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  • 10:14 am

Slack IPO: Only 15% of customers are paid

Slack IPO: Only 15% of customers are paid
[Photo: Glenn Carstens-Peters/Unsplash]

If you’re a highly anticipated tech company and not filing to go public currently, what are you even doing?

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In the past few weeks we’ve seen so many companies begin the process of IPO-ing it’s difficult to keep track. Both Lyft and Uber have done so, as has Pinterest, as well as Zoom. And now Slack, which filed its S-1 Friday morning (conveniently the same time as Uber), is being added to the mix. The company plans to be listed on the New York Stock Exchange with the symbol “SK.”

Slack has historically been very tight-lipped about its numbers and growth, so this is a rare look under the engine. While the enterprise collaboration software company does bring in a good amount of revenue–$400.6 million in 2019; $220.5 million in 2018–it’s still not turning a profit. In 2018, Slack reported a net lost of $140 million, and brought it down to $138.9 in 2019.

In its “risk factors” section the company admitted, “We have a history of net losses, we anticipate increasing operating expenses in the future, and we may not be able to achieve and, if achieved, maintain profitability.” It added that its current success is due to rapid growth, which could easily be curbed down the line.

In the S-1, Slack also revealed some user numbers. Slack says it has more than 600,000 organizations (accounts with more than three individual users) using the platform”, and in 2019, it recorded 88,000 “Paid Customers,” including more than 65 companies in the Fortune 100. It describes those accounts as organizations with three or more paid users. Additionally, the company says it has 575 paid customers paying more than $100,000. For comparison, it says it had 59,000 paid customers in 2019 and 298 organizations that paid more than $100,000.

These numbers do show growth for paid subscriptions. Yet compared to Slack’s overall user base, 88,575 isn’t a huge amount of paid users; it’s only 14.8% of the total. Of course, we should keep in mind that both customers and organizations represent groups of people–some organizations have hundreds of users–so the numbers aren’t representative of each user. On that count, Slack says it has more than 10 million daily active users.

As time goes on, we’ll get a better sense for how it will fare on the public market. And hopefully we’ll get some more context about its growth and plans for becoming profitable.

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  • 9:15 am

Pepsi is suing 4 Indian farmers for potato infringement

Pepsi is suing 4 Indian farmers for potato infringement
[Photo: Flickr user Mike Mozart]

PepsiCo is taking four farmers in India to court over potatoes. The multinational corporation that has a market valuation of $177 billion claims that these four growers were illegally cultivating its registered potatoes.

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What, you may be asking, does “registered potatoes” mean? It’s essentially agricultural copyright. PepsiCo, which owns brands like Lays, authorizes only a select number of farmers to grow the specific potato strain it has cultivated for the beloved potato chips. Those four farmers, reports CNN Business, are not part of that select group.

In a statement to CNN Business, PepsiCo said:

PepsiCo is India’s largest process grade potato buyer and amongst the first companies to work with thousands of local farmers to grow a specific protected variety of potatoes for it. In this instance, we took judicial recourse against people who were illegally dealing in our registered variety.

I reached out for additional comment and will update this post if I hear back.

Indian advocacy groups are hitting back at this legal move. They claim that maneuvers like these are a part of a growing conflict between large corporations and struggling farmers just trying to make ends meet. In a letter to the Indian government, farmers associations described Pepsi’s actions as “intimidation and legal harassment of farmers.”

All this because less than half a dozen farmers chose the wrong kind of potatoes to grow. Pepsi is reportedly seeking 10 million rupees ($143,000) in damages from each farmer–but hasn’t confirmed that number on the record.

You can read the full CNN Business story here.

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  • 8:01 am

Google “Thanos” right now

Google “Thanos” right now
[Photo: courtesy of Marvel Studios]

If you’re an Avengers fan, you will probably love this fun little Easter egg left by Google in its search results. If you’re not a fan (wave emoji), you’ll still probably get a kick out of it.

Basically, all you have to do is this:

  • Go to Google’s search window and type in “Thanos.” That’s the name of a super villain in the Marvel universe. (If you need a primer on Avengers: Endgame or Thanos’s whole deal, check out Joe Berkowitz’s roundup.)
  • Click the golden glove on the right side of your screen.
  • Stand back and watch as a magical force takes over, your search results turn to dust, and a bunch of cool sound effects play.

