May 14, 2023: Private Valuations In Free Fall But Couple IPOs Coming

Markets looked a bit weaker by Friday’s close, as Dow Jones fell 1.1% last week, S&P 500 was down 0.3%, and Nasdaq composite was up 0.4%. The median valuation for growth-stage startups fell to US$90 million in the first quarter, a 75% drop from 2021, according to research firm PitchBook. Klaviyo filed confidentially for a U.S. IPO. PayPal’s profit rises 56% as expenses kept in check. Airbnb reported 20% higher revenue in the first quarter, which it credited to a roughly equivalent increase in the number of nights and experiences booked. Palantir soars 15% after company reports strong earnings and says demand for its AI tool is ‘without precedent’. Berkshire Hathaway cuts stake in EV maker BYD as Warren Buffett and Charlie Munger say they don’t want to compete against Elon Musk. Tesla recalls virtually every car it has sold in China. Shortage of AI servers prompts Microsoft-Oracle negotiations. Google CEO discloses ‘Gemini’ AI to rival OpenAI’s GPT. Metaverse could contribute up to 2.4% of US GDP by 2035, a new study shows. Apple’s Reality Pro headset still coming to WWDC, but Apple is ‘anticipating production issues’. Meta unveils generative AI tool for advertisers. Nintendo warns of big slowdown in Switch console sales. Netflix reportedly plans to cut spending by US$300 million this year. Sophic Client, Kraken Robotics received a $16 million order for SeaPower batteries. Sophic Client LuckBox announced April KPIs including Global Customer Deposits and Player Growth – the Company announced a major step towards profitability in April, by outperforming last month’s record player deposits, all with 40% less Marketing spend. Crypto mining companies like Hive and Hut 8 Mining are finding opportunities to repurpose their GPU-based equipment for another industry on the precipice of a possible boom: artificial intelligence, according to Bloomberg.

Sophic Client Kraken Robotics (PNG-TSXV, KRKNF-OTC) receives $16 million order for SeaPower batteries.

Kraken Robotics, announces that it has received a purchase order for subsea batteries valued at $16 million. Deliveries will occur in 2023 and 2024. The purchase order includes a significant advance payment. With this order Kraken has now received more than $30 million of purchase orders in the last 6 months for its SeaPower® subsea batteries. Since the beginning of 2022, Kraken has announced more than $120 million of contracts providing us solid visibility for our strong growth trajectory we are on. https://bit.ly/44K7L2w

Sophic Client LuckBox (LUCK-TSXV, LUKEF-OTC) announces April KPIs including Global Customer Deposits and Player Growth.

Real Luck Group, an award-winning provider of licensed, real money esports betting, sports betting and casino games, announces a major step towards profitability in April, by outperforming last month’s record player deposits, all with 40% less Marketing spend. The player base continued to grow; from 387,000 at the end of March to 420,000 by the end of April with the average stake per player growing by over 17% month on month, and over 80% versus Q1 2023. This has exceeded all expectations, considering the sizable reduction in marketing spend. April’s results were led by data driven traffic source optimization, CRM and product improvements. https://bit.ly/3pCPUKQ

AI needs specialized processors. Crypto miners say they have them (HUT-TSX, HUT-NYSE & HIVE-TSXV, HIVE-NASDAQ).

Companies that used and hosted GPUs, or graphics processing units, saw a key part of their once-booming business vanish against an increasingly difficult backdrop for crypto. But now mining infrastructure companies like Hive Blockchain and Hut 8 Mining are finding opportunities to repurpose their GPU-based equipment for another industry on the precipice of a possible boom: artificial intelligence. As such, Hut 8 and a few other miners have been using the chips to power high-performance computing, or HPC, services for clients across a range of industries. Hut 8 said its HPC business generated about US$16.9 million in 2022 — representing about 11% of overall revenue — after just one year of operations, driven in part by AI clients. Likewise, Hive Blockchain — which purchased US$66 million worth of GPUs from Nvidia Corp. in early 2021 — said it aims to grow its HPC revenue tenfold to US$10 million in 2024 and by as much as 20 times current levels by 2025. Currently analysts tracked by Bloomberg are forecasting about US$98 million in overall revenue for the company in 2024. Not all crypto miners are in a position to capitalize on the frenzy around AI or the glut of expensive chips on hand. According to Bitpro Consulting, which offers brokerage services for miners, between 5% and 15% of existing crypto-oriented GPUs can be repurposed for AI and adjacent applications like computer vision and generative graphic design. https://bloom.bg/3BnxIaM

Koïos Intelligence raises $6.5 million to expand conversational AI assistant for insurance brokers.

