", Medium.com. Got a confidential news tip? Brad, thank you. He said the money the company is currently spending to develop VR could add up for a decade before it comes to fruition. By any normal company or start up standard, $5 B per year would seem like an extraordinary amount. Login effective risk management for all users of derivative products. The Digital Markets Act (DMA) is a groundbreaking European law designed to rein in the power of the gatekeepers of the digital economy. Where's your exposure today? From Grand Teton to Universal Speech Translator to Make-A-Video, we are witnessing a Cambrian moment in AI, and Meta is no doubt well positioned to help invent and monetize that future. Conforti plans to join a new firm as a co-founder with. In fact, we believe that augmented and artificial intelligence has the potential to drive more economic productivity than the internet itself. ISDA fosters safe and efficient derivatives markets to facilitate committed hundreds of millions of dollars to Sequoia Capital, Altimeter Capital Management and Multicoin . Altimeter manages a long / short public equity fund and private growth equity funds. Last fall, Brad Gerstner from Altimeter Capital published an open letter, telling Meta it has "lost the confidence of investors" and telling the company to throw in the towel on its metaverse project. Meta Platforms CEO Mark Zuckerberg speaks about the Facebook News feature at the Paley Center For Media in New York on Oct. 25, 2019. Can you tell me where that stands now and how you view stocks like that that have gotten absolutely obliterated? We've destroyed over $15 trillion of stock market wealth. Founder & Chief Executive Officer at Altimeter Capital . So, it doesn't surprise me at all that buyers are on the sidelines and that sellers and short sellers are having a field day with stocks. Focusing the Metaverse: the Next Generation of Communication and Collaboration. To put that in perspective, excluding your large metaverse investment, Meta is investing more in capex than Apple, Tesla, Twitter, Snap, and Uber combined! What am I supposed to think about that? Despite public skepticism at times warranted we have been supporters And we've had government intervention of the magnitude. [2] The firm focuses on technology investments in both public and private markets globally. Instead, the company has announced investments of $1015B per year into a metaverse project that largely includes AR / VR / immersive 3D / Horizon World and that it may take 10 years to yield results. Metas core business is one of the largest and most profitable in the world with over $45 B in operating profits last year alone. Altimeter Growth Corp. raised $450 million in an October 2020 IPO. These are not numbers on a spreadsheet. We worked hard on the deal and the timing was horrific. 3,30,700 crore) if it cut headcount by at least 20 percent, trimmed capital expenditure by at least $5 billion (roughly Rs. Nov. 16, 2021 at 2:38 p.m. Meta stock is down over 61% in 2022. Ultimately, Gerstner said, Meta has too many people and is spending too much on capital expenditures. They're fearful about what's going to happen with rates. This is a business it's grown, it's trading at 28 times free cash flow with 20% growth, that will continue to compound. That could in fact become a tailwind as we get to the back half of the year. Altimeter Capital Management, LLC. Board of Directors
To accomplish this goal, we recommend a three step plan that will double FCF to $40 B per year and focus the companys teams and investments: Getting Fit Headcount Reduction / Expense Control. I have deep respect and admiration for founders that continue to grind, inspire, and invent long after the financial motivation is gone. The company explained that its goal has always been to "create hardware that's affordable for as many people as possible to take advantage of all that VR has to offer." Meta Platforms (META) shares jumped 6% after the tech giantannouncedbig price cuts for its virtual reality (VR) headsets. Cookies collect information about your preferences and your devices and are used to make the site work as you expect it to, to understand how you interact with the site, and to show advertisements that are targeted to your interests. Digital Markets Act (DMA): How the EU Law Will Work, Mark Zuckerberg: Founder and CEO of Meta (formerly Facebook), Crowdfunding: What It Is, How It Works, Popular Websites, FTX: An Overview of the Exchange and Its Collapse, New Prices for Meta Quest 2s 256GB SKU + Meta Quest Pro, Time to Get Fit an Open Letter from Altimeter to Mark Zuckerberg (and the Meta Board of Directors), Meta Reports Fourth Quarter and Full Year 2022 Results. The conventional wisdom press and investor is that the core business hit a wall last fall. Altimeter Growth Corp., the blank-check company merging with internet giant Grab Holdings Inc., is hovering just a few cents above its record low after cratering 28% since the deal was unveiled in . GERSTNER: Well, first let's talk about what took Facebook down, right? PLAN, Yearly WAPNER: I wanna, I want to take a break and get into some of those names of all four but before I do that lastly, you mentioned very interestingly that you've taken your bond short off. And I've let the company know that, right? On Oct. 11, Meta announced a new high-end VR headset, the Quest Pro. But what is the right amount? Its founder faces criminal and civil charges and goes to trial in October. Altimeter Growth Corp. 2 raised $400 million in a January IPO. Our best guess is that maintenance capex for Meta is less than $10B annually. Altimeter said annual free cash flow can be doubled to $40 billion if it cut headcount by at least 20%, trimmed capital expenditure by at least $5 billion to $25 billion a year and capped. When you look at these questions, it comes down to this. Got a confidential news tip? We know they have high EBITDA margins on the rideshare business which is dominant across the region. Why 20%? Despite public skepticism at times warranted we have been supporters of the companys strategy to continuously reinvest in a product-led future and its mission to make the world more open and connected. 