Tag Archives: Etailing

Business

The main attractions arrive: Apple, Microsoft, Google, Facebook, Amazon and Tesla headline the biggest week of earnings

Leave a comment

The coming week will be the most important of this quarter’s earnings season — even if later weeks beat it on quantity, it will be nearly impossible to top this slate in terms of dollars and attention.

That is because all of Big Tech will report, and those five companies — Google parent Alphabet Inc.
GOOGL,
+3.58%
GOOG,
+3.37%,
e-commerce and cloud-computing powerhouse Amazon.com Inc.
AMZN,
+0.51%,
iPhone maker Apple Inc.
AAPL,
+1.20%,
social-media titan Facebook Inc.
FB,
+5.30%
and software giant Microsoft Corp.
MSFT,
+1.23%
— can determine the course of the market at this point in history.

Consider these stats, from Dow Jones Market Data Group:

  • The five Big Tech companies comprised more one-fifth of the total market cap of the S&P 500 index
    SPX,
    +1.01%
    as of the end of the second quarter, 22%.
  • In the first quarter, they provided nearly 10% of the total sales of the 500-member index, and nearly 18% of the total profit (9.7% and 17.8%, respectively).
  • That proportion of profit provided by Big Tech actually decreased from 2020, when the five companies provided nearly a quarter of the index’s full-year earnings, 23.8%, and accounted for 9.1% of the total sales.

In the coming week, the five companies are expected to reveal some large earnings and sales for the second quarter, which can typically be slower ahead of back-to-school and holiday shopping in the second half of the year. Collectively, they are expected to report profit of nearly $60 billion on sales of more than $310 billion, according to analysts’ estimates collected by FactSet.

Those estimates are likely conservative. So far this quarter, 88% of S&P 500 companies have surpassed analysts’ average estimates for earnings per share, and 86% have beaten on revenue with nearly a quarter of the index reporting, according to FactSet. Both of those figures would be records for overall surprise percentage, which FactSet has tracked back to 2008, according to senior earnings analyst John Butters.

Facebook and Google, for example, are widely expected to outdistance estimates after fellow online ad-sales companies Snap Inc.
SNAP,
+23.82%
and Twitter Inc.
TWTR,
+3.05%
blew away expectations in their reports last week, which helped boost Alphabet and Facebook to record stock highs Friday, along with Snap.

See also: Facebook earnings preview and Alphabet earnings preview

Stock movement is unlikely to be determined by the numbers those companies report, especially after the big bounce on Friday; forecasts have been more important for investors as they wait to see how long the current boom in corporate earnings will last. And all five companies have been careful with their forward-looking statements during the COVID-19 pandemic.

Apple has stopped providing guidance during the pandemic, which will obstruct the annual parlor game of trying to glean facts about the coming iPhone release from the company’s financial forecast. While Microsoft is expected to wrap up its fiscal year by breaking the records it put up the year before by a healthy amount, it will likely only provide official financial guidance for the coming quarter instead of the full year, as executives have done in the past.

Full earnings preview: What will Apple say about the next iPhone at earnings time? Maybe more than usual

Most Big Tech forecasts that have been shared ended up undershooting their actual performance, which can keep expectations low and produce big beats. Amazon, for instance, topped the highest end of its sales forecast by 2.3% in the first quarter, which equates to an additional $2.5 billion. And that was actually the closest Amazon came to an accurate prediction in Big Tech’s $1.2 trillion pandemic year, after beating the top end of its quarterly guidance by 3.8%, 3.4% and 9.8% looking backward from the fourth quarter.

So expect at least a couple of big earnings beats and a lot of questions about what comes next as these reports flood in during the week. Apple, Google and Microsoft all expect to report on Tuesday afternoon following the close of markets, while Facebook follows Wednesday afternoon and Amazon wraps it up on Thursday afternoon.

The call to put on your calendar
  • Tesla Inc. When Tesla
    TSLA,
    -0.91%
    Chief Executive Elon Musk speaks, the markets listen.

The most controversial CEO in Silicon Valley has sent cryptocurrencies like bitcoin
BTCUSD,
+4.38%
and dogecoin
DOGEUSD,
+3.44%
on crazy rides with his tweets and pronouncements so far this year, but when he kicks off the week’s after-hours earnings slate Monday afternoon, the focus should be on Tesla and its stock.