Montréal startup Koïos Intelligence, which provides an artificial intelligence (AI)-powered assistant for insurance professionals, has raised $6.5 million in a combination of equity, debt, and “other call options.” Investors in this round included Propulia Capital, Canada Economic Development, Export Development Canada, Caisse Desjardins des Technologies, and other private investors that were not named. The lead investor was not disclosed. Koïos did not explain the other call options in the funding round. https://bit.ly/3I6BwBd

Carbonhound raises $1.3 million help small, medium business get ready for emissions regulations.

Toronto startup Carbonhound has raised $1.3 million in pre-seed funding towards its mission of helping small and medium-sized businesses (SMBs) manage upcoming greenhouse-gas emission regulations. This round marks Carbonhound’s first fundraise to date, and comes from a network of Kitchener-Waterloo and Toronto investors. https://bit.ly/42Oa1nR

Cathie Wood-linked ETF firm is shut down by Canada regulator.

Ontario’s securities watchdog suspended the registration of Emerge Canada Inc., an investment firm known for selling Toronto-listed versions of Cathie Wood’s popular exchange-traded funds. The Ontario Securities Commission said the firm has failed to comply with its capital requirements since at least September and ordered it to wind down, or find another company to take over its activities. Emerge Canada is banned from being an investment fund manager, portfolio manager or exempt-market dealer, according to an order from the OSC’s director of compliance and registrant regulation. Emerge has been unable to file audited financial statements for 2022 after its auditor quit. In April, regulators hit the investment firm with trading bans on 11 of its funds — including six Ark Investment Management-partnered funds that follow Wood’s investment strategies — leaving investors in those products in limbo. Emerge Canada owes Emerge Ark ETFs about C$5.5 million ($4.1 million), according to the regulatory filing — and it can’t pay unless it receives millions of dollars it’s owed by Emerge Capital Management Inc., a US affiliate, according to the regulatory document. A spokeperson for Ark was unable to immediately provide comment. https://bloom.bg/44XvQmH

Binance pulls out of Canada amid new crypto regulations.

Binance said on Friday it was withdrawing from Canada, weeks after the country issued a series of new guidelines for cryptocurrency exchanges including investor limits and mandatory registrations. Canada has tightened regulations for crypto asset trading platforms in recent months, with the introduction of a pre-registration process. The companies that do not adhere to the rules will face potential enforcement action, according to the website of the Ontario Securities Commission. https://reut.rs/41xd5Ui

Startup valuations are in free fall.

The median valuation for growth-stage startups fell to US$90 million in the first quarter, a 75% drop from 2021, according to research firm PitchBook. At the same time, the median deal size fell to US$7 million, the lowest since the second quarter of 2017. Rising interest rates have created a liquidity crunch for VC-backed startups and fostered an investor friendly market that’s made raising capital at high valuations much more challenging. A dire market for initial public offerings has also challenged late-stage startups, in particular. The valuations of IPO-ready startups have fallen as much as 93% from their most recent funding rounds, according to another data provider, Caplight, The Information reported this week. https://bit.ly/3M0smY6

SoftBank’s Vision Fund reports US$2.3 billion loss.

SoftBank’s Vision Fund business recorded an investment loss of US$2.3 billion in the quarter through March, as the fair value of its stakes in private startups declined despite a modest recovery among publicly listed stocks. The results show how SoftBank continued to face a challenging environment in the quarter. Over the past year, Vision Fund, the world’s largest tech investor whose vast portfolio includes both public and private companies, has struggled to cope with a global stock market rout amid recession fears. For the full fiscal year that ended March 31, SoftBank Group as a whole recorded a net loss of 970.1 billion yuan (US$7.2 billion) due to Vision Fund’s investment losses. As of March 31, the total fair value of the portfolios of SoftBank’s Vision Fund 1, Vision Fund 2 and its LatAm Funds that focus on Latin America, stood at US$138 billion, according to the company. https://bit.ly/3M4DgvE

Klaviyo files confidentially for U.S. IPO -sources.