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Altimeter Capital owns about 2.46 million Meta shares. And frankly, they weren't a very good hedge because bonds haven't moved all that much but gross stocks are down 60, 70, as you mentioned, down over 80%. If Meta was able to control those costs, he said, then it could double its free cash flow and improve its share price. GERSTNER: Right, it comes down fundamentally to a question Scott of whether you think we're gonna have more than eight rate increases or less. It's a better version of Zoom. Updated on September 30, 2022. United has an Underqualified, Ineffective, and Entrenched Board: While presiding over United's stunning long-term underperformance, we believe that the incumbent Board (and a majority of the newly-expanded 15-person Board): (1) lacks sufficient leadership, expertise, and experience to challenge management and hold management accountable, to direct an operational and financial turn-around, and to maximize stockholder value; (2) has entrenched itself by implementing various mechanisms to financially penalize stockholders for making meaningful Board changes; (3) has failed to adequately align management compensation with stockholder interests; and (4) is too stale to effectively represent stockholders. Crowdfunding is the use of small amounts of capital from a large number of people to raise money or fund a business. This compensation may impact how and where listings appear. There is no doubt that doubling annual FCF will improve share price. August 2012 Protocol ALID: 66703 As I look at it, the market is now pricing in at least seven rate hikes. That's the asymmetry. Based on yesterday's announcement, it seems the Board now agrees that for many years it operated with a suboptimal composition. Is it close to being done? Investopedia requires writers to use primary sources to support their work. March 8, 2016
The company has lost investor confidence as it ramped up spending and pivoted to the metaverse, the technology-focused hedge fund with a 0.1% stake said, and suggested a three-step plan. Brad Gerstner's Phone Number and Email Last Update. Conclusion A Leaner, Faster, More Successful Meta. Over the last three years, Meta has also dramatically increased its capital expenses. Let me tell you the bear case on Facebook, okay, the bear case on Facebook and other ad models like Google is that we're running headlong into a massive recession. It's a better version of Messenger. It is a poorly kept secret in Silicon Valley that companies ranging from Google to Meta to Twitter to Uber could achieve similar levels of revenue with far fewer people. Portfolio Gain +273.45%. The metaverse is a shared virtual environment with aspects of online gaming, augmented reality, and more that people can access via the Internet. If the company were investing $12B per year into this project, then that confusion might not even be a problem. Industry Trends on 4000+ Stocks, Pro Investing by Aditya Birla Sun Life Mutual Fund, Canara Robeco Equity Hybrid Fund Direct-Growth, Cut workforce, spending on metaverse, key investor tells Mark Zuckerberg. It's my job to ask you about it knowing you're not happy about it and you answered the question. According to Hedge Follow, it was authored by Brad Gerstner, CEO and founder of technology investment firm Altimeter Capital. Meta. Altimeter. Chicago, IL 60606
With SNOW currently trading at $242, that stake is now worth $8.8 billion. But far from being a bad decision, we think the recommendations outlined above will lead to a leaner, more productive, and more focused company a company that regains its confidence and momentum. Bill Ackman's: Pershing Square Capital Management. We have little doubt investors and others would happily support scaling up these investments as the ROI becomes more tangible even if still long-term. On top of that we had supply chain challenges. The letter is the latest sign that Meta investors are starting to express reservations about the company's recent performance. All rights reserved. Link to 13F filings: SEC filings HONG KONG (AP) Southeast Asia's largest ride-hailing company, Grab Holdings, said Tuesday that it plans to merge with U.S.-based Altimeter Growth Capital in a deal that would value it at . We don't think we're going to have 10 rate hikes and we do think there'll be an off ramp to the situation in Ukraine. As you know, we are long-term shareholders. Altimeter Capital Management is an investment firm that operates within the technology sector. Their last reported 13F filing for Q4 2022 included $3,652,571,000 in managed 13F securities and a top 10 holdings concentration of 99.95%. Right. GERSTNER: So, Scott that you know the top six names in our book are all companies that we believe are, you know, both accelerating, expanding margins, expanding free cash flow margins, right, and that are critically important and will be worth more in the future. At the same time that Meta ramped up spend, you lost the confidence of investors. will trigger a new window or tab to open. This will alert our moderators to take action. That was our baseline that we were going to have a relatively soft