I would take it a step further and argue that these incredible companies would run even better and more efficiently without the layers and lethargy that comes with this extreme rate of employee expansion. But the fact of the matter is the entire market has evaporated around these types of stocks. If the company were investing $12B per year into this project, then that confusion might not even be a problem. Your P/E ratio has fallen from 23x to 12x and now trades at less than half the average P/E of your peers. I've got some people including a guy coming up in a little while Mike Wilson who suggested at this point bonds may be a better deal than stocks. 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. Altimeter Capital Management, ISDA 2021 SBS Top-Up Protocol - Adherence. Altimeter Capital Management LLC. I don't think Mark did a particularly good job of explaining the meta investments. Altimeter Capital owns about 2.46 million Meta shares. This company is perfectly positioned to capitalize on that they have the, the ad network to monetize it. US Jobs Report and Powell Testimony Take Center Stage: Eco Week, Bond Mavens Favor Curve Wagers for Next Encounter With Jobs Data, Bank of Canada Risks Falling Too Far Behind Fed, Scotia Says, Feds Daly Says More Rate Hikes Likely Needed to Cool Inflation, Colombia Prices Rise Less than Forecast to a Fresh 24-Year High, Shortage ofMetals for EVs Is Rising Up the Agenda in Automakers C-Suites, Italys CDP, Macquarie Said Set to Make Telecom Italia Grid Offer, In Blacklisting Inspur, US Targets Partner Used by Intel and IBM, Twitter Revenue, Earnings Fell About 40% in December, WSJ Says, China E-Commerce Giant JD Set for $1.4 Billion Discount Spree, Bolsonaro Says Mission Isnt Over as US Conservatives Fete Him, Biden Closes In on Order to Restrict US Investment in China Tech, Harrods Shrugs Off Recession Fears as Rich Get Richer, FT Says, Wealthy NYC Family Feuds Over $258 Million Madison Avenue Sale, Porsche, Ferrari E-Fuel Push at Heart of EU Engine Debate, Tom Sizemore, 'Saving Private Ryan' Actor, Dies at 61. 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. FREE Breaking News Alerts from StreetInsider.com! Altimeter Capital Management is a technology focused investment firm based in Menlo Park, CA and Boston, MA. All quotes delayed a minimum of 15 minutes. In the last 18 months, Meta stock is down 55% (compared to an average of 19% for its big-tech peers). We hereby appoint ISDA as our agent for the limited purposes of the Protocol Agreement and accordingly we waive, and hereby release ISDA from, any rights, claims, actions or causes of action whatsoever (whether in contract, tort or otherwise) arising out of or in any way relating to this Adherence Letter or our adherence to the Protocol Agreement or any actions contemplated as being required by ISDA. To read full story, subscribe to ET Prime, Billed annually at PAR Capital Management, Inc. Do Not Sell My Personal Data/Privacy Policy. Samooha launches with tech that lets companies securely share data Worse, this skepticism seemed to be affirmed with a nearly-immediate and sizable miss in financial results and continued under-performance throughout 2022. International Swaps and Derivatives Association. The cumulative benefit of the recommended adjustments outlined above would increase FCF by at least $20B in 2023 ($10B from people-related expense reduction, $5B from capex reduction, and $5B from reduced metaverse spend). Stock Radar: 19% from Budget Day! Capitalizing on the fund's VC success, Gerstner raised $450M for Altimeter Growth Corp (AGCUU), a blank check company IPO targeting the tech sector. Brad Gerstner "Bloomberg Opinion" columnists offer their opinions on issues in the news. Meta stock is down over 61% in 2022. Altimeter Growth Corp. 2 raised $400 million in a January IPO. Grab to list in US via $40 bln merger with Altimeter Growth Southeast Asia's Grab in talks for U.S. listing via $40 billion SPAC . Investopedia does not include all offers available in the marketplace. +Includes DocuBay and TimesPrime Membership. 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. 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. WAPNER: Let me lastly ask you about Grab, the SPAC deal you did, biggest SPAC deal ever of $40 billion. Steven Cohen's: Point72 Asset Management. I said IDFA which is the Apple changes right? Amazon Is Closing Its Cashierless Stores in NYC, San Francisco and Seattle, Amazon Pauses Construction on Second Headquarters in Virginia as It Cuts Jobs, Stock Traders Are Ignoring Blaring Bond Alarms, iPhone Maker Plans $700 Million India Plant in Shift From China, Russia Is Getting Around Sanctions to Secure Supply of Key Chips for War. It makes no sense to me, but that is the risk that you run. Includes DocuBay and TimesPrime Membership. It lost $5.8 billion in the first six months of the year. 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. 