Data and marketing automation firm Klaviyo Inc confidentially submitted paperwork on Friday with U.S. regulators for an initial public offering (IPO) in New York, according to people familiar with the matter. While terms of the IPO have not yet been set, the Boston-based company is mulling a raise of at least US$750 million in the listing, one of the sources said. Klaviyo was valued at about US$9.5 billion in its last financing round in 2021. The Wall Street Journal had reported in April that Klaviyo was preparing for an IPO. With the IPO registration, Klaviyo becomes the second high-profile name in recent weeks to press ahead with an offering, even as stock market volatility and economic uncertainty has put many other IPO hopefuls off. SoftBank Group Corp’s Arm Ltd filed confidentially for its stock market listing in April, Reuters reported. Arm is hoping to raise as much as US$10 billion from the IPO, which is expected to be the biggest of the year. https://reut.rs/42Mle8c

Jack Ma-backed Ant weighs introducing investor in HK bank unit.

Ant Group Co. is considering selling a stake in its virtual banking unit in Hong Kong, according to people familiar with the matter, the latest move as the fintech giant overhauls operations. Ant Bank (Hong Kong) Ltd. has been talking to potential investors to bolster operations, the people said, requesting not to be identified because the matter is private. The plan is preliminary and subject to change, said the people. Ant declined to comment in an emailed statement. Ant Bank is one of eight virtual lenders approved by the Hong Kong Monetary Authority in recent years, competing with rivals including Za Bank Ltd. and WeLab Bank Ltd. In China, its parent Ant Group has been restructuring operations across the board to appease regulatory demands after its initial public offering was halted in 2020. Ant Bank recorded about HK$232 million (US$30 million) in losses for 2021, according to its annual report. It had HK$545,000 of loans outstanding as of December that year, while deposits totaled HK$741 million. https://bloom.bg/3nV0XP6

Alibaba logistics arm eyes up to US$2 billion Hong Kong IPO.

Alibaba’s logistics arm aims to raise up to US$2 billion via a listing in Hong Kong likely early next year, sources with knowledge of the matter said, bolstering hopes for a capital markets revival in the Asian financial hub. Cainiao, which has started work on the IPO, is looking to raise between US$1 billion and $2 billion in Hong Kong, according to three sources. They declined to be named because the listing deliberations are private. The planned IPO, the size of which has not been reported before, is likely to be launched in early 2024, two of the sources said. It co-founded Cainiao in 2013 with partners including department store owner Intime Group, conglomerate Fosun Group and a handful of logistic firms. Alibaba took control of Cainiao four years later and has lifted its stake to 67% from 47%. Cainiao, which provides software and shares data with warehouses, carriers and logistics firms, reported 42 billion yuan (US$6.07 billion) in revenue in the nine months ended December, up 22% year-on-year and accounting for 6% of Alibaba’s total revenue. About US$1.5 billion has been raised from IPOs in Hong Kong so far this year, marginally above the US$1.2 billion raised in the same period last year, according to Refinitiv data. https://bit.ly/3HVHogv

Chinese chipmaker plans listing after clearing US export controls.

A leading Chinese chipmaker is going ahead with a listing in Shanghai that will fund major expansion, after receiving confirmation from US chip toolmakers that they can supply its new production lines. After months of uncertainty, ChangXin Memory Technologies has been told the chipmaking equipment it needs will not be subject to US export controls, according to three people with direct knowledge of the matter. CXMT was founded seven years ago and is one of China’s biggest DRam memory-chip makers. It is also the only one capable of producing them at a miniaturisation level below 20 billionths of a metre. CXMT plans to use American equipment that can make less sophisticated chips for phones, servers and electric vehicles, bypassing the tightened requirements for exports of advanced chip tools. The company was one of several Chinese chipmakers forced to put expansion plans for fabrication plants on hold after the US introduced its sweeping export controls on October 7 last year. Another larger Chinese memory-chip maker, Yangtze Memory Technologies, has since found workarounds to resume capital spending. Now CXMT, based in the eastern province of Anhui, is stretching its goals for growth in 2023. https://on.ft.com/458Ef74

Qualcomm acquires Autotalks to boost Snapdragon’s automotive safety technology, reportedly for US$350-400 million.

