[The beef 675]
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"Whatever happened to Tidal?" - everyone
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Hey there carnivores,
Markets were up on Wednesday after coronavirus fears faded.
Today weâre talking Spotify making moves.
Keep raging,
Jeff & Jason
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Spend money to make money
Spotify released its Q4 earnings on Wednesday, and investors werenât mad, just disappointed. And likely a little mad. While the Swedish streamer saw growth in its subscriber base, it also [lost $1.26 per share]( compared to a 16 cent loss prediction from analysts.
Shuffle playlist
In Q4, Spotify surpassed analyst expectations by signing on 11M premium users, bringing its total to 124M, or 2M more than the big brains on Wall Street were expecting.
Although the subscriber base increased, its revenue per subscriber dropped 5% to 6%. Spotify planned to bring home $2.09B in revenue, but it was forced to face the music with a measly $2.04B, leading [shares down 4.7%](.
Plan P
The earnings call may have left much to be desired for Spotify, but its got a secret weapon in the form of braggadocious basketball writer Bill Simmons. The go-to streamer for love-makinâ playlists also announced it is [acquiring Simmonsâ the Ringer]( podcast network, with terms undisclosed.
The Ringer has 30 podcasts under its belt, including The Unwatchables and the aptly named Bill Simmons Podcast, and itâs doing pretty well for itself. In 2018, the Ringer raked in $15M in revenue, and the company is profitable ... take notes Uber.
Podcasts are the future, if youâre reading this, your grandma is probably recording one from her nursing home as we speak.
The bottom line...
Radio might be dying, but podcasters might be onto something, and so does Spotify. Just last year, the service paid more than $400M to bolster its podcast portfolio, while inking more than 24 deals to create exclusive content, and the acquisition of The Ringer screams âall inâ through noise-canceling headphones.
According to the Swedes, podcasts could be the key to enticing the maniacs that listen to ads in their music over the edge to the premium side of things. Current guidance backs this claim, as Spotify expects to see its monthly active user base land between 279M and 289M this year, with the more important paying customers growing to between 126M and 131M users.
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âï¸ Falling star After an unprecedented rise up stock charts, Tesla [finally ran out of star power](. The company announced that it would be delaying Model 3 production in China thanks to the coronavirus.
The news sent Teslaâs shares down 17%, the second-worst one-day trading session in the companyâs history. Still, Elon Muskâs electric vehicle maker is doing just fine. For now... TSLAâs market cap is $132B, which means Elon is still in line to get a ridiculous bonus payout.
âï¸ Uphill climb Internet-based cycling company Peloton announced [it would be missing]( quarterly revenue when it reports its most recent financials. So thatâs why the girl in the commercial looked so worried. Sales are expected to come in between $470 and $480M, short of the $494M expected. The stock dropped 9% in aftermarket trading.
Itâs been a rough ride for Peloton since it IPOâd late last year. Investors donât seem to think the company can turn a profit, but the company forecasts $1.55B sales in 2020, higher than estimates of $1.49B. Doesnât Peloton realize nobody likes to cycle alone? Spin classes are a thing because you compete with people in a weird dark techno filled room. It's just not the same as home.
âï¸ Weiner pulls out Jeff Weiner [is stepping down]( as CEO of LinkedIn after 11 years as the head of the company, but heâs not going too far. The move comes as part of a restructuring that will move Weiner to the executive chairman position as the Microsoft owned company looks to be getting reigned in on operations.
MSFT bought LinkedIn for $26B in 2016 and it has run somewhat autonomously since then. Ryan Roslansky, the platformâs product leader will be taking over as CEO.
âï¸ Detroit flop city Pour one out for Detroit. It's been a bad week for both Ford and GM after each company announced poor financials in Q4. GM missed sales estimates by 20% and cited the 40-day strike by the United Auto Workers as the main culprit, though the company did top earnings.
Meanwhile, Ford [botched the launch]( of a redesigned Explorer SUV as it lost $1.67B in the quarter thanks to increased pension costs, and general labor hikes in the US.
Both companies put out reports that were ânot greatâ as they say in the finance world. While electric vehicle production is ramping up everywhere else, these two OGs of the auto game appear to be sitting on cinder blocks. They better get in the race before they are stripped down and sold for parts. [Elon cominâ](.
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