Jeff Bezos snubbed eBay in his annual shareholder letter, sending the stock sliding - CNBC

Shares of eBay fell nearly 5% on Thursday, after Amazon CEO Jeff Bezos snubbed the rival e-commerce giant his annual letter to shareholders.

In the letter, Bezos compared the growth in merchandise sales of third-party sellers between Amazon and eBay from 1999 to 2018. His comparison showed that Amazon has clearly outperformed its rival.

"Third-party sales have grown from $0.1 billion to $160 billion — a compound annual growth rate of 52%. To provide an external benchmark, eBay's gross merchandise sales in that period have grown at a compound rate of 20%, from $2.8 billion to $95 billion," said Bezos.

EBay's shares slid to $36.00 on Thursday afternoon. Its market cap was $32.94 billion.

Bezos cited the Fulfillment by Amazon and Prime memberships as the company's two "very best selling tools" to secure Amazon's success with third-party sellers over rivals like eBay.

"We invested in both of these programs at significant financial risk and after much internal debate," Bezos said in the letter. "We could not foresee with certainty what those programs would eventually look like, let alone whether they would succeed, but they were pushed forward with intuition and heart, and nourished with optimism."

In response, eBay CEO Devin Wenig took to Twitter defend the company.

"While I appreciate the ink dedicated to @ ebay from the ceo of the company not focused on competition, think I"ll dedicate my letter to customers, purpose and strategy. We don't compete with our sellers. We don't bundle endless services to create barriers to competition."

eBay CEO tweet

Bezos also challenged rival retailers to match Amazon's minimum wage of $15 per hour. Bezos did not call out competitors by name, but it prompted a response from Walmart's executive vice president of corporate affairs, Dan Bartlett, who challenged Amazon to pay more taxes.

Read Bezos' 2018 annual letter here.

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https://www.cnbc.com/2019/04/11/ebay-stock-slides-on-bezos-comments-in-shareholder-letter.html

2019-04-11 18:16:00Z
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Uber could file for an IPO any minute. Here's what to expect. - INSIDER

• Uber is expected to file it's initial public offering (IPO) documents as soon as Thursday.
• The company will follow its biggest competitor Lyft to public markets, though Uber's could be ten times larger.
• Uber's IPO could be one of the largest in history. Here's a rundown of what Wall Street is expecting from the company's wide range of businesses and bets.

Uber could file for its initial public offering, or IPO, as soon as today, according to multiple reports.

The ride-hailing giant's offering could be one of the largest in years, and could raise the tech unicorn more than $10 billion to continue its global expansion, but there's one big cloud casting a shadow on everything: Lyft.

Uber's biggest competitor has about a 35% market share in the United States, and beat the company to public markets last month, netting a valuation of about $18 billion. However, in their first two trading weeks, shared of Lyft have fallen more than 20%, despite an oversubscribed IPO that initially traded well above its initial price.

Both companies are deeply unprofitable — and provide basically the same basic services — so the competition comes down to other factors: driver pay, market share, and other factors that can help get the companies to positive cash flow.

"The primary issue is around the underlying metrics that Uber will discuss around take rates, ride sharing data, driver ecosystem, and a myriad of other metrics relative to Lyft which may put the company in a more negative light," Daniel Ives, an analyst at Wedbush, said in a note to clients Thursday.

For many investors, Uber is likely a first-choice thanks not only to its global scale compared to Lyft's North American focus, including foo delivery, self-driving cars, flying taxis and more.

Uber for Everything

All of those other bets rely on the theory that Uber's platform that now provides taxi rides at the touch of a button (and public transit in one city), can be used for a multitude of other services.

Uber Eats, the company's food delivery service that's now active in more than 350 markets across dozens of countries. A company executive explained to Business Insider in March that the service showcases the "power of the Uber platform." The company already allows Uber for Business clients to order expensed meals, and is gearing up for groceries soon.

Read more:An Uber Eats executive reveals the company's surprising strategy for moving beyond taxi rides

Then there's the company's Advanced Technology Group, or ATG, which is working to develop self-driving cars at its offices in Pittsburgh, Toronto, and San Francisco. A high-profile crash in Arizona that killed a pedestrian in March 2018 brought massive amounts of scrutiny to the program and caused Uber to temporarily remove its autonomous vehicles from roads where they were operating.

The company is back to testing, Uber's chief self-driving scientist said on Tuesday, and the company is still investing massive amounts of capital into the software and hardware for its eventual autonomous fleet. After all, self-driving cars are seen by many as the company's only way to profitability given that paying drivers is one of Uber's biggest expenses.