landing, three to four rate hikes. Right? They are people with families and kids to support. Rates are going up and we have a war. We want to hear from you. Moreover, I am a strong supporter of founder-led companies especially when they have your successful track record of seeing the future. Of course, a company that connects nearly three billion users on phone and text must be investing in the next generation of communication. To put that in perspective, excluding your large metaverse investment, Meta is investing more in capex than Apple, Tesla, Twitter, Snap, and Uber combined! As such, we think during this period of growth transition and economic uncertainty, the company should decrease capex by at least $5B and maintain this discipline until revenues re-accelerate bringing our capex as a percentage of revenue more in line with our large cap peers. "We think the recommendations outlined above will lead to a leaner, more productive, and more focused company a company that regains its confidence and momentum," Gerstner wrote. We are confident that these employees will find replacement jobs and quickly be back to work on important inventions that will move us all forward. As always, we welcome the opportunity to engage in further discussions focused on this shared objective. Our contact information, solely for purposes of this Adherence Letter (and unrelated to the Questionnaire delivery options in the subsequent section) is: We consent to the publication of a conformed copy of this letter by ISDA and to the disclosure by ISDA of the contents of this letter. Meta changed its company name from Facebook. In short, Meta needs to get fit and focused. A Division of NBCUniversal. Tina Sharkey, CEO of SherpaFoundry; former board member of HomeAway; and
The last 10 years have been a unique time in tech and for Meta. We can just go through the list, Uber, Facebook, Roblox. I think you're gonna see monetization gains against IDFA and either way we lap that issue in Q3 and Q4. To set a new and better course for the Company, and to give United stockholders the opportunity to elect the Board they deserve, Altimeter has delivered to you a notice today indicating its intention to nominate six highly qualified professionals led by former Continental Airlines CEO Gordon Bethune to the United Board at the 2016 annual stockholder meeting. Finally, Prudential PLC lifted its . Even excluding its large metaverse investment, Meta has gone from $15B in annual capex in 2018, 2019, and 2020 to $30B in annual capex in 2022. The stock today hit a new low under $3. 2550 Sand Hill Road, Suite 150. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. Why didn't you buy, you know, Uber at 28 bucks a share? Open letter: Altimeter Capital founder and CEO Brad Gerstner encourages Meta to cut capex by $5B+, cut headcount by 20%+, and limit metaverse R&D to $5B/year As you know, we are long-term shareholders. FalconX Raises $210M Following 30x YoY Revenue Growth; Now Valued at $3.75 Billion Series C Led by Altimeter Capital, B Capital Group, Sapphire Ventures, and Tiger Global Management, with. They just announced that they're going to be profit, full company profitable by 2023. I'm going to own these companies, there are a handful of select companies that are free cashflow positive that are going to be worth more in the future. And frankly, I don't think we're gonna have hyperinflation in a world where demand is being destroyed at the rate it's currently being destroyed. This is a leading internet company in Southeast Asia. We were about 30% to 40% depending upon which basket you looked at software internet above the five-year average. After the pandemic, hospitals are now on a strong footing. Altimeter Capital. Altimeter Capital Management LP now owns 2,850,000 shares of the Internet company based in Singapore's stock worth $131,784,000 after purchasing an additional 1,600,000 shares during the last quarter. Meta didn't immediately respond to a request for comment. About Kevin Wang. browser. If you really think about what the metaverse is in the first instance, it's a better version of what you and I are doing right here. As you know, we are long-term shareholders. Choose your reason below and click on the Report button. The reductions for the Quest Pro start March 5 in the U.S. and Canada, and on March 15 in other countries where it is supported. Altimeter Capital Chair and CEO Brad Gerstner said in an open letter to the company and CEO Mark Zuckerberg on Monday that Meta has too many employees and is moving too slowly to retain the confidence of investors. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. About Altimeter Capital Getting Fit Headcount Reduction / Expense Control. Following is a link to video on CNBC.com: https://www.cnbc.com/video/2022/03/14/we-could-go-lower-before-we-go-higher-in-stocks-says-altimeter-capitalas-ceo-brad-gerstner.html. You got a lot of this right but multiples have come down a heck of a lot to this point. "Meta needs to re-build confidence with investors, employees and the tech community in order to attract, inspire, and retain the best people in the world," Gerstner wrote in the letter. WAPNER: Let me lastly ask you about Grab, the SPAC deal you did, biggest SPAC deal ever of $40 billion. They're building their own ad platform, right, that can deal with this. At the start of COVID on March 26th when I felt about like I do today, growth stocks were under assault. It takes effect in 2023. Altimeter Capital Management, ISDA 2021 SBS Top-Up Protocol - Adherence. Rapid mobile adoption helped market leaders blaze through the s-curve with astounding growth rates and a historically low cost of capital made investments in