Qualcomm’s longer-term bet on the automotive sector as a lucrative customer base for its chips and related communications technology is getting a significant push: The company announced that it is acquiring Autotalks, a fabless chipmaker out of Israel that builds semiconductor and system-on-a-chip technology to aid in automotive safety; sources tell us Qualcomm is paying between US$350 million and $400 million for the startup. Qualcomm said the plan will be to integrate Autotalks’ V2X (vehicle-to-everything) communication tech into its mobility-focused Snapdragon Digital Chassis portfolio. Qualcomm has picked up some interesting momentum in its automotive business to date, with customers including VW, General Motors, Mercedes-Benz, Cadillac, Honda and Stellantis. In September last year it claimed a US$30 billion “design-win pipeline” in automotive — although that is a longer-term idea more than a solid concept. In more hard numbers, its QCT division (the core CDMA business covering mobile and wireless chips and related tech) saw automotive revenue of US$975 million in FY21, and US$1.3 billion in FY22. https://bit.ly/3I045Ai

PayPal profit rises 56% as expenses kept in check.

PayPal’s revenue grew 9% year-over-year in the first quarter, to US$7 billion. Much of that growth came from users making more payments, as the number of payments per account in the prior 12 months grew 13%, compared to a 1% increase in total active accounts. PayPal’s profit grew 56% during the first quarter, to US$795 million, due in part to lower expenses in areas such as sales and marketing and customer support. The company announced in January that it would lay off 7% of its workforce. PayPal’s free cash flow declined 3%, to US$1 billion, as a result of higher taxes. https://bit.ly/3o0sYVq

Airbnb revenue growth slows to 20%.

Airbnb reported 20% higher revenue in the first quarter, which it credited to a roughly equivalent increase in the number of nights and experiences booked. The increase lifted Airbnb’s free cash flow by 32% to US$1.6 billion. While the travel booking site is now immensely profitable and cash rich—it finished the quarter with US$10.6 billion in cash and investments—its growth rate has slowed sharply as the rebound from the post-Covid period dissipates. In the first quarter of last year, for instance, Airbnb’s revenue grew 70%, although growth had slowed to 24% by the fourth quarter. Airbnb projected second quarter revenue growth would slow to between 12% and 16%, which likely contributed to the stock’s 11.25% drop in after-hours trading. https://bit.ly/3nOEIuo

Palantir soars 15% after company reports strong earnings and says demand for its AI tool is ‘without precedent’.

Palantir stock jumped 15% Tuesday to US$8.89, the highest price since mid-February, after the software company touted strong demand for its AI tools. The stock already this year had been up 20%, among a number of tech stocks that have benefited from AI prospects on the back of the viral popularity of ChatGPT from OpenAI. Palantir, whose co-founders include billionaire tech investor Peter Thiel, posted first-quarter adjusted earnings of US$0.05 cents a share, topping expectations of US$0.04 a share. It also logged a net profit of US$0.01 a share. Revenue rose 18% to US$525 million, exceeding expectations of US$505.8 million. https://bit.ly/42w2NoK

Berkshire Hathaway cuts stake in EV maker BYD as Warren Buffett and Charlie Munger say they don’t want to compete against Elon Musk.

Berkshire Hathaway reduced its stake in Chinese electric vehicle maker BYD last week for the 11th time in less than a year. The share sale came just days before Warren Buffett and Charlie Munger said they don’t want to compete with Elon Musk. Berkshire sold nearly 2 million shares and now owns just under 10% of BYD, which rivals Tesla as the world’s largest EV manufacturer. Berkshire’s current BYD stake is worth just over US$3 billion. “We don’t want to compete with Elon in a lot of things,” Buffett said on Saturday. Munger quickly added on to Buffett’s comment, “We don’t want that much failure.” https://bit.ly/3BjEUVB

EV maker Rivian narrows losses in Q1, beats on revenue.