Other bets don't stop at autonomous taxis, either. Uber's new mobility unit is working to advance its bike and scooter offerings, which began with the company's purchase of Jump Bikes last year. Most recently, its scooters launched in Washington D.C. and London among others. The group, overseen by Rachel Holt in D.C., has also launched a public transit integration in Denver, where Uber customers can see options for trains and buses, in addition to car rides. The service is powered by the Israeli tech startup Moovit, and also allows users to purchase train tickets directly in the Uber app.

In the skies, Uber Elevate is working on flying taxis. The group is now overseen by Eric Allison, who previously oversaw the flying car company created by Larry Page called Zee.Aero. Allison took over from former chief product officer Jeff Holden in 2018, shortly after the company's annual elevate conference in Los Angeles. This year's elevate conference is set for June in Washington D.C.

For now, it's all about rides

But until those moonshot services are making money, investors will likely be focused on the company's main ride-hailing business.

One of Uber and Lyft's biggest expenses remains how much they pay drivers. Both companies have fought hard to maintain drivers' status as independent contractors, meaning the company does not have to provide the same benefits it would to a full-time employee.

Under the leadership of founder and former CEO Travis Kalanick, Uber's scandals resulted in a huge bump for Lyft. For more than a year, Lyft worked to project itself as the more driver-friendly alternative, and even disclosed in its IPO filings that it got a big boost from Uber's missteps.

Now, under the leadership of Dara Khosrowshahi, who has led the company since 2017, Uber has taken a different approach. The former Expedia executive summed up the change in one simple sentence: "We do the right thing. Period."

More Uber coverage:

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https://www.thisisinsider.com/uber-ipo-what-to-expect-files-to-go-public-2019-4

2019-04-11 15:19:36Z
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'How about paying your taxes?'—Walmart responds to Amazon's challenge over pay - CNBC

Amazon and Walmart are in war over worker pay — and now corporate taxes.

After Amazon CEO Jeff Bezos on Thursday issued a challenge to other retailers, not naming which ones specifically, to match Amazon's pay and benefits, Walmart has responded, albeit quietly.

"Today I challenge our top retail competitors (you know who you are!) to match our employee benefits and our $15 minimum wage. Do it! Better yet, go to $16 and throw the gauntlet back at us. It's a kind of competition that will benefit everyone," Bezos wrote in his annual letter to shareholders.

Walmart's EVP of Corporate Affairs Dan Bartlett then shared an article on Twitter Thursday morning about Amazon paying $0 in federal taxes on more than $11 billion in profits last year. He wrote: "Hey retail competitors out there (you know who you are) how about paying your taxes?"

tweet

A representative from Amazon wasn't immediately able to comment on Bartlett's tweet.

Walmart's minimum wage of $11 an hour, set in January 2018, is still below Amazon's, which was hiked to $15 in November. But Walmart has said its average worker earns $17.55 an hour with wages and benefits. To stay competitive in the marketplace for talent, taking into consideration such a low unemployment rate in the U.S., Walmart has added perks like subsidizing the cost of higher education for its employees who've yet to earn a college degree. And it started loosening its dress code to let staffers in its stores wear blue jeans.

Meantime, before raising its minimum wage to $15 an hour, Amazon had been facing heightened criticism for its own pay disparity. Sen. Bernie Sanders went as far as introducing legislation called the "Bezos Act" to tax corporations for every dollar that their low-wage workers receive in government health-care benefits or food stamps.

When Amazon last year announced its plans to raise pay, Sanders said: "What Mr. Bezos has done today is not only enormously important for Amazon's hundreds of thousands of employees, it could well be, and I think it will be, a shot heard around the world."

But clearly, Amazon continues to come under attack for not having to pay anything to the IRS.

In 2018, Amazon paid $0 in U.S. federal income tax on more than $11 billion in profits before taxes. It also received a $129 million tax rebate from the federal government. Amazon's low tax bill mainly stemmed from the Republican tax cuts of 2017, carryforward losses from years when the company was not profitable, tax credits for massive investments in R&D and stock-based employee compensation, CNBC previously reported.

In 2018, Walmart paid over $3.2 billion in U.S. federal corporate income taxes.

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https://www.cnbc.com/2019/04/11/walmart-responds-to-amazons-challenge-over-pay.html

2019-04-11 15:15:13Z
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What's moving markets today: Live updates - CNN

US jobless claims dropped to their lowest level since October 1969 last week, the Labor Department reported. Only 196,000 people filed for unemployment benefits in the week ended April 6. The four-week average was 207,000.

The data stressed the strength of the US labor market in the face of worries about economic slowdown.