That’s pretty much it. Some Twitter users were asking if this was a sponsored feature, which would make sense given that Disney’s Avengers: Endgame comes out today. Google’s public liaison of search, however, said it was not. “It was just a thing we thought would be fun,” he tweeted. “Because it’s nice to have a little fun in life.”

We agree. Now go see the movie. Or don’t.

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  • 7:20 am

SAS pilot strike: What to know if you’re flying Scandinavian Airlines

SAS pilot strike: What to know if you’re flying Scandinavian Airlines
[Photo: Piergiuliano Chesi/Wikimedia Commons]

Air travel in Scandinavia is going to be tricky this weekend as members of the Scandinavian pilot unions in SAS Scandinavia have gone on strike. As a result, Stockholm-based Scandinavian Airlines has canceled some 673 flights, including domestic and long-haul flights, and others throughout Europe. The strike was authorized after talks on a collective bargaining agreement apparently broke down. The union makes up about 95% of SAS pilots in Sweden, Denmark, and Norway.

Here’s what to know about the strike:

  • 673 flights have been already canceled, affecting about 72,000 passengers. The airline says it will update affected passengers via text message and email on the status of their flights.
  • The negotiations centered around wage increases and working hours, according to AP, and the two sides were unable to reach an agreement, despite talks taking place since March.
  • The strike won’t affect passengers on flights operated by SAS partners, SAS Ireland, or airlines that are subcontractors of SAS. The airline says partner flights make up approximately 30% of all departures.
  • SAS set up a dedicated page where you can track traffic disruptions. Find it here.
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Amazon will spend $800M to bring free one-day shipping to Prime

Amazon will spend $800M to bring free one-day shipping to Prime
[Photo: Amazon]

Get ready for Amazon Prime one-day shipping. At the company’s quarterly earnings call, CFO Brian Olsavsky disclosed that Amazon is working to shorten its promised two-day shipping on Amazon Prime to one day. “Our goal is to evolve the two-day free shipping program to a one-day free shipping program,” he said.

It’s going to cost the company a lot of money, however. Olsavsky said it would cost about $800 million, which will likely eat into Amazon’s bottom line in the coming quarters. “We’re trying to take advantage of the fulfillment capacity and transportation capacity . . . that we have,” the CFO said.

As for a timeline, Amazon wouldn’t give too many specifics. “We expect to make steady programs quickly and through the year,” Olsavky said, but wouldn’t say whether it would be fully rolled out by the holidays.

For now, Prime customers will be happy to have their stuff delivered to them quicker. We’ll see what kind of hell this creates for the people behind Amazon’s logistics program.

Update: An Amazon spokesperson contacted me in regards to the last sentence, which refers to Amazon’s checkered history with workers’ conditions and emphasis on speed and efficiency, and provided me with the following statement: “We’re able to do this because of 20-plus years of investment in our fulfillment and logistics network.”

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Amazon stock jumps on earnings beat, but its ad business lagged

Amazon stock jumps on earnings beat, but its ad business lagged
[Photo: Helen H. Richardson/MediaNews Group/The Denver Post via Getty Images]

Amazon just keeps on being Amazon. Over the last few years, the company has been on a roll in terms of scale–and this past quarter it certainly grew. Still, we may finally be seeing signs of growth fatigue.

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In its latest earnings report, the company disclosed that quarterly sales hit $59.7 billion, up from $51.04 billion the same quarter last year. This exceeded analyst revenue expectations of $59.68 billion. Meanwhile, Amazon hit earnings per share of $7.09, up significantly from FactSet estimates of $4.70. Its operating income, however, was slightly lower than expected, at around $2.29 billion–compared to analyst expectations of $3.1 billion.

Amazon stock seems to be doing okay. Shares spiked a little over 2% in after-hours trading but are now down to a little less than 1%. Amazon’s stock price is currently around $1,914. We’ll see if it’s able to eclipse the $2,000 mark.

Despite the general beat, the report wasn’t perfect. While Amazon’s web hosting business, AWS, grew a great deal this past quarter–hitting $7.7 billion in revenue compared to $5.44 billion the year before–other new businesses faltered.