As always, there are plenty of issues to discuss with the electric-car manufacturer. After the departure of a longtime executive, the progress of Tesla’s Semi road map will need to be addressed, as will the gross-margin effects of the continuing semiconductor shortage, an issue across the automotive industry.

Full Tesla earnings preview: Semi truck, Cybertruck pickup and chip shortage in focus

Tesla is also likely to address its plans to sell its advanced driver-assistance features as a subscription package, even as Consumer Reports joins in a chorus of criticism about Tesla’s approach to autonomous driving. Musk’s recent pronouncement that Superchargers will be opened to electric vehicles from other manufacturers, as well as demand amid heated competition in China will also be topics to look for.

Also watch for chip-shortage commentary from other, more staid automakers, such as Ford Motor Co.
F,
-0.65%
on Wednesday, as well as chip supplier Qualcomm Corp.
QCOM,
+1.71%.

  • Hasbro Inc. and Mattel Inc. Could there be a more worrisome phrase than “toy shortage” as we approach the holiday shopping season?

Well, analysts raised the alarm last week that we could face exactly that, after parents purchased bundles of toys out of season to keep their kids entertained while home from school during the COVID-19 pandemic, which put a crimp on the industry’s supply chain. Expect executives to address any problems at Santa’s workshop when Hasbro
HAS,
-0.89%
reports on Monday and Mattel
MAT,
-1.60%
follows on Tuesday.

The numbers to watch
  • Boeing Co.’s bottom line. Boeing
    BA,
    +0.29%
    is expected to post another loss in the quarter, but analysts predict that it will go against the grain and post a loss much wider than the average consensus. “We think Boeing is set to announce another monster 2Q loss, with a free cash outflow of ~$2.8bn by our estimates,” Vertical Research analysts said, while Benchmark analyst Josh Sullivan predicted last week that Boeing would top $1 a share in losses, while the average analyst estimate currently is looking for a loss of about 83 cents a share.
  • Fast food sales. After strong reports last week from Chipotle Mexican Grill Inc.
    CMG,
    +1.81%
    and Domino’s Pizza Inc.
    DPZ,
    -2.48%,
    burger makers and other casual dining chains will detail if their pandemic-influenced boom continued as certain areas of the U.S. opened up. On the schedule this week are McDonald’s Corp.
    MCD,
    +1.80%,
    Shake Shack Inc.
    SHAK,
    +0.63%,
    Yum Brands Inc.
    YUM,
    +2.10%
    (and Yum China Holdings Inc.
    YUMC,
    +0.65%
    ), and Wingstop Inc.
    WING,
    +1.20%.
    Also look for signs of change from chain restaurants that depend more on in-house traffic but pivoted to more takeout during the pandemic, such as Cheesecake Factory Inc.
    CAKE,
    -0.31%
    and Bloomin’ Brands Inc.
    BLMN,
    +0.55%.
This week in earnings

Exactly one-third of the 30 Dow Jones Industrial Average
DJIA,
+0.68%
components and more than one-third of the S&P 500 components, up to 180, are expected to report earnings in the coming week, according to FactSet. Notable reports from outside the major indexes include Canadian e-commerce platform Shopify Inc.
SHOP,
+3.09%
and streaming-music service Spotify Inc.
SPOT,
-0.22%
reporting on the same morning Wednesday, which is bound to produce some confusion between the two similarly named companies, as well as growing Silicon Valley software maker Twilio Inc.
TWLO,
+1.07%
on Thursday afternoon.

Dow Jones Industrial Average reports: 3M Co.
MMM,
+0.71%,
Apple, Microsoft and Visa Inc.
V,
+2.00%
(Tuesday); Boeing and McDonald’s (Wednesday); Merck & Co. Inc.
MRK,
+1.32%
(Thursday); Caterpillar Inc.
CAT,
+0.18%,
Chevron Corp.
CVX,
+0.04%
and Proctor & Gamble Co.
PG,
+1.44%
(Friday)

Read original article here

Business

Jeff Bezos’ Blue Origin Targets Bigger Space Goals

Leave a comment

Jeff Bezos

’ plans for space go far beyond the short trip he is slated to take there Tuesday.