Rivian may still be burning through cash, but it has managed to narrow losses and generate more revenue as the automaker sells more of its EVs while paring down costs. Rivian reported Tuesday US$661 million in revenue in the first quarter, a nearly seven-fold increase from the same period last year when it was plagued by supply constraints and production woes that curbed deliveries. The company’s Q1 revenue was fueled by 7,946 vehicle deliveries compared to the 1,227 vehicles it delivered to customers in the first quarter of 2022. Revenue did dip, however, from the fourth quarter when Rivian generated $663 million from sales. The company also noted that its commercial van production line was down for a significant portion of the quarter as it introduced its Enduro motor and lithium-iron phosphate battery technology into the commercial van production process. Shares of Rivian grew by 5% in after-market trading to US$14.57 as investors responded favorably to the revenue beat. Rivian reported $283 million in capital expenditures, one-third lower than the $418 million it spent in the first quarter of 2022. The company said capital expenditures were higher last year because of equipment and construction expenses at the early stages of its production ramp at its Normal, Illinois factory. https://bit.ly/3Mm5uDF

Tesla recalls virtually every car it has sold in China.

Tesla Inc. recalled virtually every car it’s sold in China due to a braking and acceleration defect that may increase crash and safety risks. The automaker will deploy an over-the-air software fix to more than 1.1 million vehicles produced in Shanghai from January 2019 to April this year, plus some models imported into China, the State Administration for Market Regulation said Friday in a statement. The defect relates to Tesla’s regenerative braking system, which makes use of energy created when drivers take their foot off the accelerator by sending power to the car’s battery. The vehicles haven’t allowed drivers to set the intensity of their regenerative braking and don’t alert drivers when they’ve stepped on the accelerator for a long time, which raises the probability of pedal misapplication, China’s regulator said. https://bloom.bg/3pyVpua

Porsche taps Mobileye for automated driving functions in future models.

Porsche has partnered with Mobileye, the autonomous driving unit that Intel spun out into a public company last year, to bring hands-free automated assistance and navigation functions to future sports cars, the companies said Tuesday. In the upcoming collaboration, Mobileye’s branded SuperVision technology platform will serve as the foundation for advanced driver assistance systems (ADAS) in Porsche’s future vehicles. The partnership comes several months after Porsche’s parent company, Volkswagen, and Ford pulled their investments into autonomous vehicle technology company Argo AI, resulting in the startup’s shutdown. Argo was developing Level 4 autonomous vehicle technology, which would allow the vehicle to handle all aspects of driving in certain conditions without human intervention. The company had already begun partnerships with Lyft to offer public robotaxi services in several cities. Porsche did not say when customers would see Mobileye’s technology on future models, nor which models would feature SuperVision. The company did say other VW Group brands will be able to adopt SuperVision as a platform solution. https://bit.ly/3O65bOD

Shortage of AI servers prompts Microsoft-Oracle negotiations.

Oracle and Microsoft have been discussing a pact to effectively share servers with one another if one company’s cloud runs out of capacity due to demands of artificial intelligence companies such as OpenAI, The Information reported. Servers outfitted with special chips for AI processing have been in high demand, causing long wait times for cloud customers that want them. Separately, Oracle plans to pursue a ‘Switzerland’ approach to cloud AI by offering a multitude of software from AI vendors while also developing its own to sell to cloud customers, the report said. It also has been discussing using OpenAI’s technology for product development. https://bit.ly/3Bl0sRy

Google CEO discloses ‘Gemini’ AI to rival OpenAI’s GPT.

Google CEO Sundar Pichai on Wednesday officially disclosed the existence of Gemini, a large machine-learning model The Information broke news about in March. The model, still in development, is aimed at rivaling OpenAI’s GPT, which powers ChatGPT. Gemini also aims to improve on Google’s PaLM 2 machine-learning model, which powers the company’s ChatGPT rival, Bard, and other conversational AI across Google products. Led by longtime Google engineering leader Jeff Dean, Gemini may end up being one of the biggest and most compute-intensive AI models ever created. At a major Google product event Wednesday, Pichai said Gemini would feature greater “memory and planning” capabilities compared to PaLM 2, though he didn’t elaborate and didn’t announce a release date. https://bit.ly/3pyVxtE

Amazon has a secret new home robot with ChatGPT-like features that understands a lot more of its surroundings.

Amazon is working on an upgraded version of its home robot Astro, powered by ‘Burnham’ technology. The robot has ChatGPT-like features, using large language models and other advanced AI. This is a new phase for Astro and the latest example of Amazon adding AI models to existing products. The company often encourages staff to imagine future press releases for new technology they are developing. In one of these documents related to Burnham, Amazon describes an Astro product that costs US$995. There’s an additional “Burnham Plus” US$24.99 monthly fee for standard home monitoring features, and Burnham Plus with Amazon’s Ring doorbell camera would be US$34.99 a month. https://archive.ph/AJQzE

Metaverse could contribute up to 2.4% of US GDP by 2035, study shows.

