July 28, 2024: Pivotal Week For NASDAQ Coming Up

Last week, Dow Jones rose 0.6%, S&P 500 lost 0.8%, and Nasdaq composite fell 2.1% despite Friday’s rebound. Upcoming earnings from big techs including, Apple, and Microsoft this week and the Fed rate outlook will likely determine if the Nasdaq can turn around or heads into correction territory. Honeywell is considering an IPO of its majority-owned quantum computing firm Quantinuum as soon as next year at a US$10 billion valuation. Revolut, already the world’s second most-valuable fintech startup after Stripe, is in talks to sell the shares to new shareholders at a US$45 billion valuation. Wiz has ended deal talks with Google after the tech giant offered to acquire the startup for US$23 billion. Southeast Asia’s biggest ride-hailing and food delivery firm, Grab, has bought Singaporean dining reservation platform Chope for an undisclosed price. Anthropic projected to burn more than US$2.7 billion in cash this year. IBM shares rose 5% in extended trading on Wednesday, after Q2 results surpassed analysts’ predictions. Google’s ad revenue growth softened slightly in Q2, the company also reversed its decision to end ad trackers in Chrome. OpenAI is launching a search engine, taking direct aim at Google, sending Google shares down 3%. Tesla CEO Elon Musk said he will ask the company’s board of directors to consider investing US$5 billion in xAI. Reddit is partnering with several major sports leagues to bring more video content to the site in hopes of boosting advertising revenue. In Canada, Sophic Client, Kraken’s long thesis was highlighted by Deep Sail Capital in their Q2 investor letter. Sophic Client, Plurilock provided a corporate update, and was recognized by industry analysts for the fifth year. Sophic Client Xcyte Digital announced a strategic partnership with Pixel Canvas. Cohere raised US$500 million at US$5.5 billion valuation, and announced staff cuts. Clio topped a $4-billion valuation with the largest software funding round in Canadian tech history.

Sophic Client Kraken Robotics (PNG-TSXV, KRKNF-OTC): Deep Sail Capital published their Q2 2024 investor letter highlighting long thesis. Read here (page 3). https://bit.ly/4fkG7ic

Sophic Client Plurilock (PLUR-TSXV, PLCKF-OTCQB) provides Corporate Update for Shareholders.

Since the beginning of the year the Company has announced over $20 million in new sales orders. Plurilock maintains consistent order flow from both government and commercial clients across diverse industries and remains committed to supporting the critical infrastructure that underpins society. Plurilock has secured orders from major hospitals, a historic U.S. public institution, key airports, large pharmaceutical and Nasdaq 100 semiconductor companies, as well as the federal governments of Canada and the United States, among others. As Plurilock leverages these trusted relationships, the Company is now focused on delivering higher-margin solutions within its current footprint to both better serve our customers and maximize profitability. Recognizing the increased need for specialized security solutions and the investment required to counter evolving cyber threats, Plurilock strategically shifted resources towards Critical Services by launching a dedicated Critical Services division in February 2024. Plurilock Critical Services is designed to provide immediate solutions to pressing cybersecurity challenges as well as aiding organizational efficiency. Plurilock’s strategic plan involves building on established client relationships to convert one-time engagements into recurring managed services. Plurilock achieved $70.4 million in revenue in 2023, solidifying the Company’s position as a trusted cybersecurity provider across North America and NATO countries. In April, Plurilock announced a 10:1 share consolidation to optimize the capital structure. The Company also settled outstanding payables through share issuance and converted debentures to conserve working capital. The Company also announced a $3 million financing to grow Critical Services and expand the sales team (along with a change in sales strategy for this line of business). Plurilock closed an upsized $4.5 million and due to overwhelming demand, undertook an additional private placement for $1 million, for total gross proceeds of $5.5 million. Plurilock has streamlined operations across all business units, fully integrating the Company’s four key acquisitions, as well as identifying and implementing cost-saving measures, realizing $2 million in savings annually which are being reallocated into the higher margin critical services division to support and drive growth. https://bit.ly/4bWMYew

Sophic Client Plurilock (PLUR-TSXV, PLCKF-OTCQB) named 2024 Quadrant Champion by Info-Tech for fifth year.

