Consumer tech and its importance

Fitness company Peloton is the latest startup to pedal towards the public markets as it publicly filed its registration statement on Tuesday. The New York-based company posted $915 million in revenue for its 2019 fiscal year (July 2018 to June 2019), but also rising losses as it spent more on advertising to acquire users. It lost $195.6 million, up from $47.9 million from the previous year.

Started in 2012, Peloton became a cult fitness hit due to its combination of live-streamed classes and an on-demand library of workouts. The company started out originally with a connected bike, but has since expanded into a treadmill and now offers classes like stretching and yoga to its subscribers. The company counts more than 511,000 subscribers who do on average 11.5 workouts per month, up from 8.4 the year prior.

Most of Peloton’s revenue comes from a combination of sales of its connected bike and treadmill products, along with its $39 a month fitness subscription. Its high price-tag ($2,245 for a bike or $4,295 for a treadmill) helped make up the bulk of Peloton’s revenue: $719 million from sales of physical devices for its fiscal year 2019.

What is science?

With global trade tensions showing no signs of abating, Singapore’s economy has flatlined. A recent government forecast projects virtually no growth for the island-nation in 2019, citing potential risks such as a deepening slowdown in China, uncertainties in Hong Kong and further afield, the fallout from a no-deal Brexit. Despite these looming headwinds and a stock market that declined 3.5% since July 2018, the collective wealth of the top 50 richest was up more than 12% to $130 billion.

Billionaire Backs U.K. Startup Trying To Extend Human Life Spans

 

Atlassian’s Mike Cannon-Brookes invested in the startup via his investment company, Grok Ventures.

Mike Cannon-Brookes, the billionaire cofounder of Australian software giant Atlassian, has invested $10 million in Juvenescence, a U.K. firm that’s trying to increase human longevity.

The average human life span is around 72 years, and billionaires are investing heavily in a handful of life science startups that hope to help people live longer.

Cannon-Brookes, who owns the most expensive house in Australia, participated in a $100 million series B funding round that was announced on Monday. The Sydney resident made the investment through his investment company, Grok Ventures.

Michael Spencer, former CEO of brokerage ICAP and one of the wealthiest men in Britain, also invested $10 million through his personal investment firm IPGL.

The founders also put in $10 million, and total investment in Juvenescence stands at around $165 million.

 

Juvenescence isn’t working on a single moon-shot project but aims to build a “longevity ecosystem,” or a portfolio of interlinked companies working on therapies and treatments that could enable people to live longer, healthier lives.

“We actively look for scientific founders probing exciting areas of aging biology, and work with leading research institutions to create joint ventures combining their IP and our resources,” the company writes on its website.

Juvenescence employs around 20 scientists, drug developers, AI specialists, and financial experts to coordinate the efforts of its portfolio, which is working on novel treatments for cancer, diabetes, neurodegenerative disorders and heart disease.

So far, Juvenescence has invested in 15 companies, including California-based AgeX Therapeutics and Fox Bio, which are both working on therapies that can improve old human tissue.

Cannon-Brookes is the latest tech billionaire to invest in longevity-focused startups. Oracle founder Larry Ellison has donated millions to research via his medical foundation, Jeff Bezos has reportedly invested in Unity Biotechnology, while Alphabet owns Calico, which has a staff of around 150 working to understand the biology that controls lifespans.

“We have recruited a group of sophisticated shareholders from around the world to further our common mission of improving human healthy lifespan,” Jim Mellon, chair of Juvenescence, said in a statement.

“Juvenescence has now raised more money than any comparable company, which is testament to the depth of our team and the range of opportunities that we have assembled, in partnership with scientist/entrepreneurs and research institutions. As the science of longevity becomes mainstream, we expect significant investor interest, and at some point, we anticipate taking Juvenescence public to further accelerate our development.”

Juvenescence raised the money at a valuation of $500 million, and it’s planning to IPO in New York next year, according to the Financial Times.

 

PS4, Xbox One And Nintendo Switch Are Safe From Trump’s Tariffs…For Now

Sony, Nintendo and Microsoft likely breathed a sigh of collective relief this morning alongside the broader market. The Trump Administration today announced new exemptions from a list of Chinese-manufactured items scheduled to receive a 10% import tax, delaying tariffs on those items until December 15. That list includes a number of gaming-related categories, including video game consoles like the PlayStation 4, Xbox One and Nintendo Switch.

“Certain products are being removed from the tariff list based on health, safety, national security and other factors and will not face additional tariffs of 10 percent.”

“Further, as part of USTR’s public comment and hearing process, it was determined that the tariff should be delayed to December 15 for certain articles.  Products in this group include, for example, cell phones, laptop computers, video game consoles, certain toys, computer monitors, and certain items of footwear and clothing.”

While I’m not entirely sure what the national security, health or safety rationale is when it comes to video game consoles, a quick look at this list shows a range of items that are vital for the US consumer economy, predominantly manufactured in China and for which it would be monumentally difficult to move production. Sony, Microsoft, and Nintendo sent a letter to the Trump administration in June warning them about the potential impacts of tariffs on the US video game industry:

Economically, the video game industry contributes substantially to the U.S. economy, and its year-on-year growth is impressive. The U.S. video game industry generated total revenue of $36 billion in 20172 and $43.4 billion in 2018,3 reflecting over 20% in growth. This industry directly and indirectly employs more than 220,000 people. Ninety-nine point seven percent (99.7%) of video game companies qualify as small businesses and can be found in each of the fifty states; many develop software for video games across the range of platforms, from PCs to mobile, including the video game consoles that we manufacture, and are an integral part of the booming app economy.

What is Cybersecurity?