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. But I am confident these companies like Snowflake, like Uber, like Facebook are going to be worth more than they are today at significantly more if you look out two years. Rodney O'Neal, former CEO of Delphi Automotive; former board member of Delphi Automotive, Sprint, and Goodyear; What am I supposed to think about that? Wall Street closes sharply higher, notches weekly gains as Treasury yields ease, Morgan Stanley reaffirms Top Pick on Apple (AAPL) stock, sees catalyst-rich event path, Amazon (AMZN) pausing construction on second HQ in Virginia - Bloomberg, Broadcom Q1 results & guidance beat estimates; analysts praise 'stellar' execution, Dell reverses early gains on soft outlook; analyst reactions mixed, Embark Trucks (EMBK) to reduce workforce, explore strategic alternatives including liquidation, Ford Motor (F) Declares $0.65 Special Dividend; 4.5% Yield, Crypto firms behind Tether used falsified documents to maintain banking system access - WSJ, Altamira Therapeutics (CYTO) Reports Study Showing Bentrio's Superior Nasal Residence Time and Rheological Properties, Desktop Metal (DM) jumps on chatter of deal with Apple, Midday movers: C3 AI, Costco, Zscaler and more, Dell, Zscaler, ChargePoint fall premarket; Tesla, Hewlett Packard rise, After-hours stock movers: C3.ai jumps on results, Zscaler falls, Macy's, Salesforce and Okta rise premarket; Silvergate, Tesla fall, After-hours movers: Salesforce surges on beat, Silvergate falls on 'going concern' warning. GERSTNER: Without a doubt the single biggest lever on growth multiples is rates. The industry leader for online information for tax, accounting and finance professionals. Now that's what's going on in the business so all those people writing rest in peace epitaphs for Facebook are going to have to deal with that acceleration. GERSTNER: So let's talk for a second about what I called. 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. Those decisions include slashing expenditure and reducing headcount, the CEO of Altimeter Capital told Meta founder Mark Zuckerberg in an open letter. Moreover, Meta has industry leading capabilities in key future technologies like artificial intelligence and immersive 3d that will help drive new products and future growth. All Rights Reserved. The stock today hit a new low under $3. Meta changed its company name from Facebook to better focus on its VR hardware and software and is spending $10 billion per year on the technology. The silver lining is that unlike many companies, this popular narrative obscures the truth. Tina Sharkey, CEO of SherpaFoundry; former board member of HomeAway; and Of course, a company that connects nearly three billion users on phone and text must be investing in the next generation of communication. I hear you but look, there are, there are some people who think and it's not maybe it's not a Snowflake, but it's a you know, a basket of these kinds of names that may never get back. So the way companies have to get there is by growing their top line and growing their bottom line, the answer as to all companies many most certainly will not. Search ISDA ISDA fosters safe and efficient derivatives markets to facilitate effective risk . We want to hear from you. And, while most companies will struggle to monetize AI, we believe Meta is incredibly well positioned to leverage AI to make all of its existing products better. With that said, we have a shortage of talent in Silicon Valley. We are confident that these employees will find replacement jobs and quickly be back to work on important inventions that will move us all forward. As you know, we are long-term shareholders. Altimeter Capital - Portfolio - Index TEORIA ECONOMICA Y SOCIOPOLITICA DESCRIPTORES MNIMOS.pdf Meta says India most significant country for all new things across its platforms, Meta to cut its headcount expenditure by 20%, Hindenburg-triggered Adani Stock Plunge: SC Names Panel to Review Investor Protection Norms, Insurers Eye Bigger Marine Pool for Russia Shipments, ETtech Explainer: Whats behind Sebis crackdown on YouTube influencers for stock market manipulation, A correction good for IT companies, staff: Nasscom chairperson, Infosys cofounder Narayana Murthy says VCs responsible for current growth culture in startups, Caution, conservative client outlook behind Capgeminis muted guidance: CEO Ashwin Yardi, Parliamentary standing committee has approved data protection bill: Ashwini Vaishnaw, Assembly Elections 2023 Results Highlights, India Post Payment Bank Post Office Savings Bank All India Single Ifsc Delhi Delhi IPOS0000DOP, Dragons Prying Eye In The Sky Why Balloon Gate Should Be On Top Of Indias List Of Worries, How Banks Ceded The Upi Space And Control To Phonepe And Google Pay, Macquaries Double Upgrade Has Sparked Some Interest In Paytm Stock Should You Buy, Amazons Aim To Rule Air Cargo Just Got Wings In India Why This Is Only The Start Of A Long Haul, Why A Minority Investor Wants To Stall The Long Pending Indiabulls Real Estate Embassy Group Merger, In 4 Stories Cognizants Tumultuous Journey, Future Locked In A Crypt Understanding The Crackdown On Crypto Amid A Hope For A Global Framework, 5 Weekend Must Reads Featuring India Taking On The Us In Automobile Reliability, The Worlds Most Important Box In 3 Stories, Silent Epidemic The Health Catastrophe India Is Not Talking About And Why That Should Change, Budget 2023 Tweaked The New Income Tax Slabs, Sensex Surges Over 200 Points Nifty50 Above 10350, Why Boycott Germany Is Trending Here Is All You Need To Know, New Zealand Earthquake Of Magnitude 6 1 Hits Northwest Of Wellington Amidst Cyclone Gabrielle, Now Reach Delhi To Jaipur Within 2 3 Hours Courtesy Delhi Mumbai Expressway, Chatgpt Vs