Plurilock announced that its flagship cybersecurity platform, Plurilock AI, has been named a Data Quadrant gold medalist by Info-Tech for 2024. This is the fifth year running in which Plurilock’s cybersecurity platform has earned the largely performance-based award. According to Info-Tech’s quadrant rankings, which are based both on analyst evaluations and on feedback from existing customers, over 90% of Plurilock AI customers would recommend the platform to others in 2024. This “would-recommend” percentage was significantly higher for Plurilock AI than for any other product evaluated in the segment, eclipsing offerings from Microsoft, Palo Alto, Cisco, Oracle, and Broadcom. https://bit.ly/4bYrFcJ

Sophic Client Xcyte Digital (XCYT-TSXV) announces strategic partnership with Pixel Canvas.

Xcyte Digital Corp. announced a strategic partnership with Pixel Canvas. Pixel Canvas is a provider of high-fidelity visuals on the web through cloud rendering, eliminating the need for app downloads and enabling seamless streaming directly to browsers on any device. Pixel Canvas specializes in hyper-engaging virtual experiences that not only attract attendees but also drive increased engagement and immediate ROI. Pixel Canvas’ wide range of clients include: LG, Verizon, Warner Media, SS&C, British Telecom, Bain & Company, Planet Hollywood, and Arizona State University among others. This collaboration simplifies professional-grade broadcasting, eliminating the challenges typically associated with traditional production setups. Upcoming events delivered via this platform in the fall of 2024 include, MCON 2024, which will expanding to reach audiences virtually for the first time and Xcyte’s soon to be released financial industry platform. https://bit.ly/3LC61QM

Model Developer Cohere raises US$500 million at US$5.5 billion valuation.

Canadian model developer Cohere announced on Monday that it has raised US$500 million in funding at a US$5.5 billion valuation, in a round led by Canadian pension fund PSP Investments and including Canada’s export credit agency EDC, AMD Ventures. With the new capital, Cohere will have raised close to US$1 billion in total, making it one of the best-funded AI developers. However, unlike OpenAI and Anthropic, Cohere doesn’t offer a consumer chatbot and focuses instead on business-facing conversational AI that can be accessed by developers through application programming interfaces. https://tinyurl.com/2wccm4nz

Cohere lays off five percent of staff a day after announcing US$500-million Series D.

Shortly after announcing US$500 million in Series D funding, Toronto-based generative artificial intelligence (AI) startup Cohere laid off approximately five percent of its employees. These staff cuts impacted around 20 of the enterprise-focused OpenAI competitor’s 400-person workforce across multiple offices. The layoffs were first reported by Fortune and have since been confirmed by BetaKit. Cohere’s Series D, which BetaKit previously reported in June, was announced on June 22 and ultimately valued Cohere at $5.5 billion, making it one of Canada’s most valuable tech startups. Gartner confirmed to BetaKit that the round was financed by new investors, including Canadian public sector pension investment manager PSP Investments, American networking tech firm Cisco, the venture arm of United States (US) chip company AMD, Crown corporation Export Development Canada, US alternative asset manager Magnetar Capital, and Japanese tech services giant Fujitsu. Per Gartner, existing backers Nvidia, Salesforce Ventures, and Oracle also participated in the all-equity financing, which he said did not include any secondary capital. https://tinyurl.com/4xrhsu3s

Clio tops $4-billion valuation with largest software funding round in Canadian tech history.

Already one of Canada’s highest-valued technology startups, Clio claims its new Series F round makes it the most valuable cloud-based legaltech company in the world. Buoyed by strong revenue growth, the Burnaby, BC-based unicorn has closed the fresh funding at a more than $4-billion pre-money valuation. Clio’s $1.24-billion Series F also marks the largest software funding round in Canadian tech history, topping Toronto-based 1Password’s $744-million 2022 Series C round. Clio also claims it represents the largest-ever capital raise for cloud legal software, a top five largest fundraise for a vertical market software company historically, and the largest growth equity capital raise in Canadian history. The legal software-as-a-service (SaaS) provider’s all-equity Series F round was financed entirely by new United States (US) investors. New Enterprise Associates (NEA) led with support from Goldman Sachs Asset Management, Sixth Street Growth, Alphabet’s CapitalG, and Tidemark. It comes shortly after Clio crossed US$200 million in annual recurring revenue (ARR), the company claimed, up from US$100 million in 2022. Selling cloud-based legal practice management software, Clio aims to simplify law firm management by centralizing client intake, case management, document management, and legal payments, and other tasks. As public markets have stagnated, many companies are staying private for longer or ceasing to go public altogether, and looking for alternative ways to generate liquidity for existing shareholders. In the tech world, US payments giant Stripe is an example of this. Clio was founded back in 2008. Like its Canadian tech peers of approximately the same age, 1Password and Vancouver-based Hootsuite and Trulioo, 16-year-old Clio has opted to remain private rather than go public. Newton noted that while Clio is “continually evaluating” and preparing for the possibility of an initial public offering (IPO), this round gives the company some optionality. “As we’ve demonstrated with this round, you can achieve many of the same goals that you might try to achieve with an IPO in the private markets,” he said. However, should Clio decide to pursue an IPO, Newton acknowledged that its lead Series F investor has a lot of experience taking companies public: according to Florence, NEA has helped over 300 businesses do just that to date. https://tinyurl.com/3duyev23