The

Amazon.com Inc.

AMZN -1.59%

founder has poured billions into his Blue Origin LLC space venture over more than two decades, believing humanity must ultimately establish outposts across the solar system.

More immediately, Mr. Bezos’ company is seeking business in a space market that will triple in size to more than $1 trillion in annual sales by 2040, Morgan Stanley says, assuming rapid technological developments enable routine moon landings, asteroid mining and space tourism.

Blue Origin’s crew capsule interior. The company has spent years developing rockets, engines and vehicles.



Photo:

Blue Origin

His own giant leap comes when Blue Origin is scheduled to launch Mr. Bezos and three other people to the edge of space in an 11-minute flight, the first launch with passengers on the company’s New Shepard rocket.

A successful trip could provide traction in an emerging space-tourism market, which includes

Richard Branson’s

Virgin Galactic Holdings Inc.

Blue Origin’s broader challenge is winning the kind of large government contracts that provide a steady revenue stream and lend credibility to companies that secure them. Space Exploration Technologies Corp., the formal name for

Elon Musk’s

SpaceX, has jumped ahead of Blue Origin in winning those deals.

For years, Blue Origin has been building up operations and developing a portfolio of rockets, engines and vehicles. That push has been animated by what Mr. Bezos has described as his passion for space. He has cited the Apollo 11 moon-landing mission as a foundational moment for him and referenced science-fiction writers like Arthur C. Clarke and the scientist and author Carl Sagan in speeches.

A New Shepard rocket launch.



Photo:

Blue Origin

“If we’re out in the solar system, we can have a trillion humans in the solar system, which means we’d have a thousand Mozarts and a thousand Einsteins. This would be an incredible civilization,” Mr. Bezos said during a speech two years ago. To that end, Blue Origin can lower the cost of space launches, in part by developing reusable rockets, Mr. Bezos has said.

The talk from the Amazon founder has been paired with major financial commitments. Mr. Bezos has disclosed he has sold $1 billion in Amazon stock annually to fund Blue Origin.

After founding Blue Origin in 2000, Mr. Bezos began acquiring hundreds of thousands of acres of land in West Texas for the company in the early part of that decade, telling a newspaper in the area in 2005 he wanted to build a rocket launchpad on the property.

Now, in addition to the launch site in Texas, the company has facilities in Florida, California, Alabama and Washington, D.C., as well as headquarters outside of Seattle. It employs more than 3,500 people, including Chief Executive

Bob Smith,

a former executive at

Honeywell International Inc.’s

aerospace unit. The privately owned Blue Origin doesn’t release financial statements.

Mr. Bezos is “doing what he did with Amazon, which is to roll over every nickel he could get into capital equipment and innovation,” said

Howard McCurdy,

a professor at American University who has written about space and the National Aeronautics and Space Administration.

Richard Branson successfully traveled to the edge of space on Sunday, and Jeff Bezos isn’t far behind. But the two billionaire founders’ spacecrafts, flight logistics and altitudes have some differences. Photo illustration: Laura Kammermann

This year, Blue Origin intends to conduct two additional flights with passengers on the New Shepard following Tuesday’s launch, executives said Sunday at a briefing. Mr. Smith didn’t specify how much the company is selling tickets for.

“Willingness to pay continues to be quite high. Our early flights are going for a very good price,” he said.

Outside of the emerging space-tourism market, SpaceX has gained a deeper footing with space-related agencies in Washington. NASA and the Pentagon have spent $2.8 billion tied to 52 prime contracts won by the company led by Mr. Musk over the past 14 federal fiscal years, according to a federal spending database. They have spent $496.5 million in 33 contracts won by Blue Origin over that period.

Blue Origin didn’t respond to questions about competition with SpaceX or its plans for working with government agencies. Mr. Smith has in the past said the company wants to gain work with such customers.

