesday morning trading. | | | | Netflix said its ad-supported subscription tier is seeing momentum, announcing that it has now reached 70 million monthly active users globally. That is up from 40 million monthly active users in May. More than 50% of new Netflix sign-ups are now also for the ad tier in the countries that plan is available in, the company said in a blog post. (Netflix's monthly active user metric is not equal to a paid subscriber, as multiple people can be viewing on the same subscription.) Netflix has also been making several bets on live sports and related content in an effort to draw more viewers and help with its advertising business. Chief among them is its plan to exclusively live stream two Christmas Day NFL games later this year. Netflix said the commercial time for both games have been sold out, with sports-betting service FanDuel and Verizon as two of the key sponsors for the games. Among other updates, Netflix said it has launched its own in-house ad server in Canada. It plans to roll that out globally next year. | | | | Snowflake, at its annual conference for developers, unveiled a preview of a forthcoming product that lets customers ask questions and get answers from the information they store in its database, as well as third-party products like Salesforce and Google Workspace. The product includes tools for building chatbots that can independently take actions based on the information, also known as AI agents. This is a significant step for Snowflake that helps raise its profile in enterprise AI and also positions it to compete for internal search business with startups like Glean and companies like Elastic NV. It comes amid a flurry of activity in this segment that includes recent new features from Dropbox and Perplexity that aim to make it easier for employees to find corporate documents and information. | | | | Instacart on Tuesday reported $852 million in revenue for the third quarter, representing 12% year-over-year growth. Its earnings before interest, taxes, depreciation and amortization rose 39% to $227 million. The grocery delivery firm also reported $8.3 billion in total gross transaction value in the quarter, which was up 11% year over year and slightly higher than the guidance it had given for the July-through-September period. Instacart said it expects $8.5 billion to $8.65 billion in gross transaction value for the fourth quarter. Instacart shares fell around 3.3% to $46.75 in after-hours trading. | | | | Rajeev Misra will step down as co-CEO of Japanese investment company SoftBank's Vision Fund, the company announced on a call with investors Tuesday. Upon Misra's departure, co-CEO Alex Clavel will become sole CEO of the giant startup fund. Misra helped raise the $100 billion fund in 2017 from investors including Saudi Arabia and United Arab Emirates' wealth funds, as well as Apple. The fund made a name for itself by writing huge checks at steep valuations in pursuit of SoftBank CEO Masayoshi Son's vision of an artificial intelligence-connected future. In recent years, Son and his lieutenants have tried to recover from the failures of some high-profile investments, including WeWork, construction startup Katerra and pizza maker Zume. More recently, however, the Vision Fund has been generating investment gains, thanks to initial public offerings of portfolio companies in India and increased stock prices of public companies, such as South Korean e-commerce firm Coupang. In a return to its past swagger, the Vision Fund was expected to invest $500 million in OpenAI, The Information reported. Misra began stepping away from his role two years ago, as he started his own firm One Investment Management. | | | | OpenAI co-founder and president Greg Brockman has returned to the startup, three months after he said he would take an extended leave of absence, according to a message he sent to staff Tuesday. Brockman's new role has not yet been finalized, he said, but would focus on solving the artificial intelligence developer's most difficult technical challenges. The Information first reported on Brockman's upcoming return in October, not long after Chief Technology Officer Mira Murati resigned. Murati and her team had butted heads with Brockman over the company's development of new technology, which partly explained why he went on leave. Her departure may have made it easier for him to return sooner. An OpenAI spokesperson confirmed Brockman's return. Bloomberg first reported on Brockman's return to the company. | | | | | Popular articles By Stephanie Palazzolo, Erin Woo and Amir Efrati
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