Cold storage giant Lineage raises US$4.4 billion in largest IPO of 2024.

Lineage — which has 480 warehouses across North America, Europe, and the APAC region — now boasts a market value of US$19 billion, according to Bloomberg. The outlet notes it’s the biggest IPO since Arm Holdings went public in September 2023. Lineage is now trading on the Nasdaq under the LINE symbol. Once obscure within the real estate market, cold storage has grown in demand due to the increased popularity of fresh foods and the antiquation of many older facilities. Lineage has been on an acquisition spree for roughly a decade, and in 2021 purchased Crystal Creek Logistics as it entered the cold-shipped e-commerce market. https://tinyurl.com/49rw53ms

Honeywell weighs Quantinuum IPO at US$10 billion valuation.

Honeywell International Inc. is considering an initial public offering of its majority-owned quantum computing firm Quantinuum as soon as next year, according to people with knowledge of the matter. The firm has held discussions with several investment banks about a potential listing in the US and could seek a valuation of about US$10 billion for Quantinuum. Honeywell shares jumped as much as 2.6% on Friday following the Bloomberg News report, their largest intraday move since early June. They have declined about 2% this year, valuing the company at around US$133 billion. Deliberations are at an early stage and details of the plan could change. Quantinuum was formed in 2021 by the merger of Cambridge Quantum and Honeywell Quantum Solutions. It has about 500 employees across offices in the US, UK, Germany and Japan, according to its website. In January, Honeywell closed a US$300 million funding round for the quantum computing firm at a pre-money valuation of US$5 billion. JPMorgan Chase & Co. led the fundraising with participation from Mitsui & Co. and Amgen Inc. Honeywell also re-invested. The January round took Quantinuum’s total fundraising to about US$625 million since its inception. Quantum computers harness the unique properties of atoms, employing quantum bits, or qubits, that provide exponentially more computing power than computer code that uses ones and zeroes. Quantum-computer makers, including International Business Machines Corp., have been improving the technology to reduce errors and scale up the number of qubits. https://archive.ph/YPHdT

Revolut targets valuation jump to US$45 billion in sign of fintech revival.

Revolut, already the world’s second most-valuable fintech startup after Stripe, is in talks to sell the shares to new shareholders, including New York-based Coatue Management, and existing investors such as Tiger Global Management. Revolut, which competes with incumbent banks for retail and business customers, has also been in talks with investment firm Greenoaks as a potential participant. A deal, if completed, could be announced in the coming days and would pave the way for a potential initial public offering. The stock sale would increase Revolut’s valuation by more than a third. The company was valued at US$33 billion in 2021 when it raised US$800 million from a group led by Tiger and SoftBank Group’s Vision Fund unit. Japan’s SoftBank isn’t buying shares in the latest offering. Revolut won’t gain fresh funds from the share sale to plow back into its operations. Instead, the effort allows long-term employees to cash out some of their holdings, while setting a floor for the company’s potential valuation ahead of any IPO. Documents provided to investors show that Revolut has begun to churn out profits. It reported US$429 million of net income in 2023, and forecasts US$976 million of profit in 2024. Revenue grew to US$2.2 billion in 2023 and is projected to hit US$3.7 billion in 2024, as businesses and households increasingly migrate to its digital-only finance platform. https://archive.ph/AnUWu

Wiz and Google end US$23 billion deal talks.

Wiz has ended deal talks with Google after the tech giant offered to acquire the startup for US$23 billion, Wiz told staff on Monday. The cybersecurity startup instead plans to pursue an initial public offering and aims to surpass $1 billion in annual recurring revenue this year, according to an email Wiz CEO Assaf Rappaport sent to staff. “Saying no to such humbling offers is tough,” Rappaport wrote, adding that “the market validation we have experienced … only enforces our goal” of going public. Wiz, which sells software to protect companies’ applications running in the cloud, has raised US$1.9 billion from investors, most recently at a US$12 billion valuation in May. The company’s now-shuttered deal talks with Google would have doubled that valuation and returned more than US$7 billion to investors including Index Ventures, Sequoia Capital, Insight Partners, Greenoaks Capital Partners, Advent International, and Israeli venture firm Cyberstarts. But some investors saw the deal as unlikely given recent scrutiny from antitrust regulators on tech mega-deals. https://tinyurl.com/y2p6s7jn

Grab buys Singaporean dining reservation platform Chope.