The two companies are sparring over a deal to build a moon lander for a trip planned for 2024. The Apollo 11 moon lander reached the moon in 1969 on July 20, the same date for Mr. Bezos’ scheduled space trip on Tuesday. NASA awarded SpaceX the lander contract in April, but Blue Origin protested that decision with the U.S. Government Accountability Office, a move that could lead to NASA rebidding the contract.

The accountability agency is expected to issue a decision on Blue Origin’s case by Aug. 4. The Dynetics unit of

Leidos Holdings Inc.

also competed for the lander and filed a protest.

SpaceX is now the most prolific launcher, sending up 23 rockets so far this year, according to Federal Aviation Administration data covering licensed launches. Its reusable rockets help cut the cost of reaching space, a strategy also pursued by Blue Origin, which has completed nine such launches since late 2017.

“They need to have a track record,” said

Marco Cáceres,

a space analyst at aerospace consulting firm Teal Group, referring to Blue Origin.

The New Shepard rocket scheduled to go up Tuesday has been designed for tourist trips into suborbital space, with a six-person gumdrop-shaped capsule and windows stretching 3.5 feet by 2.3 feet along its sides. Along with the Amazon founder, the craft’s passengers are Mark Bezos, Mr. Bezos’ brother; Wally Funk, an 82-year-old pilot who graduated in the 1960s from a program for female astronauts; and Oliver Daemen, an 18-year-old Dutch student, the company’s first paying customer.

The company also has been developing the New Glenn rocket, a vehicle that will stand 321 feet tall and is designed to use seven main engines to lift large payloads to orbit. In February, Blue Origin said it had made progress on several hardware components for the rocket and that it was targeting a maiden flight for New Glenn toward the end of next year.

Blue Origin has struck deals to push its technology into the space market. The company is developing a new rocket engine for United Launch Alliance, which launches satellites for the Pentagon and U.S. spy agencies. The engine, which will replace the Russian-made motors now used, is behind schedule. Last week, NASA said Ultra Safe Nuclear Technologies, a Seattle company, would join with Blue Origin,

General Electric Co.

and other firms to design concepts for nuclear-propulsion systems that could power vehicles into deep space.

Blue Origin’s “aspirations are to become a company like SpaceX, like

Boeing,

like

Lockheed Martin,

” said

John Logsdon,

the former director of the Space Policy Institute at George Washington University.

Write to Micah Maidenberg at micah.maidenberg@wsj.com and Doug Cameron at doug.cameron@wsj.com

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Read original article here

Business

Facebook Seeks Recusal of FTC Chair Lina Khan in Antitrust Case

Leave a comment

WASHINGTON—

Facebook Inc.

sought the recusal of Federal Trade Commission Chairwoman Lina Khan from the agency’s deliberations on whether to file a new antitrust case against the company, arguing she couldn’t be impartial because of her long history of criticizing it and other big-tech firms.

“Chair Khan has consistently made public statements not only accusing Facebook of conduct that merits disapproval but specifically expressing her belief that the conduct meets the elements of an antitrust offense,” the company said Wednesday in a formal recusal petition filed with the FTC.

“When a new commissioner has already drawn factual and legal conclusions and deemed the target a lawbreaker, due process requires that individual to recuse herself,” Facebook said in the petition.

An FTC spokeswoman didn’t immediately respond to a request for comment. Ms. Khan has said previously that she would consult with FTC ethics officials if recusal questions arose.

Facebook’s request comes two weeks after a similar recusal petition was filed by

Amazon.com Inc.,

which is facing multiple investigations at the FTC, and is the latest sign that giant technology companies are favoring aggression over a conciliatory approach with Ms. Khan, who built her career advocating for bold antitrust action to rein in the dominant players in Silicon Valley.

President Biden installed Ms. Khan as the head of the FTC last month, part of a growing administration effort to restrain corporate power.

Twitter CEO Jack Dorsey and Google CEO Sundar Pichai stopped short of endorsing changes proposed by Facebook CEO Mark Zuckerberg to Section 230, a law that spells out who is legally responsible for content on the internet. Photo: C-SPAN

The FTC soon must decide whether to file a new antitrust lawsuit against Facebook after a judge threw out the FTC’s previous complaint as legally insufficient. Because of the approaching deadlines in the case—the judge’s June 28 ruling gave the FTC 30 days to file an amended lawsuit—it could force Ms. Khan to confront the recusal issue on an accelerated timeline.

