Popular Searches. Read More . To set a new and better course for the Company, and to give United stockholders the opportunity to elect the Board they deserve, Altimeter has delivered to you a notice today indicating its intention to nominate six highly qualified professionals led by former Continental Airlines CEO Gordon Bethune to the United Board at the 2016 annual stockholder meeting. I have deep respect and admiration for founders that continue to grind, inspire, and invent long after the financial motivation is gone. It did not specify which of Alitmeter's SPACs Grab was in talks with. I have deep respect and admiration for founders that continue to grind, inspire, and invent long after the financial motivation is gone. Hedge Fund Manager. Get your daily dose of business updates on WhatsApp. Meta (Facebook) Begins Biggest Layoffs in Company's History, Meta (META) Connect Conference Key Takeaways, Meta (Facebook) Shares Slammed as Earnings, Spending Disappoint. It's been a big drawdown this year. It's our largest position in the book. Right. And we are confident that your long-term investments in AI and the next generation of communications will continue to drive us all forward. I have been told that Amazon spent far less in total to build AWS. While the increased AI investment was clearly well timed, Metas investment in the metaverse, while smaller than the AI investment, has gotten the most attention and has led to much confusion. Finally, Prudential PLC lifted its . At the end of the second. "Jitesh Ubrani: Tweet From March 3, 2023. It was being purchased on the Shopify platform and people were using PayPal to check out. We worked hard on the deal and the timing was horrific. He joins me live. We had given most of that up by middle of December. Altimeter Capital Management, LLC a Portfolio Activity as reported in the most recent 13F form published on Dec 31, 2022. Meta shares moved 6% higher following the announcement. At first glance, the rules of English capitalization seem simple. It includes reducing headcount expenses by 20% and limiting the company's pricey investments in "metaverse" technology to no more than $5 billion per year. The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs. We didn't think that was durable. Altimeter is focused on technology investment, and has found multi-billion-dollar success. Benchmark Reform and Transition from LIBOR InfoHub, Use of Chinese Government Bonds as Margin, Updated OTC Derivatives Compliance Calendar, ISDA-Clarus RFR Adoption Indicator: January 2023. Days Trial. The conventional wisdom press and investor is that the core business hit a wall last fall. . Barney Harford, former CEO of Orbitz Worldwide; former board member of Orbitz Worldwide and eLong; 15 I think that this is a business that is investing in the right things. We were about 30% to 40% depending upon which basket you looked at software internet above the five-year average. This is a region of 700 million plus people. Drew Angerer | Getty Images News | Getty Images, Meta needs to focus on its core business, not the Metaverse, says Sand Hill's Brenda Vingiello. A newly launched P2E adventure game, Chronos: Dawn of Tie, has introduced a series of brand-new PvP elimination tournaments.Last month, the whimsical battle game organized its beta stage featuring selected players. I mean you have defended it at every turn from the issues that the company has had you you defended Mark Zuckerberg, you've defended Sheryl Sandberg and you you did it quite loudly on this program. 2,06,700 crore) a year and capped annual investment in the metaverse to $5 billion (roughly Rs . Login Reels, which is a massive product is going to increase its monetization between now and the end of the year. Can they maintain their growth momentum? Meta didn't immediately respond to a request for comment. GERSTNER: No, I didn't leave it out. UPDATE: Altimeter Capital, PAR Capital Issue Letter to United Continental Board - United Airlines Holdings (NASDAQ:UAL) - Benzinga SPY 397.68 0.74% QQQ 293.61 0.83% BTC/USD 22299.46 5.109%. 41,300 crore) to $25 billion (roughly Rs. Instead, the company has announced investments of $1015B per year into a metaverse project that largely includes AR / VR / immersive 3D / Horizon World and that it may take 10 years to yield results. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. Right if the Fed raises rates 10 or 12 times given the demand destruction and the slowdown already underway in this country, we will be in a big recession come fall. United has a Clear Record of Sustained and Substantial Underperformance: Despite premier, industry-leading strategic assets such as significant scale advantages, strong brand recognition, hubs in key business markets, and membership in the largest global airline alliance United has been the worst-performing U.S. airline stock over the last five years. "Meta needs to re-build confidence with investors, employees and the tech community in order to attract, inspire, and retain the best people in the world," Gerstner wrote in the letter. You know how to time markets. Moreover, I am a strong supporter of founder-led companies especially when they have your successful track record of seeing the future. This is a company that only did 1.2 billion in revenue last year. All quotes delayed a minimum of 15 minutes. If the deal goes through, it. But listen, there's massive uncertainty in the world. The firm's private equity arm makes all-stage venture capital investments, primarily in the technology sector. Despite public skepticism at times warranted we have been supporters of the companys strategy to continuously reinvest in a product-led future and its mission to make the world more open and connected. We know they have high EBITDA margins