Twitter Is Going To Lay Off 336 Employees, Plus Facebook And YouTube Are In A Turf War Over Video

Gold Makes Gains on Grim Day

• U.S. stocks performed poorly yesterday with investors nervous over expectations that third quarter earnings for S&P 500 companies may live down to expectations calling for a 5 percent drop in profits. The other killer came from new data revealing that Chinese imports plummeted a whopping 20 percent last month from weak domestic demand.
• Nobody emerged unscathed: European markets fell across the board as well. The biggest losers were automotive companies, as well as commodity-based stocks such as Glencore.
• Speaking of commodities, oil couldn’t rebound from its big loss on Monday, finishing in the negative after the International Energy Agency reported there would most likely be an oversupply of oil next year.
• The diamond in the rough was gold, which was one of the few gainers yesterday. Generally, when gold rises, it’s a sign that investors are expecting a no-go on an interest rate hike this year.

Earnings Season in Full Swing

Let’s take a quick look at some of the companies that reported earnings yesterday:

• JPMorgan: The first bank to report earnings fell short of revenue expectations and warned that fourth quarter estimates will be low as well. Yet their earnings beat estimates, in part due to tax benefits and other write-offs.
• Johnson & Johnson: Similar to JPMorgan, the health care giant beat earnings, but missed revenue projections. This was in part attributable to a strong dollar.
• Intel: The chipmaker bucked the trend, managing to beat estimates on both earnings and revenue. Their outlook for the upcoming quarter remained upbeat.

Fifth Time’s the Charm

Five offers later, it looks like Anheuser-Busch InBev has finally gotten it right. AB InBev (makers of Budweiser) and British brewer SABMiller (makers of Miller Lite) have settled on a massive takeover deal estimated at around $104 billion. The last few years have been sobering for breweries—beer consumption has flattened off in developed markets, and InBev (the world’s #1 brewer) has little presence in the one area where growth opportunities remain: emerging markets. It just so happens that a third of SABMiller’s profits come from Africa (see where we’re going with this?). Once approved by SABMiller’s shareholders, the deal will create the world’s largest brewing company, controlling nearly a third of the global market. But don’t crack open a cold one in celebration just yet—even if the deal goes through smoothly, AB InBev might still have to answer to antitrust concerns. After all, controlling 30 percent of the global beer market comes with a price.

Twitter Cleans Nest

New Twitter CEO Jack Dorsey is trimming the company he helped found: we’re talking an 8 percent reduction in headcount (that’s 336 employees worldwide). After expanding its workforce by 24 percent last year, Twitter has encountered inefficiencies due to overlapping job roles and indecisiveness. The terminations are intended to clean up the mess as the company restructures to focus more on user growth, which decelerated to 2.6 percent over the summer. Dorsey believes that a nimbler workforce will facilitate speedier content development and decision making. Hopefully, the bold move gets Twitter trending once again.

Facebook-YouTube Turf War

We’ve all done it—scrolled down our newsfeeds and become hypnotized by the plethora of auto-play videos. With over 4 billion video views per day and $200 billion in TV ad spending per year, Facebook is sitting on a potential gold mine. One that it’s now starting to test, in the form of a dedicated video feed, which would also suggest videos and show you what your friends are watching. This means the rivalry between Facebook and Alphabet’s YouTube is heating up as Facebook vies for a bigger piece of the video advertising revenue pie.