Ms. Khan has been a prolific writer about antitrust issues, especially as they related to big tech companies. She previously worked for a progressive antitrust advocacy group and was a key staffer on a congressional antitrust panel that conducted a 16-month investigation of large online platforms and last year recommended that lawmakers take steps to rein them in.

The FTC’s vote on a new Facebook lawsuit is likely to be a divided one. Democrats hold a 3-2 commission majority; if Ms. Khan sat out, there likely wouldn’t be a majority to sue Facebook again. The commission’s two Republican commissioners voted against the first lawsuit the FTC filed against Facebook in December.

The FTC, along with 46 states, had alleged Facebook was engaged in illegal monopolization, including by buying up other companies such as WhatsApp and Instagram to prevent them from challenging Facebook’s market position. The company denied the allegations, saying it competed fairly and achieved success because its services are popular with consumers.

In last month’s ruling, U.S. District Judge

James Boasberg

in Washington dismissed the FTC’s case at the outset of pretrial proceedings, saying the FTC didn’t plead enough allegations to support monopolization claims against Facebook. He also said the FTC didn’t have a valid challenge to Facebook’s policy of refusing to grant interoperability permissions to competing apps. The judge gave the commission 30 days to file a new lawsuit that attempts to make more detailed allegations.

Under the governing legal standards for recusal, a company seeking a commissioner’s disqualification on the grounds of prejudgment must show that a disinterested observer could conclude that the commissioner had already judged both the facts and the law in advance of a proceeding.

Ms. Khan gets to decide in the first instance how to address Facebook’s request for her disqualification. Past FTC practices show that, at least in some circumstances, the whole commission can weigh in.

Disqualification requests haven’t seen much success in modern times, but there are older court rulings that vacated FTC enforcement actions on the grounds that a commissioner should have been disqualified.

Write to Brent Kendall at brent.kendall@wsj.com

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Read original article here

Business

President Biden’s Executive Order Opens New Front in Battle With Big Tech

Leave a comment

WASHINGTON—President Biden’s sweeping new competition order targets big tech companies in ways that could fundamentally alter how they do business.

But it will fall to government agencies to carry out the order, and they could take years to put its ideas into action. The Federal Trade Commission that already has Big Tech companies in its sights is likely to become a particular battleground.

A core thrust of the order is to encourage regulatory agencies such as the FTC to adopt new rules and policies to rein in the growing size and power of large tech platforms such as Amazon.com Inc., Alphabet Inc.’s Google and Facebook Inc. That could prove to be a tall order for the FTC, the principal federal regulator of internet commerce. Some observers say the agency—which had its sails trimmed by Congress in the deregulatory era of the 1970s and 1980s—has struggled to keep up with unfair practices online, particularly in the areas of user privacy, big data and tech mergers.

As the White House detailed its executive order, one Democratic FTC commissioner, Rebecca Kelly Slaughter, said in a tweet, “So excited about @POTUS’s EO on competition; it is an ambitious agenda that will help our markets work better and create a more equitable economy for all people – esp workers, marginalized communities, entrepreneurs, small biz.”

Gary Shapiro, chief executive of the Consumer Technology Association that counts Apple Inc., Facebook and Google among its members, defended the tech industry as competitive and vibrant and took issue with the White House’s action.

Read original article here

Business

Stamps.com to Be Bought by Thoma Bravo in $6.6 Billion Cash Deal

Leave a comment

Stamps.com agreed to be acquired by private-equity firm Thoma Bravo in an all-cash deal that values the e-commerce shipping software company at about $6.6 billion.

Stamps.com stockholders will receive $330 a share in cash, a 67% premium over the company’s $197.72 closing price Thursday.

When the deal is complete, Stamps.com will become a private company. Stamps.com said it would benefit from the operating capabilities, capital support and sector expertise of software and technology investor Thoma Bravo. Thoma Bravo said Stamps.com is well-positioned to capitalize on tailwinds in e-commerce.

The deal agreement includes a 40-day “go-shop” period expiring Aug. 18, which allows Stamps.com’s board and its advisers to initiate, solicit and consider alternative acquisition proposals from third parties. The companies expect the transaction to close in the third quarter.