on the rideshare business which is dominant across the region. Ranked #76 out of 483 Hedge Fund Managers. As such, we think Meta company should cap its metaverse investments to no more than $5B per year with more discrete targets and measures of success, as opposed to todays much more ambitious and open-ended strategy. Ultimately, we and the Board necessarily must share the same objective: maximizing long-term value creation for United's stockholders, customers, and employees. Today, the cost of capital has radically changed, and so has Metas growth rate. . Some companies require tremendous capex investment to maintain their existing business. I don't think stocks today reflect a great price discovery about where these stocks are going to be in six months, let alone two years, but I'm also eyes wide open to the fact that we could go lower before we go higher. So, its with some hesitation, but significant conviction, I am sharing an open letter strongly encouraging Meta to streamline and focus its path forward. Copyright 2023 Bennett, Coleman & Co. Ltd. All rights reserved. With that said, we have a shortage of talent in Silicon Valley. Altimeter Capital's Brad Gerstner Issues Open Letter to Meta (NASDAQ: META) and Mark Zuckerberg. In fact, our internet stock index is at a 10-year low and software is back nearly where we were in 2016 before the rerating of software occurred. This will alert our moderators to take action. Altimeter Capital owns about 2.46 million Meta shares. See here for a complete list of exchanges and delays. Investopedia requires writers to use primary sources to support their work. Grab Holdings is reportedly in talks to go public through a merger with a "blank check" company that could value the Southeast Asian ride-hailing startup at as much as . With SNOW currently trading at $242, that stake is now worth $8.8 billion. Based on yesterday's announcement, it seems the Board now agrees that for many years it operated with a suboptimal composition. Bill McColl has 25+ years of experience as a senior producer and writer for TV, radio, and digital media leading teams of anchors, reporters, and editors in creating news broadcasts, covering some of the most notable news stories of the time. We were wrong. Worse, this skepticism seemed to be affirmed with a nearly-immediate and sizable miss in financial results and continued under-performance throughout 2022. Bruce Berkowitz's: Fairholme Capital Management. This heavy equipment maker is a good buy on dips stock; heres why, Tears from smokeless cooking gas as consumers continue to bear price hikes on top of subsidy cuts. And we've had government intervention of the magnitude. We didn't see the concerns emerging about hyperinflation about 10 to 12 rate hikes, and we certainly didn't see this tragic more unfolding on the doorstep of Europe. Where's your exposure today? After all, why not hire more people and invest in more things when the cost of capital was near zero and growth seemed unlimited? We know Meta has more reach, more relevance, and more incredible opportunities for growth than almost any platform on the planet. You would simply do R&D quietly and investors would focus on the core business and the breakthroughs in AI. About Altimeter Capital Altimeter is a global investment firm managing both public and private funds focused on the airline, travel, technology, internet, software, and consumer sectors. This is a business it's trading at 12 times free cash flow, X the meta investment and 18 times including. Days Trial Altimeter Growth Corp., the blank-check company merging with internet giant Grab Holdings Inc., is hovering just a few cents above its record low after cratering 28% since the deal was unveiled in . Skip to main content. About Altimeter Capital The facts are startling. As such, we would encourage the company to move aggressively and cut at least 20% of employee-related expenses by January 1, 2023. But admittedly, you know, nights like tonight we'll we'll get we'll catch a little less sleep. GERSTNER: Right, it comes down fundamentally to a question Scott of whether you think we're gonna have more than eight rate increases or less. 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It takes effect in 2023. Altimeter Capital Management LLC. FalconX Raises $210M Following 30x YoY Revenue Growth; Now Valued at $3.75 Billion Series C Led by Altimeter Capital, B Capital Group, Sapphire Ventures, and Tiger Global Management, with. This lack of focus and fitness is obscured when growth is easy but deadly when growth slows and technology changes. We want to hear from you. Meta. They were buying goods, soccer balls on DICK's Sporting Goods and candles on Williams Sonoma. Following is the unofficial transcript of a CNBC exclusive interview with Altimeter Capital Founder & CEO Brad Gerstner on CNBC's "Closing Bell: Overtime" (M-F, 4PM-5PM ET) today, Monday, March 14th for the premiere. Metas core business is one of the largest and most profitable in the world with over $45 B in operating profits last year alone. We are generally patient investors. As you know, we are long-term shareholders. With Snowflake, the question as to whether or not that business is going to compound, I think is not one that many people will debate. WAPNER: I want to take a look at the stock in "Overtime" here because I think you're moving in I'm looking at what looks to be a higher move as we're having this conversation and that brings me frankly, now to Facebook. 