In its “other” sales, which comprises mostly its burgeoning ads business, Amazon reported $2.71 billion in quarterly revenue. That’s down from the previous quarter’s $3.39 billion, albeit up from last year’s $2.03 billion. This dip may also be due in part to a change in accounting the company adopted last year that involved reclassifying advertising revenue.

Amazon is considered a dark horse when it comes to digital advertising–a potential player to break up the Google/Facebook duopoly. But seeing a decline quarter-over-quarter in this revenue won’t be a great signal to investors, as Amazon had previously grown every quarter up until now.

All the same, the company seems to be trudging along and growing apace. Its growth, however, may be slowing down, which could give investors pause. We’ll keep an eye out on the stock as the evening continues–as well as listen in on the earnings call for any other tidbits.

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Work at one of these 5 companies if you want better work-life balance

Work at one of these 5 companies if you want better work-life balance
[Photo: Fox/Pexels]

The struggle is real, people.

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No matter what their age, gender, and role, the majority (70%) of workers reported that they feel overwhelmed by their workload and are struggling to maintain a work-life balance, according to a LinkedIn Learning survey of more than 2,800 professionals.

What’s a stressed-out worker to do?

Indeed just published a ranking of companies that offer the best work-life balance for those who are looking to jump ship and land in calmer waters.

Among the 15 highly rated companies, those that landed in the top five are:

  1. Keller Williams Realty
  2. In-N-Out Burger
  3. Capital One
  4. Cisco
  5. Caldwell Banker

What they all have in common is flexibility. Of course, realtors and restaurant chains allow their workers to make their own hours. Keller Williams was particularly lauded for trusting its associates to master their own schedules. Cisco, the only tech company on the list, is known for encouraging remote work. Capital One’s reviews noted that employees could work remotely and provides parents with alternative child-care should they have a hiccup in their regularly scheduled arrangements.

You can see the whole list here.

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Even Philip Morris is pivoting to the blockchain

Even Philip Morris is pivoting to the blockchain
[Photos: chuttersnap/Unsplash; Flickr user Bradley Gordon]

A year ago, pivoting to the blockchain was all the rage. If you were a company in dire straits, all you had to do was gin up a press release explaining that you were investing in bitcoin’s underlying technology and then–voila–you had a new business model. Camera companies did it, iced tea companies did it; you name it–they all went blockchain.

Although the dust has slightly settled since then, it seems like Philip Morris International–the corporation that helped get the entire world addicted to tobacco–is also looking into a blockchain pivot. Nitin Manoharan, Philip Morris’s global head of architecture and tech innovation, said at an event in London today, “We want to do public blockchains,” reports Coindesk.

What does that mean, exactly? According to the executive, the multibillion-dollar company would use blockchain to track tax stamps that are printed on cigarette boxes. Those are the printed stickers that are put on cigarettes to prove that a tax has been paid. Philip Morris reasons that by no longer doing the stamps in such a slow analog fashion–and instead performing the transactions on a digital public ledger–the company could save a much as $20 million a year.

This comes as the tobacco giant clamors to find ways to stay relevant in the 21st century. Altria, the tobacco company that spun off from Philip Morris in 2008, bought a 35% stake in e-cigarette manufacturer Juul last year. And Philip Morris has begun offering life insurance for people who quit smoking. This is likely because tobacco use has dropped significantly over the years, according to the CDC, meaning the corporation needs to find both new items to get people hooked onto as well as ways to cut costs.

Blockchain, I guess, is a way to do the latter. Manoharan said that tax stamps were one of six potential uses for which the company could use the new buzzword technology. These pilots are slated to go live within the next year.

We’ll have to wait and see if Philip Morris’s presence is able to bring even more derision to an already-derided sector of the tech industry.

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Norwegian Air may not be profitable this year, thanks to Boeing 737 Max 8 grounding

Norwegian Air may not be profitable this year, thanks to Boeing 737 Max 8 grounding
[Photo: Flickr user Alan Wilson]

Norwegian Air has solid bookings, high demand, decreased costs, and increasing revenue. Despite those promising figures, the budget airline probably won’t make any money this year due to one thing: the grounding of the Boeing 737 Max 8.