Southeast Asia’s biggest ride-hailing and food delivery firm, has bought Singaporean dining reservation platform Chope for an undisclosed price, according to confirmation from both companies on Tuesday. “We believe the addition of Chope’s products and services provides more synergies for our merchant-partners, especially in helping them capture online-to-offline opportunities,” a Grab spokesperson said in a statement. Business Times first reported on the acquisition on Monday, citing an internal email seen by the publication. Grab said in the statement that its focus is to help level the playing field for small and medium-sized businesses, which form the majority of merchants on its platform and which lack the resources of bigger brands. Chope founder Arrif Ziaudeen said in a statement that it has chosen to seek a partner to help it pursue new opportunities for sustainable growth in a challenging and competitive market. “We evaluated potential buyers and found the best fit with Grab – a company with a mission aligned to ours in connecting restaurants to diners,” he added. Founded in 2011, Chope is available in seven cities Singapore, Hong Kong, Bangkok, Phuket, Shanghai, Bali, and Jakarta, with over 13,000 restaurants listed on its platform, according to its websites. https://tinyurl.com/ydknetws

Bally’s has agreed to be acquired by its largest stockholder, Standard General, in a deal that values the casino and gaming company at US$4.6 billion, including debt.

The hedge fund already owns nearly 23% stake and has agreed to pay US$18.25 per share in cash for the rest of the shares, a premium of about 35% to the company’s last closing price. Shares of Bally’s jumped nearly 26% in premarket trading. After the deal, Bally’s will combine with the Queen Casino & Entertainment (QC&E), a regional casino operator majority-owned by funds managed by Standard General. Standard General made an offer to acquire the remaining stake in March for US$15 per share. The final agreement comes at a significant discount to the hedge fund’s first offer of US$38 per share in 2022. https://tinyurl.com/2d9khac5

Informa to buy Cannes Lions owner Ascential for £1.2 billion.

Informa Plc has agreed to buy Ascential Plc, the owner of the Money20/20 and Cannes Lions conferences, for about £1.2 billion (US$1.5 billion) in cash to expand its events business. Informa will pay Ascential investors about 568 pence per share, the company said in a statement on Wednesday. That’s a 53% premium to the company’s closing share price on Monday. The deal, which must still be approved by shareholders, is expected to close in the fourth quarter. Informa said it plans to help expand the Ascential conference brands and will help push the Money20/20 conference into the Middle East and Africa to take advantage of investor interest in fintech and payments. Informa flagged earlier this year that rising interest in events in countries including the United Arab Emirates and Saudi Arabia was helping to boost earnings. Informa separately increased its profit outlook for the second time this year, buoyed by “underlying growth, international expansion and AI partnerships,” it said on Wednesday. It now expects adjusted operating profit of up to £1 billion (US$1.3 billion) for 2024, up from a previous expectation of as much as £970 million. The Cannes Lions conference, held every year in France for the advertising industry, will become part of a new Informa Festivals business. Informa hosts conferences, exhibitions and training courses around the world. Events in the Middle East include the region’s Film and Comic Con in Abu Dhabi and Jewellery Arabia in Bahrain. Ascential shares closed 23% higher on Tuesday in London trading at 446.80 pence. Informa shares were little changed at 847 pence. https://archive.ph/hP4k9

Anthropic projected to burn more than US$2.7 billion in cash this year.

Around the start of the year, Anthropic projected it would burn more than US$2.7 billion in 2024 as it developed new conversational artificial intelligence, The Information reported. Valued at US$18 billion in a March financing, the OpenAI rival projected about US$800 million in annualized revenue, or US$67 million a month, by the end of 2024. But because Anthropic shares revenue with Amazon—which runs the startup’s models on its cloud platform while reselling them to its own customers—Anthropic’s annualized revenue after the payout could be 25% to 50% lower than that. Those figures suggest that Anthropic is operating much less efficiently than OpenAI, which could lose up to US$5 billion this year despite generating US$3.5 billion to US$4.5 billion in revenue. https://tinyurl.com/87huedty

IBM shares jump on earnings and revenue beat.