The metaverse could contribute as much as US$760 billion or about 2.4% to U.S. annual gross domestic product (GDP) by 2035, according to a study commissioned by Facebook owner Meta Platforms. The concept of the metaverse includes augmented and virtual reality technologies that allow users to immerse themselves in a virtual world or overlay information digitally on images of the real world, according to the report by consulting firm Deloitte. Economic gains may come from the use of the technologies in the defense, medical and manufacturing sectors, plus entertainment use cases such as video games and communication, the report said. In a separate report, Meta said the European Union may see an increased economic opportunity of up to 489 billion euros ($538.29 billion) in annual GDP by 2035 or about 1.3%–2.4% of its total GDP. The metaverse could contribute between C$45.3 billion ($33.88 billion) and C$85.5 billion to Canada’s annual GDP by 2035, Deloitte said. https://reut.rs/3O65mt6

WSJ: Apple’s Reality Pro headset still coming to WWDC, but Apple is ‘anticipating production issues’.

Ahead of WWDC kicking off in less than a month, the Wall Street Journal is out with a new report today corroborating many details of Apple’s “Reality Pro” headset. Citing “people familiar with the matter,” the report echoes that the AR/VR headset will feature a ski goggle-style design, an external battery pack, and more. The report reiterates that Apple’s headset will use a mixed-reality approach, allowing users to “experience their virtual worlds through the screen in the goggles” while simultaneously seeing the “physical world around them thanks to outward facing cameras.” While the headset is still on track to make its debut at WWDC, today’s report points out that it won’t be available “for most users until the fall at the earliest.” Mass production isn’t slated to begin until December, the report says. In the meantime, Apple has “spent months preparing presentations with a demo version of the device” for WWDC in June. Even with mass production still months away, WSJ sources say that people inside Apple and inside the company’s supply chain are worried about further delays. Some Apple employees and suppliers have questioned whether the rollout could be delayed given the challenges with integrating the headset with new software, its production and the broader market, people familiar with the product’s development said. https://bit.ly/41zQvKT

Microsoft bets that a fusion power plant from Helion Energy will be operating this decade.

The timeline for pumping fusion energy into the power grid might be closer than many believed. Microsoft on Wednesday agreed to buy 50 megawatts of electricity — enough to power about 40,000 homes — from a fusion power plant being developed by Helion Energy. The startup’s plant is expected to come online by 2028. Scientists have long been trying to harness fusion energy, with some predicting that it won’t be a viable power source for decades. Researchers had a breakthrough in December, when federal scientists in California reported they achieved the first net energy gain — a fusion reaction that produces more energy than it takes to create. But so far, the lab hasn’t replicated the results, Bloomberg reported. https://bit.ly/3I7ar0I

Nintendo warns of big slowdown in Switch console sales.

Nintendo Co. expects to sell 15 million units of its Switch console this fiscal year, showing the extent of the slowdown for its six-year-old flagship product. The Kyoto-based games maker’s guidance falls shy of an average analyst estimate of 15.7 million units, which has taken into account a deceleration in hardware sales in recent months. The company also forecast operating income of ¥450 billion (US$3.3 billion) this fiscal year, close to the ¥455.3 billion average estimate. https://bit.ly/44SqskX

Fortnite is now an Olympic esport.

Fortnite has been named as a late addition to the International Olympic Committee’s latest stab at esports. Back in March, the IOC announced the Olympic Esports Series, a competition set to feature nine virtual sports, represented by a range of video games such as Just Dance and Gran Turismo. Fortnite will also now be included, as part of a 10th discipline: “sport shooting”. The whole thing will also be part of a crossover in Fortnite (because of course), with a specially-designed island in Fortnite designed to promote the Olympics’ Esports event. The news marks a U-turn by the IOC, which previously said that so-called “killer games” would never be featured. https://bit.ly/41owwi8

Disney+ and Hulu content to combine into one streaming app.