2023 CNBC LLC. And I think they have to execute against the underlying operations in the business. Facebook's revenues in Q1 were lower than people expected. WAPNER: Okay, that's a that's a big a bold call. As always, happy to connect with you and your team. I mean, two years ago we were we were having this conversation. c/o Chairman Henry L. Meyer III You can learn more about the standards we follow in producing accurate, unbiased content in our. Cookies collect information about your preferences and your devices and are used to make the site work as you expect it to, to understand how you interact with the site, and to show advertisements that are targeted to your interests. At Meta, the number of employees is up over 3x from 25k to 85k employees in just the last four years! Right? But the fact of the matter is the entire market has evaporated around these types of stocks. Social networking is the use of internet-based social media platforms to make connections and share various media with friends, family, colleagues, or customers. If they just take the incremental cash they're going to generate this year and buy back shares that's 6% of the company Scott, let alone the 50 billion in cash they have sitting on the balance sheet. Bill Ackman's: Pershing Square Capital Management. effective risk management for all users of derivative products. And Meta certainly has abundant financial resources to invest and / or return to shareholders. Or it's well over a trillion, Microsoft 3 trillion. I have been told that Amazon spent far less in total to build AWS. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. But what is the right amount? An estimated $100B+ investment in an unknown future is super-sized and terrifying, even by Silicon Valley standards. If Meta was able to control those costs, he said, then it could double its free cash flow and improve its share price. Altimeter Capital launched its two SPACs in October and January, raising a combined $850 million between the two blank-check vehicles. And so, for our LPs, the bet is simple. We'll see you soon. We have little doubt investors and others would happily support scaling up these investments as the ROI becomes more tangible even if still long-term. And I appreciate you being with me on the very first "Overtime" show. In fact, we believe that augmented and artificial intelligence has the potential to drive more economic productivity than the internet itself. Perhaps it was the re-naming of the company to Meta that caused the world to conclude that you were spending 100% of your time on Reality Labs instead of AI or the core business. The silver lining is that unlike many companies, this popular narrative obscures the truth. Those three companies are all down that amount because it turns out that this year people got off their couch, they went out and they went to restaurants and they went in and did things instead of buy things. And so for us, it's about simplification, reduction of gross and making sure that you consolidate that what you own into your highest conviction ideas whether you're playing at home in your 401k or whether you're doing this professionally. It's down 32% in the last 11 months ,that ranks it in the top three of the last 20 years in terms of drawdowns. Congrats on the new show. It makes no sense to me, but that is the risk that you run. When you visit the site, Dotdash Meredith and its partners may store or retrieve information on your browser, mostly in the form of cookies. Advertisement Gerstner, through Altimeter, manages over $15.0 billion worth of investments across private equity and venture capital. We believe the future lies in AI. The stock today hit a new low under $3. And we are confident that your long-term investments in AI and the next generation of communications will continue to drive us all forward. But the company's dreams have fallen short as the Reality Labs unit, which works on augmented and virtual reality, has continuously reported staggering losses. 9/29/2022 1:05 AM. Worse, this skepticism seemed to be affirmed with a nearly-immediate and sizable miss in financial results and continued under-performance throughout 2022. When exactly did you determine that the Board was so inadequate as to need four new directors, all at once, and without an annual meeting or a stockholder vote? By any normal company or start up standard, $5 B per year would seem like an extraordinary amount. We've destroyed over $15 trillion of stock market wealth. You probably know you should capitalize proper nouns and the first word of every sentence. Rapid mobile adoption helped market leaders blaze through the s-curve with astounding growth rates and a historically low cost of capital made investments in people and things the rational economic decision. Steven Cohen's: Point72 Asset Management. Data is a real-time snapshot *Data is delayed at least 15 minutes. Altimeter LLC. Your P/E ratio has fallen from 23x to 12x and now trades at less than half the average P/E of your peers. Altimeter Capital is in talks with ride-hailing company Grab to bring the company public in a $40 billion deal, according to a report from The Wall Street Journal. An estimated $100B+ investment in an unknown future is super-sized and terrifying, even by Silicon Valley standards. There are a lot of companies with speculative business models, right, that are should have never been valued where they were valued and if you don't have absolute conviction, right, they can grow their product, grow their top line and grow their earnings to match where those earlier prices were, then you need to rotate those dollars out of those companies and into companies where you have that level of conviction. Altimeter Capital Management, LP The Meta investor recommends a plan to get the company's "mojo back.". Unlock your 30 days free access to ETPrime now. Meta needs to regain the confidence of investors, the public and employees, Altimeter Capital Management CEO Brad Gerstner said Monday in an open letterto Zuckerberg. But far from being