IBM shares rose 5% in extended trading on Wednesday, after the company reported second-quarter results that surpassed analysts’ predictions. The company, which provides hardware, software and consulting services, now expects 2024 free cash flow to come in above US$12 billion. In April, executives were calling for about US$12 billion. The company’s book of business for generative artificial intelligence now stands above US$2 billion, CEO Arvind Krishna was quoted as saying in the statement. The number was over US$1 billion in April. Notwithstanding Wednesday’s after-hours move, IBM shares are up 14% year to date, in line with the S&P 500. https://tinyurl.com/mrhsave5

Google’s ad revenue growth softens slightly in Q2.

Alphabet’s net income surged 29% to US$23.6 billion in the second quarter on 14% higher revenue, reported 14% higher revenues in the second quarter even as its ad business showed signs of slightly weakening from the first quarter. YouTube’s ad growth slowed to 13% from 21% in the first quarter, while Google’s search ad revenue also slowed slightly to 13.8%. Google’s ad network revenue—the sale of ads on sites owned by other companies—fell 5%. It had fallen slightly in the first quarter. Google’s cloud business, however, strengthened slightly, posting 29% higher revenue of US$10.3 billion while operating income nearly tripled to US$1.17 billion. But, as the company had foreshadowed, capex spending nearly doubled in the quarter, reflecting investment in AI-related equipment. https://tinyurl.com/bf2ru3f3

Tesla reports 45% drop in second-quarter profit.

Tesla shares fell more than 8% in after-hours trading after the company reported a 45% drop in second-quarter profit year on year. The electric vehicle maker has now reported lower deliveries for two consecutive quarters and missed Wall Street earnings forecasts for four straight quarters. Analysts expect Tesla’s EV deliveries to drop for the year as a whole, for the first time since 2010. In a call with analysts, CEO Elon Musk confirmed that Tesla had delayed the reveal of its autonomous Robotaxi until Oct. 10, two months later than originally planned. Musk said the added time allowed the company to improve the prototype and to “show a couple of other things,” without specifying what those are. Revenue rose 2% to US$25.5 billion, boosted by a near-doubling of revenue from energy generation and storage. Automotive revenue fell 7% to US$19.9 billion, as Tesla delivered 5% fewer EVs. The drop of the share price was not surprising: Tesla shares had risen 73% since April 23, when Musk announced he would unveil the Robotaxi on Aug. 8. https://tinyurl.com/2tmk9swv

Musk considers US$5 billion tesla investment in xAI.

Tesla CEO Elon Musk said he will ask the company’s board of directors to consider investing US$5 billion in xAI, his artificial intelligence company. Musk posted a note on X, the social network formerly known as Twitter that he controls, after more than two-thirds of respondents supported the investment idea in a poll that Musk launched on X last week. In posting the poll, Musk acknowledged that Tesla’s board and shareholders would have to approve any investment. Musk did not specify why he wanted Tesla to invest in xAI, but xAI’s planned data center could be useful for Tesla’s self-driving software and planned humanoid robots. https://tinyurl.com/bdff5p42

Spotify reports record revenue in second quarter.

Spotify posted a 20% increase in second-quarter revenue and lower operating expenses, boosting quarterly profit and free cash flow. Shares rose 12%. The audio service reported revenue of just over US$4 billion and operating income of US$289 million, reversing an operating loss of US$268 million in the same period last year. Spotify said it added 7 million subscribers in the quarter, 1 million more than the company forecast. Operating expenses fell 16% from the same period a year earlier, to US$918 million, after the company trimmed its staff by 17% in December, laying off over 1,500 employees. Cash flow soared to US$532 million, from US$9.8 million. Last month, Spotify raised its subscription prices for the second time in less than a year. https://tinyurl.com/bdh4vned

GM’s Cruise abandons Origin robotaxi, takes US$583 million charge.

GM’s self-driving car subsidiary Cruise is scrapping plans to build the Origin — a purpose-built robotaxi with no steering wheel or pedals — and will instead use the next-generation Chevrolet Bolt in its operations. https://tinyurl.com/3pvuttj3

Alphabet is pouring billions into Waymo’s self-driving taxis as Tesla prepares to reveal its rival.