Aramco’s net income for H1 2019 was $46.9 billion. This is actually a 12% decrease from its net income for the first half of 2018, but was expected because the price of the Brent oil benchmark has averaged $66 per barrel this year as opposed to $69 per barrel last year. The company continues to diversify by growing its downstream sector as well as become more integrated.

Yet, the big questions concerning the strength of the company as a possible investment for outsiders remains unaddressed. Specifically, potential investors need to understand Aramco’s relationship with the Saudi government. This was only addressed at one point during the call when an analyst asked about Aramco’s dividend. According to figures provided by Aramco, the company paid $26.4 billion to its shareholder in “Ordinary Dividends” in H1 2019. This was almost identical to the amount paid in H1 2018. However, Aramco paid another $20 billion to Saudi Arabia in “Special Dividends.” This reflects an increase of $14 billion over last year’s H1 dividend.

In answering the question, Aramco’s CFO, Khalid al-Dabbagh, explained that Aramco’s executives and board of directors policy regarding the Ordinary Dividend is based on three criteria: sustainability, affordability and a benchmark. According to al-Dabbagh, such a high dividend in 2019 was possible despite lower profits because Aramco made more than anticipated in 2018. However, he did not address the fact that this incomparably high dividend is given because it is needed to satisfy a significant part of Saudi Arabia’s budget. Saudi Arabia, as a country, could not survive without this dividend and its royal family could not prosper.

Even more important are the implications of this dividend should Aramco go public. For example, will this type of dividend be available to the holders of publicly traded shares or will the Saudi government be the only recipient of “Special Dividends” or even the “Ordinary Dividends” from Aramco? If Aramco makes its lucrative dividend available to shareholders other than the Saudi government, then Aramco shares could prove highly valuable. On the other hand, if Aramco continues to fund the Saudi government through a dividend that is unavailable to other shareholders, then the public could very well find Aramco shares a highly unattractive prospect.

What is Consumer Tech?

Aramco’s net income for H1 2019 was $46.9 billion. This is actually a 12% decrease from its net income for the first half of 2018, but was expected because the price of the Brent oil benchmark has averaged $66 per barrel this year as opposed to $69 per barrel last year. The company continues to diversify by growing its downstream sector as well as become more integrated.

Yet, the big questions concerning the strength of the company as a possible investment for outsiders remains unaddressed. Specifically, potential investors need to understand Aramco’s relationship with the Saudi government. This was only addressed at one point during the call when an analyst asked about Aramco’s dividend. According to figures provided by Aramco, the company paid $26.4 billion to its shareholder in “Ordinary Dividends” in H1 2019. This was almost identical to the amount paid in H1 2018. However, Aramco paid another $20 billion to Saudi Arabia in “Special Dividends.” This reflects an increase of $14 billion over last year’s H1 dividend.

In answering the question, Aramco’s CFO, Khalid al-Dabbagh, explained that Aramco’s executives and board of directors policy regarding the Ordinary Dividend is based on three criteria: sustainability, affordability and a benchmark. According to al-Dabbagh, such a high dividend in 2019 was possible despite lower profits because Aramco made more than anticipated in 2018. However, he did not address the fact that this incomparably high dividend is given because it is needed to satisfy a significant part of Saudi Arabia’s budget. Saudi Arabia, as a country, could not survive without this dividend and its royal family could not prosper.

Even more important are the implications of this dividend should Aramco go public. For example, will this type of dividend be available to the holders of publicly traded shares or will the Saudi government be the only recipient of “Special Dividends” or even the “Ordinary Dividends” from Aramco? If Aramco makes its lucrative dividend available to shareholders other than the Saudi government, then Aramco shares could prove highly valuable. On the other hand, if Aramco continues to fund the Saudi government through a dividend that is unavailable to other shareholders, then the public could very well find Aramco shares a highly unattractive prospect.

What is Al & Big data conference?

Aramco’s net income for H1 2019 was $46.9 billion. This is actually a 12% decrease from its net income for the first half of 2018, but was expected because the price of the Brent oil benchmark has averaged $66 per barrel this year as opposed to $69 per barrel last year. The company continues to diversify by growing its downstream sector as well as become more integrated.

Yet, the big questions concerning the strength of the company as a possible investment for outsiders remains unaddressed. Specifically, potential investors need to understand Aramco’s relationship with the Saudi government. This was only addressed at one point during the call when an analyst asked about Aramco’s dividend. According to figures provided by Aramco, the company paid $26.4 billion to its shareholder in “Ordinary Dividends” in H1 2019. This was almost identical to the amount paid in H1 2018. However, Aramco paid another $20 billion to Saudi Arabia in “Special Dividends.” This reflects an increase of $14 billion over last year’s H1 dividend.

In answering the question, Aramco’s CFO, Khalid al-Dabbagh, explained that Aramco’s executives and board of directors policy regarding the Ordinary Dividend is based on three criteria: sustainability, affordability and a benchmark. According to al-Dabbagh, such a high dividend in 2019 was possible despite lower profits because Aramco made more than anticipated in 2018. However, he did not address the fact that this incomparably high dividend is given because it is needed to satisfy a significant part of Saudi Arabia’s budget. Saudi Arabia, as a country, could not survive without this dividend and its royal family could not prosper.

Even more important are the implications of this dividend should Aramco go public. For example, will this type of dividend be available to the holders of publicly traded shares or will the Saudi government be the only recipient of “Special Dividends” or even the “Ordinary Dividends” from Aramco? If Aramco makes its lucrative dividend available to shareholders other than the Saudi government, then Aramco shares could prove highly valuable. On the other hand, if Aramco continues to fund the Saudi government through a dividend that is unavailable to other shareholders, then the public could very well find Aramco shares a highly unattractive prospect.