Google Bard How Do These Two Ai Chatbots Stack Up Against Each Other, Air India Boeing Deal Us President Biden Speaks With Pm Modi After Landmark Agreement Of 220 Aircraft, Khalistani Separatist Amritpal Singh Gives Ultimatum To Punjab Govt Cancel Fir In An Hour Or Else, Russia Ukraine War Ukrainian Soldiers Call For More Western Weapons, Explained Us New Move On H1b And L1 Visas, Statestreet Hcl Services India Private Limited, Nclat Upheld Adani Power Bid For Korba West Power Asks Shapoorji Pallonji Co To Pursue Arbitration For Claims, Manish Sisodias Arrest Read How The Delhi Liquor Scam Unfolded, We Aspire To Become A 100 Billion Company By 2030 Deepinder Goyal, Dot Nod Soon For Vodafone Ideas Payment Plan, Rhyme Reason India Is Said To Be A Bright Spot In The Global Economy For Nothing, Adani Stocks Market Cap Slips Below Rs 7 Lakh Crore Mark In Non Stop Selloff, Ipo Drought To End In March With Nine Companies Seeking To Raise Over Rs 17000 Crore, Adani Green Among 9 Companies To See Sharp Rise In Promoter Pledge Last 1 Year, Hiranandani Group Leases 21000 Sq Ft In Thane Township To Multiplex Chain Inox, Why Passive Vaping Can Be A Health Scare For The Smoker And Those Around Him, Us Cuts Visa Delays In India Vows To Do More, Adani To Supply Power To Bangladesh In Reduced Price Report, Pinebridge Looks Past Adani Saga To Load Up On Stocks In India, Drone Wars Cartelisation Complaints Reach Defence Ministry On Armys Bulk Uav Purchase Plans, Indigo Offers Flight Tickets From Rs 2093 2023 For Travel Between March To October. And Meta certainly has abundant financial resources to invest and / or return to shareholders. An estimated $100B+ investment in an unknown future is super-sized and terrifying, even by Silicon Valley standards. 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. After several years of growing tensions, the potential for a reset under Australia's new Labor government is in question as trade sanctions remain and diplomatic disputes persist. "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. Where's your exposure today? Focusing the Metaverse: the Next Generation of Communication and Collaboration. Experience Your Economic Times Newspaper, The Digital Way! At the end of the second quarter this year, Altimeter Capital held more than 2 million shares of Meta. b***@altimeter.com. In short, Meta needs to get fit and focused. It added that VR is "a powerful social platform and creative technology, and the more people with access to it, the better. You know how to time markets. "In addition, people are confused by what the metaverse even means," Gerstner wrote. This would double annual FCF and put FCF as a percentage of revenue more in line with Google, Microsoft, and Apple. c/o Chairman Henry L. Meyer III 3,30,700 crore) if it cut headcount by at least 20 percent, trimmed capital expenditure by at least $5 billion (roughly Rs. Altimeter Partner Chris Conforti to Leave the Investment Firm In an open letter to CEO Mark Zuckerberg on Monday, shareholder Altimeter Capital Management urged Meta Platforms Inc., the parent company of Facebook, to streamline by eliminating positions and capital expenditures. If the company were investing $12B per year into this project, then that confusion might not even be a problem. 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. GERSTNER: No, I didn't leave it out. Meta stock is down over 61% in 2022. Grab to list in US via $40 bln merger with Altimeter Growth Meta layoffs 2022: Cut workforce, spending on metaverse, key investor Kultura Capital Management is being structured as a hybrid fund that will focus on late-stage tech startups as well as public companies, the person said. According to Hedge Follow, it was authored by Brad Gerstner, CEO and founder of technology investment firm Altimeter Capital. 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. Conclusion A Leaner, Faster, More Successful Meta. It's a better version of Zoom. FTX founder Sam Bankman-Fried was not only a tireless fundraiser from venture capital firms including Paradigm and Sequoia Capital, but also quietly made investments in those same funds, according to two people familiar with the matter. If you really think about what the metaverse is in the first instance, it's a better version of what you and I are doing right here. Updated on September 30, 2022. See here for a complete list of exchanges and delays. The purpose of this letter is to confirm our adherence as a Protocol Participant to the ISDA 2021 SBS Top-Up Protocol Agreement as published by the International Swaps and Derivatives Association, Inc. on February 25, 2021 (the Protocol Agreement). As always, happy to connect with you and your team. Open letter: Altimeter Capital founder and CEO Brad Gerstner encourages Meta to cut capex by $5B+, cut headcount by 20%+, and limit metaverse R&D to $5B/year As you know, we are long-term shareholders. Kevin Wang - Forbes No matter how a company came public in 2021, let alone December of 2021, right, they've been obliterated. Can it possibly be worth 100 billion? Skip to main content. Altimeter said annual free cash flow can be doubled to $40 billion if it cut headcount by at least 20%, trimmed capital expenditure by at least $5 billion to $25 billion a year and capped annual investment in the metaverse to $5 billion instead of the current $10 billion.