Alphabet isn’t alone in targeting the autonomous vehicle market. Tesla has been talking up its own self-driving future, even though a much-awaited event revealing more about its plans has been pushed back from August to October. Reviews of Waymo (including Business Insider’s own) have been positive, but the service has experienced issues around its driverless cars. The company issued a recall after two of its vehicles were involved in accidents in December. Still, it appears Alphabet is optimistic about Waymo’s future. https://tinyurl.com/4wa927wj

OpenAI is launching search engine, taking direct aim at Google.

OpenAI is launching a test version of its long-awaited search engine, which it says will cite sources of information including news from business partners such as The Wall Street Journal parent News Corp and the Atlantic magazine. The tool, called SearchGPT, will summarize the information found on websites, including news sites, and let users ask follow-up questions, just as they can currently with OpenAI’s popular chatbot, ChatGPT. The sources are linked at the end of each answer in parentheses. SearchGPT is OpenAI’s most direct challenge yet to Google’s dominance in search since the release of ChatGPT in 2022 caught the tech company flat-footed. Google this year widely rolled out its own AI search feature that synthesizes information from multiple web sources. Shares in Google-parent fell by nearly 3% Thursday. Other AI companies are also entering the search battle, including Perplexity, which is backed by Jeff Bezos and founded by a former OpenAI employee. OpenAI said it partnered with publishers to build the search tool. In recent months, OpenAI representatives have shown mock-ups of the feature to publishers, who have grown increasingly uneasy about the way AI could reshape their newsrooms and newsgathering amid recent declines in online traffic for many publishers. Publishers are leery of tech partnerships after more than a decade of dealing with the whims of tech companies including Meta Platforms’ Facebook and Google, whose product changes could sometimes trigger violent changes in online traffic. Their fears were further fanned when last month Perplexity repurposed a story by Forbes magazine for one of its products and didn’t mention the news source until the bottom of the page. Chief Executive Aravind Srinivas attributed the issue to the product’s “rough edges.” Even so, many publishers see value in selling access to their intellectual property to AI companies who need massive amounts of data and content to refine their AI systems and create new products like SearchGPT. Over the past year, OpenAI has struck partnerships with a litany of news publishers including Politico and Business Insider’s parent, Axel Springer; the Associated Press; Le Monde; the Financial Times; and IAC’s Dotdash Meredith, home of such publications as People and Better Homes & Gardens. In some of those deals, OpenAI has extended millions of dollars in cash and cloud credits to publishers in exchange for the right to train new generative AI models on their work. https://archive.ph/5KKgp

Meta releases largest version of Llama 3 to date.

Meta Platforms on Tuesday released the largest version of Llama 3, its flagship open-source large language model, to date. Unlike other recently released models, it will not be able to handle images, video or speech, despite expectations that it would. The model released Tuesday, called Llama 3.1, understands and responds with text. Meta is working on adding image recognition, video recognition and speech understanding capabilities to the model, its researchers wrote in a paper about Llama 3. The versions with those capabilities “are still under active development and not yet ready for release,” the researchers wrote. Llama 3.1 now powers Meta AI, the artificial intelligence assistant available in Meta’s apps and Ray-Ban smart glasses. Hundreds of millions of people have used Meta AI, Meta CEO Mark Zuckerberg said in a post on Instagram. Llama 3.1 has 405 billion parameters, which are the settings that encode what models learn during training. https://tinyurl.com/y93tecc6

Reddit lands content partnerships with NFL, NBA, MLB.

Reddit Inc. is partnering with several major sports leagues to bring more video content to the site in hopes of boosting advertising revenue. The San Francisco-based social media company announced deals with the NFL, NBA, MLB, PGA Tour and NASCAR on Monday. The partnerships will bring more sports content to Reddit’s site, including video highlights from games and tournaments, behind-the-scenes clips, question-and-answer sessions with players, and special content from major events such as the Super Bowl and NBA All-Star game. Reddit shares gained 6.5% to US$68.90 at 1:44 p.m. om New York. The stock had jumped 90% this year through Friday’s close. Financial details from the partnerships were not disclosed. The move will give Reddit more high-quality videos, which in turn could lure more video advertisers. Reddit first tested those ads with the NFL during the 2023-2024 season, and brands like FanDuel, Samsung and Ford placed their messages next to premium video content from the league. Reddit has invested heavily in its advertising business over the past several years, and went public in March after almost two decades as a privately held company. Reddit executives have been vocal about plans to expand the types of promoted messages on its site, including adding more video and shopping ads. Last year the company brought in sales of US$804 million, 98% of which came from advertising. The text-based site currently hosts ads on a scrolling feed and next to posts within interest-based communities. Reddit, which is primarily text-based, has been slower to adopt video ads than rival sites like X, formerly known as Twitter. X started expanding into video as early as 2016, and video ads eventually became a US$1 billion business for the site, JMP Securities analysts wrote in a note. JMP predicts Reddit could also generate more than US$1 billion in sales from video ads. https://archive.ph/cfWuG

NBA announces US$77 billion tv and streaming deals with Amazon, Disney and NBCU.