Shares of Stamps.com jumped 64% Friday to $323.86 in midday trading.

Read original article here

Business

ThredUp’s Stock Jumps 30% in Market Debut

Leave a comment

Shares of ThredUp Inc. opened 30% above the listing price in their market debut Friday, an early sign that investors continue to be bullish on online secondhand retail.

The Oakland, Calif.-based retailer’s stock began trading at $18.25, after being set at $14, which was the high end of its previously announced range. At the listing price, ThredUp, which sold 12 million shares, raised $168 million at a valuation of about $1.3 billion.

ThredUp will use the proceeds to expand the business, including adding new categories, and make new investments in the company’s operating platform and technology, co-founder and Chief Executive James Reinhart said in an interview Friday. The initial public offering is “just another validation of the market opportunity, and ThredUp plays in the biggest, fattest part of the market at our price point,” he said.

ThredUp, which sells women’s and children’s apparel, posted $186 million in revenue last year, a 14% jump from the previous year, according to a filing with the Securities and Exchange Commission. The company lost $48 million last year, compared with a loss of $38 million in 2019.

The company said it had 1.2 million active buyers at the end of last year, up 24% from the previous year. On average, those shoppers visited ThredUp six times a month and placed 3.2 orders in the year. The company defines active buyers as customers who have made at least one purchase in the past 12 months. “Customers are continuing to be engaged on our platform and continue to shop at higher rates,” Mr. Reinhart said. “I think it shows remarkable resilience.”

Read original article here

Business

Beijing Asks Alibaba to Shed Its Media Assets

Leave a comment

China’s government has asked

Alibaba Group Holding Ltd.

BABA -2.10%

to dispose of its media assets, as officials grow more concerned about the technology giant’s sway over public opinion in the country, according to people familiar with the matter.

Discussions over the matter have been held since early this year, after Chinese regulators reviewed a list of media assets owned by the Hangzhou-based company, whose mainstay business is online retail. Officials were appalled at how expansive Alibaba’s media interests have become and asked the company to come up with a plan to substantially curtail its media holdings, the people said. The government didn’t specify which assets would need to be unloaded.

Alibaba, founded by billionaire

Jack Ma,

has throughout the years assembled a formidable portfolio of media assets that span print, broadcast, digital, social media and advertising. Notable holdings include stakes in the

Twitter

-like Weibo platform and several popular Chinese digital and print news outlets, as well as the South China Morning Post, a leading English-language newspaper in Hong Kong. Several of these holdings are in U.S.-listed companies.

Such influence is seen as posing serious challenges to the Chinese Communist Party and its own powerful propaganda apparatus, the people said.

The party’s propaganda department didn’t reply to a faxed request seeking comment.

Alibaba declined to comment on discussions with regulators pertaining to possible media asset disposals. In a statement, the company said it is a passive financial investor in media assets.

“The purpose of our investments in these companies is to provide technology support for their business upgrade and drive commercial synergies with our core commerce businesses. We do not intervene or get involved in the companies’ day-to-day operations or editorial decisions,” the statement said.

The asset-disposal discussions are the latest development in a series of run-ins between Beijing and Mr. Ma, who was once China’s most-celebrated entrepreneur. Late last year, Chinese leader

Xi Jinping

personally scuttled plans by Ant Group Co.—Alibaba’s financial-technology affiliate—to launch what would have been the world’s largest initial public offering, amid growing unease in Beijing over Ant’s complex ownership structure and worries that Ant was adding risk to the financial system. Mr. Xi was also angry at Mr. Ma for criticizing his efforts to strengthen financial oversight.

Antitrust regulators are also preparing to levy a record fine in excess of $975 million over what they call anticompetitive practices on Alibaba’s e-commerce platforms, The Wall Street Journal previously reported citing people with knowledge of the matter. In addition, Alibaba would be required to end a practice under which, regulators believe, the tech giant forbade merchants to sell goods on both Alibaba and rival platforms.