In a significant move made by Disney, the company announced Wednesday that U.S. customers are getting a new app that combines Disney+ and Hulu content. The company also announced that it is raising the price of the Disney+ ad-free tier later in the year. During Disney’s quarterly earnings call, CEO Bob Iger revealed that the new streaming option will launch at the end of 2023. However, the company also plans to keep Disney+, Hulu and ESPN+ as standalone platforms. The offering, at first, will be available for subscribers with the Disney Bundle (Disney+ and Hulu). So, instead of having to switch back and forth from each service, users will have a “one app experience,” Iger said during the call. The news comes after Disney+ lost 4 million subscribers in the second quarter of 2023. Hulu gained 200,000 subs. https://bit.ly/3pD0MZq

Netflix reportedly plans to cut spending by US$300 million this year.

Netflix is planning to cut its spending by US$300 million this year, according to a new report from The Wall Street Journal. The report indicates that part of the reason the streaming giant is looking to cut costs is because it delayed its plans to crack down on password sharing in the U.S. and elsewhere from the first quarter of the year to the second quarter, which means that revenue from the move is now expected to come in toward the second half of the year. It’s worth noting that although Netflix plans to cut costs by US$300 million this year, this number represents a small fraction of the company’s overall expenses. For instance, Netflix’s operating expenses last year were about US$26 billion. https://tcrn.ch/3prlH1h

Amazon Studios forms new film and TV distribution unit.

Amazon plans to make its movies and TV shows, including original programming produced by Amazon Studios, available to rent or buy on other platforms. The company has formed a new business unit, called Amazon MGM Studios Distribution, which will also focus on licensing the company’s programming to TV networks in foreign markets. Amazon is also open to selling Amazon’s original series in syndication or licensing it to traditional cable TV networks or other streaming services. In the past year, entertainment giants including Disney and Warner Bros. Discovery have reversed from earlier decisions to reserve their content exclusively for their own streaming services in an effort to generate more revenue from licensing. Amazon completed its purchase of MGM, which has a library that includes the James Bond and Rocky movie franchises, for US$8.5 billion last year. https://bit.ly/41A4PD4

Meta unveils generative AI tool for advertisers.

Meta Platforms has announced a new generative AI tool for advertisers as the company tries to incorporate more of the buzzy technology into its products. The tool, which Meta has named the “AI Sandbox,” includes features to generate text and background images using AI. The company is currently testing it with a small group of advertisers and plans to roll it out more widely in July, Meta ad executives said at a press event in New York. Meta has been accelerating its work on AI in the months since OpenAI’s ChatGPT catapulted into mainstream popularity. The company views AI as an opportunity to boost short-term advertising revenue. Amazon and Google are also working on developing generative AI tools for advertisers, The Information previously reported. https://bit.ly/3px0m6J

Amazon offers shoppers US$10 to pick up purchases as it targets delivery costs.

Amazon is offering customers US$10 to pick up a purchase rather than have it shipped to a home address, as the e-commerce giant joins other retailers in racing to slash costs for home delivery and returns amid slack consumer demand. Amazon over the last few days has emailed an unknown number of Prime subscribers offering them US$10 to retrieve an order of US$25 or more at company pickup points at locations such as Whole Foods, Amazon Fresh or Kohl’s stores. Amazon separately has started charging some customers a $1 fee if they return packages via a United Parcel Service store when there is an Amazon pickup/return location closer to their delivery address, a change first reported by The Information news site. Shipping companies UPS and FedEx have encouraged customers to use so-called access points, particularly in rural areas where delivering to far-flung addresses can be cost-prohibitive. https://reut.rs/42xxPfY

Binance lifts block on bitcoin withdrawals amid heavy volumes.

Cryptocurrency exchange Binance halted bitcoin withdrawals for several hours on Monday, citing heavy volumes and a surge in processing fees, before clearing them at a higher cost. Late on Sunday and again early on Monday the world’s biggest crypto exchange shut bitcoin withdrawals saying there was a glut of pending transactions because it hadn’t offered so-called miners a high enough reward to log the trades on the blockchain. The halt pushed bitcoin lower though its losses were marginal, with the cryptocurrency last down about 1% to US$28,162, its lowest in nearly a week. In March, Binance had suspended deposits and withdrawals citing tech issues. Twenty-four hour trading volume on Binance was US$6.9 billion according to analytics site CoinMarketCap, more than eight times the next-largest venue, Coinbase. https://bit.ly/42rWFh8

Robinhood faces regulatory probes over communications compliance.