The NBA announced US$77 billion in new TV and streaming rights deals with Disney’s ESPN, Comcast’s NBCUniversal and Amazon, significantly reshaping how games from one of the most popular sports leagues will be watched by fans starting with the 2025 season. The new 11-year deals, which will run through the 2035-2036 season, will see Disney pay the NBA an average fee of US$2.6 billion per year, up from the US$1.5 billion Disney pays under its existing deal. NBCU, meanwhile, has agreed to pay US$2.5 billion per year and will air games on its NBC broadcast network and Peacock streaming service. Amazon is paying US$1.9 billion per year. Earlier in the afternoon, the NBA rejected Warner Bros. Discovery’s proposal to match the Amazon rights. This would end a decades-old relationship between the companies with the next season being the last on WBD’s TNT cable network and Max streaming service. The NBA’s deal with Amazon is notable beyond making Amazon the first streaming video giant to exclusively broadcast NBA games in the U.S. Amazon will also be streaming NBA games globally on Prime Video in markets including multiple European countries, Mexico and Brazil. The NBA will also start to distribute its League Pass subscription streaming service through Prime Video globally. The service offers access to out-of-market games during the regular season. https://tinyurl.com/3ykmkcz7

NBA Rejects Warner Bros. Discovery’s proposal for sports rights deal.

The NBA is rejecting Warner Bros. Discovery’s proposal to match one of its new NBA rights deals, which is setting the stage for a legal dispute between the league and one of its longest broadcasting partners. In a statement, the NBA said WBD’s proposal did not match the terms that the league has agreed to with Amazon Prime Video, which is set to become the first exclusive streaming partner in the U.S. for the league starting with the 2025 season. Amazon has agreed to pay the NBA roughly US$1.8 billion per year for the rights, which include regular season and playoff games, as well as the NBA’s in-season tournament. WBD sought to prove that between its cable networks and its Max streaming service, it could be a TV-and-partner for the league. The NBA is refuting this. “Throughout these negotiations, our primary objective has been to maximize the reach and accessibility of our games for our fans,” it added in its statement. After publication, WBD’s TNT Sports released a statement arguing that the NBA can’t reject its matching proposal for the Amazon rights. “We think they have grossly misinterpreted our contractual rights with respect to the 2025-26 season and beyond, and we will take appropriate action.” https://tinyurl.com/3rzjauj3

Google reverses decision to end ad trackers in Chrome.

In an unexpected reversal, Google on Monday said in a blog post that it would no longer phase out cookies, trackers that websites use to follow people as they browse the internet so they can target them with ads and other services, on its ubiquitous Chrome browser. The change is a win for a slew of numerous companies that compete with Google in selling ads, including ad technology providers and news publishers such as News Corp. Four years ago, Google rocked those industries by announcing it would eventually kill cookies. Google’s initial decision came after Apple ended certain forms of tracking on iPhones and in the company’s Safari browser, which put pressure on Google to do the same. But after Google announced the cookie phase-out plan, its rivals complained to regulators that the move would only strengthen Google’s dominant grip on ad sales and technology, at their expense, The Information reported. More recently UK regulators said Google’s plan was flawed, allegedly because it didn’t go far enough to let people stay anonymous if they wanted to. On Monday, Google implied it had a plan to give its customers more “choice” on how they want to be tracked, but the post didn’t elaborate. https://tinyurl.com/5htrn2rs

CrowdStrike warns of hacking threat as outage persists.

The CrowdStrike glitch that caused outages for millions of users of Microsoft Windows devices last week continued to roil industries and snarl global air travel. Around 8.5 million devices were affected by the outage, CrowdStrike said in a statement, adding that it had brought a significant number back online. Warning customers that bad actors were trying to exploit the event, the company said it had identified a malicious file being sent around by hackers posing as a ‘quick fix’ to the problem. A file named “crowdstrike-hotfix.zip” was being distributed that included malware enabling hackers to remotely control or monitor a user’s device, CrowdStrike said in a blog post. Shares of CrowdStrike dropped more than 13% Monday. The stock has lost nearly one-fourth of its value over the past two trading days following the outage. On Monday, Republican members of the Homeland Security Committee sent a letter to CrowdStrike Chief Executive George Kurtz, asking him to testify before lawmakers. They gave him a deadline of Wednesday evening to schedule a time to testify. “Protecting our critical infrastructure requires us to learn from this incident and ensure that it does not happen again,” the letter said, which was signed by Congressmen Mark Green of Tennessee and Andrew Garbarino of New York. https://tinyurl.com/mvwu25d2

Nvidia adapts its new AI chips for china despite tightening U.S. export controls.