US stock futures were mostly unchanged Thursday, pointing at a flat to slightly higher open. The dollar, measured by the ICE US Dollar Index, was up 0.2% at 97.108.

In other economic data, the producer price index for March rose 0.6% on the month and 2.2% year-over-year, beating expectations. 

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2019-04-11 14:05:00Z
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What's moving markets today: Live updates - CNN

US jobless claims dropped to their lowest level since October 1969 last week, the Labor Department reported. Only 196,000 people filed for unemployment benefits in the week ended April 6. The four-week average was 207,000.

The data stressed the strength of the US labor market in the face of worries about economic slowdown.

US stock futures were mostly unchanged Thursday, pointing at a flat to slightly higher open. The dollar, measured by the ICE US Dollar Index, was up 0.2% at 97.108.

In other economic data, the producer price index for March rose 0.6% on the month and 2.2% year-over-year, beating expectations. 

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https://www.cnn.com/business/live-news/stock-market-news-today-041119/index.html

2019-04-11 13:55:00Z
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Gold Prices Under Pressure As Producer Inflation Rises 0.6% In March - Kitco News

(Kitco News) - The gold market remains under pressure, but continues to hold on to support around $1,300 an ounce even as whole sale inflation pressures rose sharply last month.

Thursday, the U.S. Labor Department said its Producer Price Index (PPI) rose 0.6% in March, following February’s increase 0.1% ; the data was significantly stronger than expected with economists’ forecasting an increase of 0.3%.

This is the first time in four months that producer inflation beat expectations.

At the same time core PPI, which strips out volatile food and energy costs, increased 0.3% last month, following February’s increase of 0.1%. Economists were expecting to see wholesale inflation rise 0.2%.

However, the gold market is not seeing much reaction to the higher inflation data. June gold futures last traded at $1,301.40 an ounce down 0.94% on the day.

Economists pay close attention to producer prices as it is a leading indicator for consumer prices. Tradionally, companies pass on higher costs to their customers. Economists note that strong PPI data raises the downside risk to consumer inflation pressures.

According to some analysts, gold is not seeing much reaction to the inflation data because most of the increase was due to volatile energy prices. The gasoline index increased 16% last month, according to the report.

For the year, headline inflation rose 2.2%, up from 1.9% reported in February; however, core inflation for the year was 2%, down from February’s reading of 2.3%. According to reports, this is the lowest annual inflation reading since August 2017.

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2019-04-11 12:36:00Z
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Jeff Bezos challenges retail rivals to outdo Amazon’s $15 minimum wage - The Verge

In his annual letter to shareholders, Amazon CEO and founder Jeff Bezos throws in a message to his company’s retail competitors, urging them to start a price war on the minimum wage they pay their employees. Amazon moved to a $15 minimum wage in the United States at the end of last year — though it did so with cuts to benefits and stock grants that meant some employees would end up being paid less, which then led Amazon to announce a further boost in pay to rectify the situation. Still, in a country with a federal minimum hourly pay of $7.25, Amazon’s actions can be considered progressive.

“Today I challenge our top retail competitors (you know who you are!) to match our employee benefits and our $15 minimum wage,” Bezos writes. “Do it! Better yet, go to $16 and throw the gauntlet back at us. It’s a kind of competition that will benefit everyone.”

In June of this year, Target plans to bump its minimum hourly wage to $13 per hour (from the current $12 per hour), ahead of a move to $15 per hour by the end of 2020. Walmart’s minimum wage is $11 per hour. Costco, citing a boost in sales, announced a move to $15 per hour in March. All of these moves are driven, in larger or smaller part, by a highly competitive jobs market, with US unemployment currently measured at 3.8 percent.

With workers harder to find and keep, all retailers are having to spend more on staff, and Walmart is especially sensitive to that, given its massive overhead related to retail locations, and that it employs more than 1.5 million people in the US and more than 2.2 million worldwide. Amazon’s wage increase last year, by contrast, benefited 350,000 employees. The difference in workforce size and overhead costs is part of the reason why Amazon can be more aggressive with its pay increases.

The genius of Bezos’ challenge today is that he wins no matter what. If others go to $15 per hour, he can claim Amazon pushed them to it; if they go beyond that number, that means Amazon’s employees are suddenly cheaper than the competition’s; and if no one else budges, Amazon claims the moral high ground inherent in having a higher minimum pay than its rivals. Never mind what working conditions at Amazon warehouses might be like.

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https://www.theverge.com/2019/4/11/18305891/amazon-minimum-wage-jeff-bezos-shareholder-letter-2019

2019-04-11 11:39:55Z
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