a bad decision, we think the recommendations outlined above will lead to a leaner, more productive, and more focused company a company that regains its confidence and momentum. And what is going to be the resolution to the situation in the Ukraine? . What am I supposed to think about that? So, it doesn't surprise me at all that buyers are on the sidelines and that sellers and short sellers are having a field day with stocks. Brad Gerstner's Altimeter Capital Management has between $300 million and $400 million in assets under management, and invests almost exclusively in the services sector. Like many other companies in a zero rate world Meta has drifted into the land of excess too many people, too many ideas, too little urgency. It's going to do 20 billion in GMV. Credit Derivatives Determinations Committees, how to enable In the back half, you've already lapped IDFA, in the back half of this year, the supply chain issues begin to ameliorate. Investors in the round: 776 Capital, Altimeter Capital, BoxGroup, Dragoneer Investment Group, FirstMark, General Catalyst, Radcliff Group, ShawSpring Partners, SignalFire, The Baupost Group, Torch Capital, TQ Ventures Data is a real-time snapshot *Data is delayed at least 15 minutes. Board of Directors Altimeter is based in California and has about $16 billion in . Is it done? In addition, people are confused by what the metaverse even means. To put that in perspective, it merely takes the company back to mid-2021 levels of employee expense and I dont think anybody would argue that Meta wasnt sufficiently staffed in 2021 to tackle a business that looks similar to how it looks today. I think you're gonna see monetization gains against IDFA and either way we lap that issue in Q3 and Q4. They're fearful about the war. Meta changed its company name from Facebook. $6.9 M. We believe that our conclusion is shared by many of United's long-suffering stockholders, customers, and 80,000+ dedicated employees. But Meta needs to get its mojo back. Our Standards: The Thomson Reuters Trust Principles. Our best guess is that maintenance capex for Meta is less than $10B annually. We know Meta has more reach, more relevance, and more incredible opportunities for growth than almost any platform on the planet. I don't think there's any chance that the Fed is going to raise rates 10 times this year. Altimeter Capital. There isnt a day that goes by where I dont find myself using Metas products to communicate, to connect, and to entertain still amazed at the power of these services. Today, the cost of capital has radically changed, and so has Metas growth rate. This compensation may impact how and where listings appear. What is the connection between those three companies. As you know, Altimeter Capital Management and PAR Capital Management are long-term United Continental Holdings, Inc. ("United") stockholders that together own approximately 7.1% of United's outstanding common stock. Altimeter Capital owns a stake of about $320 million, according to the Wall Street Journal, but that only equates with a 0.1% share of the company, according to Meta's latest filings with the. Every company I talked to is tightening its belts. If you click the "Accept" button, you consent to the use of cookies on our website. Altimeter Capital Management is a hedge fund with 17 clients and discretionary assets under management (AUM) of $17,950,309,162 (Form ADV from 2022-05-27). He said a 20% cut in employee spending would take Meta back to the levels of staffing it had last year and argued that the company can't spend as it used to since the cost of capital and interest rates have risen recently. My bet is we're gonna have less this year. Our contact information, solely for purposes of this Adherence Letter (and unrelated to the Questionnaire delivery options in the subsequent section) is: We consent to the publication of a conformed copy of this letter by ISDA and to the disclosure by ISDA of the contents of this letter. Market Research. In the last 18 months, Meta stock is down 55% (compared to an average of 19% for its big-tech peers). Get this delivered to your inbox, and more info about our products and services. Altimeter said annual free cash flow can be doubled to $40 billion (roughly Rs. They just announced that they're going to be profit, full company profitable by 2023. It's 3 trillion, right? Enjoy a 7-Day Free Trial Thru Feb 17, 2023! There isnt a day that goes by where I dont find myself using Metas products to communicate, to connect, and to entertain still amazed at the power of these services. Dave Baszucki of Roblox describes the metaverse as the natural evolution of communication a multi-device world, including the phone, that is best thought of as a better version of text, video, and voice that will make us feel more connected. Can it possibly be worth a trillion? The answer to that is because people are very fearful. He argued that this was "one of the big reasons behind these price cuts.". GERSTNER: So, Scott that you know the top six names in our book are all companies that we believe are, you know, both accelerating, expanding margins, expanding free cash flow margins, right, and that are critically important and will be worth more in the future. Adani Group on Thursday said US-based boutique investment firm GQG Partners has picked up equity stakes worth $1.87 billion (15,446 crore) in four listed group companies Adani Ports and Special Economic Zone, Adani Green Energy, Adani Transmission and flagship Adani Enterprises via secondary share sales. As always, happy to connect with you and your team. It's been a half century since Australia and China established formal relations, but neither side is really celebrating. 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