Nvidia is working on modifying its latest artificial intelligence chips to comply with U.S. export controls for China, Reuters reported. In response to the multiple rounds of U.S. rules on semiconductor exports to China, Nvidia has been taking proactive steps to develop chips tailored for this market, such as the lower-performance H20 chips modified from its flagship H100 series. One upcoming chip tailored for the China market, tentatively known as the “B20,” is part of Nvidia’s new line of Blackwell chips launched in March. The Blackwell series, comprising the B100 and B200 chips, is scheduled to enter production later this year. It’s unclear how Nvidia designs the B20 to align with U.S. rules while keeping competitive in China. Additionally, as the U.S. plans to impose stricter export controls on advanced chips and equipment, Nvidia’s move may encounter challenges. https://tinyurl.com/4br69xsc

Temu opens up marketplace to European merchants.

Temu has opened up its platform to European sellers, as the Chinese bargain-shopping site ramps up offering of locally shipped products in an intensifying rivalry against Amazon. Since last week, merchants who have corporate entities registered in Europe and who hold European passports can apply to join Temu’s local warehouse program, according to a presentation by Temu viewed by The Information. For sellers who have European corporate entities but hold Chinese passports, Temu requires the applications be made with an European entity under an existing Amazon storefront, the presentation says, in a direct attempt at wooing Amazon’s third-party sellers in China. Launched in March, the local warehouse program has quickly gained traction among consumers. It requires merchants to already have inventory stored in the markets where they are selling and to handle delivery themselves. While the program is available to consumers in North America, Europe, Australia and New Zealand, up until last week only sellers with corporate entities or passports in the U.S., mainland China and Hong Kong could apply to sign up. https://tinyurl.com/2kfbahuw

Ether ETFs begin trading after SEC approvals.

Exchange-traded funds holding spot ether tokens begin first-day trading on Tuesday, after nine issuers including BlackRock, Fidelity, and Franklin Templeton received full approvals from the Securities and Exchange Commission. Ether, the second largest cryptocurrency, rose above US$3,500 on Tuesday ahead of the ETF debut. Bloomberg Intelligence analysts expect net inflows for the spot ether ETFs to reach about 20% of bitcoin ETF levels, totaling US$5 billion to US$6 billion in the first year. Eight of the issuers picked Coinbase as their crypto custodians, while VanEck chose Gemini for the role. https://tinyurl.com/anewccm7

Ferrari extends cryptocurrency payment system to Europe after US launch.

Ferrari said on Wednesday it would extend its scheme to accept payments in cryptocurrency for its luxury sports cars to its European dealers network from the end of this month, after starting in the United States last year. The Italian company will also extend the scheme by the end of 2024 to other dealers of its international network, in countries where cryptocurrencies are legally accepted, it said in a statement. Although the vast majority of blue-chip companies have steered clear of crypto as the volatility of bitcoin and other tokens make them impractical for commerce, Ferrari started last year to accept payments in cryptocurrency in the U.S., to meet requests from its wealthy customers. https://tinyurl.com/8sscscj7

Nvidia to start using samsung’s advanced memory for AI chips.

Nvidia has told suppliers that it will start incorporating Samsung Electronics’ fourth and fifth-generation advanced memory chips, HBM3 and HBM3E, into its AI chip cards, according to two people who received notices from Nvidia. HBM, which stands for high bandwidth memory, is crucial to improving data processing speed, particularly for AI that demands substantial computing power. The limited HBM production capacity last year created a major bottleneck for Nvidia’s AI chip supply, when market demand was soaring amid the global AI boom. With Samsung now entering the HBM supply chain, Nvidia is expected to secure enough memory components to ramp up its AI chip production. Reuters first reported that Samsung’s HBM3 has passed Nvidia’s quality test and will be used in its less advanced AI chips, such as the H20, which is tailored for the Chinese market to comply with U.S. export controls. https://tinyurl.com/yx6m655m