Beyond media and online retail, Alibaba also has a sizable entertainment division, consisting mainly of Hong Kong-listed

Alibaba Pictures Group Ltd.

and Youku Tudou Inc., one of China’s largest video streaming platforms. Officials also reviewed Alibaba’s entertainment portfolio, although outright divestitures in that part of Alibaba’s business may not be necessary, people familiar with discussions related to Alibaba’s entertainment business said.

It isn’t clear whether Alibaba will need to sell all of its media assets. Any plan that Alibaba comes up with will need approval from China’s senior leadership, people familiar with the matter said.

Concerns have been growing in recent years in China’s officialdom over Alibaba’s media clout and how the company may have leveraged its investments in news and social media to influence government policies deemed unfavorable to its businesses.

Those concerns grew following an incident in May last year when scores of Weibo posts about a senior Alibaba executive’s alleged involvement in an extramarital affair were deleted.

After Jack Ma criticized Chinese regulators, Beijing scuttled the initial public offering of his fintech giant Ant and he largely disappeared from public view. WSJ looks at recent videos of the billionaire to show how he got himself into trouble.

An ensuing investigation by the Cyberspace Administration of China, the country’s internet watchdog, found that Alibaba was responsible for the interference with Weibo posts and said the company had used “capital to manipulate public opinion” in a report to the leadership, the Journal has reported, citing officials who saw the report. It is the Communist Party that controls public opinion on all media platforms and the private sector should not take up the role, the officials said.

Alibaba owns about 30% of Nasdaq-listed Weibo Corp. and has been the largest customer of the social-media company, having contributed nearly $100 million in advertising and marketing revenue in 2019 to its platform, according to the most recent annual data available.

In June, the internet watchdog publicly reprimanded Weibo for what it called “interference with online communication” and asked it to rectify the situation. In November, Xu Lin, a vice-director of the Party’s central propaganda department, said in a public forum that China must “resolutely prohibit dilution of the party’s leadership in the name of [media] convergence, resolutely guard against risks of capital manipulating public opinion.”

He didn’t identify Alibaba by name during his speech but used the words that appeared in the cyber watchdog’s report.

Divesting its media interests isn’t necessarily a big negative for Alibaba, which could re-emerge from the regulatory onslaught in a more secure position with Beijing after giving up some noncore assets. It could also help steer the company clear of future political minefields as authorities maintain a tight grip on the media.

Alibaba isn’t the only Chinese tech giant that dabbles in media.

Tencent Holdings Ltd.

’s WeChat messaging service has become one of the primary ways in which ordinary Chinese people get news. Bytedance Ltd. operates popular news aggregator Jinri Toutiao, which employs artificial intelligence to push news to hundreds of millions of users.

It isn’t clear if any other tech companies will have to follow the same pattern as Alibaba in considering the disposal of media assets.

Alibaba’s media investments began before the company rose to international fame with its then record-breaking IPO on the New York Stock Exchange in 2014. Over the years, Alibaba and Ant purchased stakes in some of the country’s most popular media outlets, including business-focused Yicai Media Group and tech-focused news portals Huxiu.com and 36Kr.com.

One of the most prominent acquisitions was the South China Morning Post, which traces its roots to the era of British colonial rule in Hong Kong. Alibaba has also set up joint ventures or partnerships with powerful state-run media like Xinhua News Agency and local government-run newspaper groups in Zhejiang and Sichuan provinces.

Media outlets often met Alibaba’s overtures with enthusiasm, given the tech giant’s deep pockets and digital expertise. Since being bought by Alibaba in 2016, the Post has expanded its digital news offerings and editorial staff and completed a makeover of its Hong Kong headquarters.

Some journalists and readers worried that Alibaba, which has offices a few floors above the Post’s newsroom, would interfere with the paper’s coverage to please Beijing. But the newspaper at times published stories that appeared unfavorable to the Chinese leadership, including extensive coverage of Hong Kong’s 2019 and 2020 protests and Beijing’s growing control over the city.

Mr. Ma, explaining the reasons for his acquisition of the Post, said in a public forum in 2017 that he never interfered with newsroom operations and respected journalism.

“[We] must not let the media fall, must not let the media lose themselves, and must not let the media lose objective and rational communication because of money,” Mr. Ma said in the event, organized by Xinhua.