people and things the rational economic decision. Altimeter Capital Chair and CEO Brad Gerstner, in an open letter to the company, said Meta has too many employees and is moving too slowly to retain the confidence of investors. FTX, once the third-largest centralized cryptocurrency exchange, is now in U.S. bankruptcy. Perhaps it was the re-naming of the company to Meta that caused the world to conclude that you were spending 100% of your time on Reality Labs instead of AI or the core business. This lack of focus and fitness is obscured when growth is easy but deadly when growth slows and technology changes. And, while that ultimately is an important long-term measure of success for all of Metas stakeholders, it would be imprudent to make short-term bad decisions just to improve the share price. Meta can get its mojo back, says Brad Gerstner, but it will have to take some hard decisions first. Meta has spent billions and hired thousands of employees around the world to build the metaverse, which refers to a shared digital environment that uses augmented or virtual reality technology to make it feel more realistic. There isnt a day that goes by where I dont find myself using Metas products to communicate, to connect, and to entertain still amazed at the power of these services. 2023 Benzinga.com. Over time, we intend to share with United's stockholders our detailed analysis, which has led us to conclude, among other things, that:
How big are the margins, ultimately Snowflake will be worth a lot more because there is almost endless demand for the product and this is a business that is highly profitable. Credit Derivatives Determinations Committees, how to enable They may never get back to the levels at which they traded before. Search ISDA ISDA fosters safe and efficient derivatives markets to facilitate effective risk . Some companies require tremendous capex investment to maintain their existing business. The same is true for Microsoft, right? CAPEX Investing Aggressively and Responsibly in the Future of AI. GERSTNER: Well, the first thing I would say is this, set aside SPAC. Our six nominees have the necessary skills, leadership abilities, and relevant experience to catalyze a United course change and to help the Company realize its immense potential. It makes no sense to me, but that is the risk that you run. With all of that said, we believe the company can responsibly and reasonably reign in capex while continuing to invest aggressively in AI and other critical areas. Moreover, Meta has industry leading capabilities in key future technologies like artificial intelligence and immersive 3d that will help drive new products and future growth. b***@altimeter.com. Meta shares moved 6% higher following the announcement. Altimeter Capital Management partner Chris Conforti plans to leave the investment firm, according to people with knowledge of the matter. Protocol: At Meta, the number of employees is up over 3x from 25k to 85k employees in just the last four years! Amazon Is Closing Its Cashierless Stores in NYC, San Francisco and Seattle, Amazon Pauses Construction on Second Headquarters in Virginia as It Cuts Jobs, Stock Traders Are Ignoring Blaring Bond Alarms, iPhone Maker Plans $700 Million India Plant in Shift From China, Russia Is Getting Around Sanctions to Secure Supply of Key Chips for War. But Meta needs to get its mojo back. Can it possibly be worth 200 billion? As you know, Altimeter Capital Management and PAR Capital Management are long-term United Continental Holdings, Inc. ("United") stockholders that together own approximately 7.1% of United's outstanding common stock. I think if you said why might these numbers have to come down if we're heading into a recession, the numbers are likely to come down. Sincerely,
We were wrong. United Continental Holdings, Inc.
Comprender el funcionamiento social, poltico, econmico, cultural y natural de la sociedad a fin de reflexionar, hacer propuestas y asumir compromiso en torno a las polticas de desarrollo nacional, local y regional en el mbito del respeto de los derechos humanos, la integracin econmica y la convivencia social, bajo una concepcin de desarrollo humano sostenible. Meta. The vast majority of the capex has been an essential and high-returning investment in data centers, Nvidia GPUs and other AI resources to solidify the companys position as one of worlds leaders in AI. 16,839 Followers. The silver lining is that unlike many companies, this popular narrative obscures the truth. We simply wanted to further engage and continue sharing our thoughts as an interested shareholder. Dave Baszucki of Roblox describes the metaverse as the natural evolution of communication a multi-device world, including the phone, that is best thought of as a better version of text, video, and voice that will make us feel more connected.
Whether it is making Whatsapp more seamless or making content and ads more useful on Instagram, Reels and Facebook AI is a globally scarce resource that already is driving noticeable improvements for Metas three billion customers and advertisers. Altimeter's nominees are:
We want to hear from you. I have spent over 20 years investing behind some of the worlds great founders who are helping to invent the technologies that move the world forward. CAPEX Investing Aggressively and Responsibly in the Future of AI. If they do it, I think the stock can be up over 50% between now and the end of the year. Barney Harford, former CEO of Orbitz Worldwide; former board member of Orbitz Worldwide and eLong;
In the last 18 months, Meta stock is down 55% (compared to an average of 19% for its big-tech peers).
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