Netflix Crushes Estimates; Uber’s Value Doubles; Audi’s Massive Fine

The Water Coolest

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THE HEADLINES

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BEAT YOUR STREET

Netflix Smart Downloads Deleting User Reviews

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Netflix stepped up to the plate … and hit a grand slam on earning’s estimates for the quarter, sending NFLX up more than 11% in after-hours trading.

The ‘flix added 6.96M users globally in Q3, bringing its global total to 137.1M. The streaming service announced that it plans to add a total of 28.9M new users for the year … a new record for the twenty-one-year-old company.

For what it’s worth, in 2019 new user totals will no longer include free trial memberships which “adds noise to our membership forecasts in a way that isn’t material.”

A record 676 hours of original programming were released in the third quarter, which is the first time Netflix has gone over 500 hours for a fiscal Q. Now, back to Ozark.

Water Cooler Talking Point: “It doesn’t count if 7 people are sharing the same account, guys.”

 

FUND HAILING

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The masters of the universe at some of Wall Street’s top tier investment banks seem to have forgotten that they don’t need to stroke Travis Kalanick’s ego anymore. Still, bankers are pitching Uber on a $120B valuation for its potential 2019 IPO.

The issue? Uber was valued at just $70B during its latest funding round. Oh, and did we mention that an IPO of the unprofitable ride-sharing service would be the largest of all time? Take that Aramco. 

Goldman and Morgan, recently named as underwriters on the IPO will pad the league tables all while praying to the ghost of Gordon Gekko that Uber Eats and Lime can put Uber in the black.

Meanwhile, Uber’s ugly stepsister Lyft is busy planning its own 2019 IPO. JPMorgan will lead the offering, with Jeffries and Credit Suisse taking a backseat on an IPO estimated to value the company at $15.1B.

Water Cooler Talking Point: “Has CNBC started talking about the ride-hailing bubble yet?”

 

FINE BY ME

 

German automaker Audi has been slapped with a $930M fine by German prosecutors as a result of the Volkswagen emission scandal uncovered in 2015, and again in 2017, impacting millions of cars produced worldwide from 2009 to 2013.

VW was found out to be rigging emissions testing on its cars so that it would pass factory testing, but later emit up to 40x more Nitrogen Oxides (NOx) IRL (read: in real life).

The US was the first to discover the wrong-doing and charged VW $2.8B in fines, citing over 590k cars sold in the US with piss-poor emissions, and over 8.5M recalls worldwide. Despite the magnitude of these fines, Audi and VW are hoping this is the last time diesel-gate will be brought up.

Water Cooler Talking Point: “They couldn’t make it an even billion so our headline would pop?”

 


IN OTHER NEWS

 

  •  a16z plans to invest $300M in Devoted Health, a Massachusetts based insurance startup with a focus on Medicare beneficiaries. Apparently, shipping our geriatrics to the Jimmy Buffett retirement home is frowned upon …

 

  • In response to an EU antitrust suit, Google will begin charging a licensing fee for its bundle of apps (think: Gmail, Youtube etc.) to be pre-installed on Android phones. Google had previously pre-loaded the apps for free. Wait … what?

 

  • “Today was a good day” – David Solomon doing his best Ice Cube impression. Goldman Sachs’ new leading man got a warm welcome on his first earnings report (of course, Lloyd actually oversaw this quarter). The bank’s investment banking division posted a 10% revenue gain in Q3 vs. an expected loss.

 

  • Stone Co. (not the ice cream parlor, we checked) the Brazillian fintech plans to raise $1B on at a $6B valuation via a US-based IPO. Shares will price between $21 and $23.

 

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