Media Empire

Media assets held by Alibaba include:

  • 100% of the South China Morning Post, Hong Kong’s premier English newspaper.
  • Nearly 37% of Yicai Media Group, one of China’s most influential news outlets.
  • About 30% of Weibo, a Twitter-like social media platform. Its stake is valued at more than $3.5 billion.
  • 6.7% of Bilibili, a video platform popular among younger Chinese people. Its stake is worth nearly $2.6 billion.
  • 5% of Mango Excellent Media, a subsidiary of government-run Hunan TV. Its stake is worth about $819 million.
  • Nearly 5.3% of Focus Media, China’s largest offline advertising network. Its stake is worth nearly $1.2 billion.

Media assets held by Ant include:

  • 16.2% of 36Kr, a U.S.-listed digital media outlet focused on technology. Its stake is worth $25 million.
  • Former 5.62% stake in Caixin Media, one of China’s most respected news sources. Ant sold its interest in 2019.

Sources: The Securities and Exchange Commission, Shenzhen Stock Exchange, National Equities Exchange and Quotations of China, National Enterprise Credit Information Publicity System of China, FactSet, Wind.

Note: Market values for U.S.-listed companies are as of March 12; for China-listed firms, as of March 15.

Write to Jing Yang at Jing.Yang@wsj.com

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Read original article here

Business

Philanthropist MacKenzie Scott, Ex-Wife of Jeff Bezos, Marries Seattle School Teacher

Leave a comment

MacKenzie Scott, the philanthropist formerly married to

Jeff Bezos,

has married again following her 2019 divorce from the

Amazon.com Inc.

founder, according to a person familiar with the matter.

Ms. Scott, one of the world’s wealthiest women, has married Dan Jewett, a science teacher at a Seattle private school, according to the person.

Ms. Scott has devoted much of her time recently to philanthropic efforts benefiting women-led charities, food banks and Black colleges, among other institutions. Since her divorce, Ms. Scott has given away more than $4 billion of her fortune, according to a post she wrote on Medium in December.

In a post dated Saturday on Ms. Scott’s page on the Giving Pledge website, for billionaires who have promised to donate most of their fortune to philanthropic efforts, Mr. Jewett signed on to her commitment.

“It is strange to be writing a letter indicating I plan to give away the majority of my wealth during my lifetime, as I have never sought to gather the kind of wealth required to feel like saying such a thing would have particular meaning,” Mr. Jewett’s post says.

“Dan is such a great guy, and I am happy and excited for the both of them,” said Mr. Bezos in a statement provided by an Amazon spokesman.

Ms. Scott and Mr. Jewett couldn’t immediately be reached for comment on Sunday.

Ms. Scott and Mr. Bezos, both Princeton University graduates, met while working at a hedge fund in New York. She helped him start Amazon in 1994, and is the author of two novels. Her Amazon author page now says that she “lives in Seattle with her four children and her husband, Dan.”

At the time of their 2019 divorce, after 25 years of marriage, Mr. Bezos was the wealthiest person in the world, with his stake of more than 16% of Amazon. Ms. Scott received 4% of Amazon’s shares as part of their divorce settlement, though Mr. Bezos kept voting rights for those shares.

Ms. Scott joined the Giving Pledge in May 2019, shortly after terms of her divorce with Mr. Bezos were finalized. The pledge was started by Bill and

Melinda Gates

and

Warren Buffett

in 2010. Mr. Bezos hasn’t joined the pledge.

Amazon’s business has been a major beneficiary of the pandemic, driving up its stock price. Mr. Bezos, after jostling for a time with

Elon Musk

for the title, again ranks as the world’s richest person, with a net worth of around $177 billion, according to wealth rankings by Forbes and Bloomberg. Ms. Scott ranks the 22nd richest person, at around $53 billion.

Mr. Jewett is a teacher at Lakeside School, according to the school’s website.

“In a stroke of happy coincidence, I am married to one of the most generous and kind people I know—and joining her in a commitment to pass on an enormous financial wealth to serve others,” Mr. Jewett said in his Giving Pledge letter.

Write to Dana Mattioli at dana.mattioli@wsj.com

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Read original article here