Robinhood Markets Inc. said regulators are investigating the firm’s compliance with recordkeeping requirements, including employees’ use of “off-channel communications.” The firm is cooperating with probes by the enforcement divisions of the Securities and Exchange Commission and Financial Industry Regulatory Authority, Menlo Park, California-based Robinhood said Wednesday in a quarterly filing. The SEC is also looking into whether the brokerage followed rules about trade reporting related to securities lending and fractional share trading, according to the filing. Last year, regulators reached settlements with a group of big banks in a sprawling investigation into how the firms monitored their employees’ communications on unauthorized messaging apps such as WhatsApp. https://bloom.bg/3W26DDz

Global installed PV capacity passes 1.18TW – IEA.

The global cumulative capacity of installed and commissioned PV increased by more than 25% last year thanks to post-Covid price hikes and geo-political strife. It reached about 1.2TW by the end of 2022, while China continued to be the country with the largest installed capacity, according to the Snapshot of Global PV Markets 2023 issued by the International Energy Agency (IEA). Last year, a total of 240GW of new solar PV systems were installed and commissioned worldwide, which resulted in the cumulative capacity reaching 1,185GW. China continued to dominate both new and cumulative capacity, as it added 106GW of capacity last year, or 44% of the global additions, with its cumulative installed capacity reaching 414.5GW. This growth followed that of previous years – 54.9GW in 2021 and 48.2GW in 2020. The US installed only 18.6GW last year, down from 27GW in 2021, under the combined influence of trade issues and grid connection backlogs which reached 1TW of solar projects waiting for interconnection access. https://bit.ly/3pDRTPn

Tesla’s new Texas lithium refinery to support 1M electric vehicles by 2025.

Tesla officially broke ground Monday on a Texas lithium refinery, making it the only U.S. automaker to refine its own lithium. CEO Elon Musk said the refinery will produce enough battery-grade lithium for 1 million electric vehicles by 2025, which would make Tesla the largest processor of lithium in North America. Tesla will continue to rely on existing suppliers like Albermarle and Livent as it aims to reach its 2023 sales goal of around 1.8 million cars globally. Today, the U.S. produces just 1% of the world’s lithium, with Australia, Chile and China leading the way. The Biden administration’s EV tax credit aims to spur more domestic battery material sourcing and production and reduce the U.S.’s reliance on China, which hosts 60% of the world’s lithium refining capacity and nearly 80% of the world’s lithium-ion battery production capacity. During Investor Day, Musk also encouraged other startups to get involved in refining lithium, which he likened to “minting money.” “We’re doing it because we have to, not because we want to,” Musk said previously. Tesla will invest US$375 million to build the facility, according to filings with the Texas Comptroller. https://tcrn.ch/3Me2x75

Silicon Valley Bank’s first loan post-collapse: 100 MW of community solar.

Pivot Energy has announced the closing of a ~US$203 million financing facility to support a multi-state portfolio of distributed generation solar projects. Silicon Valley Bank (SVB), a division of First Citizens Bank, will lead the debt facilities and Foss & Company will make the initial tax equity investment. The 100-MWDC portfolio comprises 35 community solar and C&I projects planned to reach commercial operation (COD) between Q2 2023 and Q2 2024. The financing is Pivot’s second portfolio of projects the company will build, own and operate since its strategic acquisition by ECP in June 2021. The community solar subscribers in this portfolio include commercial clients including municipalities, healthcare facilities, food service and retail; residential customers; and approximately 8,000 low-to-moderate income (LMI) households. This broader portfolio comprises the most extensive LMI community solar portfolio developed to date. It exhibits strategic diversity across project types, client offtake arrangements and geographic reach with projects in Colorado, Minnesota, Illinois, New York, Hawaii, Maryland and California. This geographic and customer diversity is beneficial in bringing clean solar energy to more Americans and strengthening the portfolio’s long-term financial outlook. This transaction is the first syndicated loan closing that SVB has led since the recent acquisition by First Citizens Bank after SVB collapsed. SVB pioneered community solar financing solutions and has remained a preeminent leader in the market. This transaction shows First Citizens Bank’s commitment to continue lending to this vital space. https://bit.ly/44SIZNZ