Uber: Slowing growth fails to satisfy Wall Street
Wall Street punished Uber after the “number of new customers coming to the app and overall bookings” fell below expectations, said Kate Conger in The New York Times. The ride-hailing company last week reported a loss of $1.2 billion, better than some analysts had expected and a big improvement over its “horror show” $5.2 billion loss in the previous quarter. Uber promised to reach profitability “if it excluded various costs” by 2021, but that’s not soon enough for investors, who have “become more skeptical of money-burning technology companies.”
Juul: Altria’s $12.8 billion headache
Saying it “did not anticipate the outbreak of vaping-related lung disease,” tobacco giant Altria last week took a $4.5 billion write-down on its $12.8 billion investment in Juul, said Angelica LaVito in CNBC.com. Less than a year after purchasing the 35 percent stake in the e-cigarette startup, Altria has had to deal with the massive fallout from vaping deaths and “federal investigations into the company’s marketing practices.” Several states have banned all e-cigarette sales, while the Trump administration announced plans to remove flavored e-cigarettes from the market until they are FDA approved.
Walgreens: Biggest private equity buyout in history?
Walgreens has been holding “preliminary discussions with some of the world’s largest private equity firms” about taking the drugstore chain private, said Greg Roumeliotis and Mike Spector in Reuters.com. If successful, the talks, which were revealed this week, would result in the largest private equity buyout in history. Such a deal would require several investment funds to work together on the acquisition of Walgreens, which has a market value of $55 billion. Many of the firms “have pushed back on the idea,” concerned over the business prospects of the chain, which is already loaded down with $16.8 billion in debt.
Trade war: U.S. importers pay record tariffs
“The U.S. collected a record $7 billion in import tariffs” in one month, said Josh Zumbrun in The Wall Street Journal. Records released last week show $5 billion in tariff revenue coming to the U.S. Treasury in September from importers of Chinese goods, out of a total $7 billion in levies for the month. The U.S. took in more than $70 billion in tariffs in the first nine months of 2019. That money was paid by the U.S. companies that bought the goods. One executive in the apparel industry, which has been hit especially hard, called it “a massive expansion of taxation on American employers and consumers.”