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In an earnings release today, the airline’s CEO, Bjørn Kjos, said that he is “pleased with the positive developments this quarter, despite the 737 Max issues.”

And those are some pretty big issues: Norwegian’s Q1 earnings showed the financial impact of the 737 MAX grounding at around $58 million (500 million NOK), translating to what the Independent determined was a loss of $21 for every passenger who flew Norwegian in the first three months of 2019. This loss is partly due to the ongoing grounding of the Boeing 737 Max following two fatal accidents on Lion Air and Ethiopian Airlines that claimed a total of 346 lives.

Norwegian was hit particularly hard as it had 18 Boeing 737 Max 8 aircraft in its fleet. Per the Independent, in the first two months of 2019, about 30% of all 737 Max flights from European airports were operated by Norwegian.

As the grounding continues and the airline waits for Boeing and the U.S. Federal Aviation Administration to agree on a software patch that should correct the faulty anti-stall software implicated in the two crashes, Kjos is optimistic.

However, he’s also stated that he fully expects Boeing to pay up: “We hope and expect that our MAXs will be airborne soon,” Kjos said in a statement in March. “Many have asked questions over how this affects our financial situation. It is quite obvious that we will not pay the costs related to the new aircraft that we have to park temporarily. We will send this bill to those who produced the aircraft.”

Norwegian’s earnings report comes days after Southwest reported it lost revenue of $200 million in its fiscal first quarter after canceling 10,000 flights due to the grounding of the Boeing plane, of which it operated 34. It said the recent U.S. government shutdown was also a factor.

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Canada’s government vows to take Facebook to court over privacy

Canada’s government vows to take Facebook to court over privacy
[Photos: Anthony Quintano/Wikimedia Commons; Clker-Free-Vector-Images/Pixabay]

Facebook may need a bigger piggy bank.

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After the company set aside close to $3 billion in anticipation of an FTC fine, it turns out that might not be enough. That’s because Canada’s Office of the Privacy Commissioner (OPC) released “troubling” findings today, revealing the shocking (shocking!) determination that Facebook violated the country’s privacy laws in the Cambridge Analytica data scandal.

In case you’d forgotten, Cambridge Analytica was the consulting firm that obtained data on millions of Facebook users without their knowledge. Canada’s OPC is now vowing to take the social media giant to court.

In the report, first reported by The Hill, the commission reveals that Facebook did not obtain “valid and meaningful” consent from its users who were unwittingly swept into a data-mining operation by Cambridge Analytica. The political consulting group had purchased the data from a researcher who had collected it through a third-party Facebook app called thisisyourdigitallife. Users would take personality quizzes and then get their friends to take the quizzes, and that data was all shuttled to Cambridge Analytica, which got its hands on 87 million users’ data.

Facebook allegedly knew about the misuse of user data. Per the report, after the data misuse came to light, Facebook “did not take responsibility for giving real and meaningful effect to the privacy protection of its users.” Its safeguards were inadequate, the report concludes, and the company has “failed to be accountable.”

In the wake of that finding, Canada’s OPC recommended that Facebook submit to regular OPC audits to ensure that the company had changed its ways, but Facebook nixed the idea. “The stark contradiction between Facebook’s public promises to mend its ways on privacy and its refusal to address the serious problems we’ve identified — or even acknowledge that it broke the law — is extremely concerning,” Privacy Commissioner Daniel Therrien said in a statement.

When reached for comment, a Facebook spokesperson said this, “After many months of good-faith cooperation and lengthy negotiations, we are disappointed that the OPC considers the issues raised in this report unresolved. There’s no evidence that Canadians’ data was shared with Cambridge Analytica, and we’ve made dramatic improvements to our platform to protect people’s personal information. We understand our responsibility to protect people’s personal information, which is why we’ve proactively taken important steps towards tackling a number of issues raised in the report and worked with the OPC to offer additional concrete measures we can take to address their recommendations, which includes offering to enter into a compliance agreement.”

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What happens to NBC shows on Hulu if Comcast sells its stake to Disney?

What happens to NBC shows on Hulu if Comcast sells its stake to Disney?
[Photo: courtesy of Comcast]

Comcast is in talks to sell its stake in Hulu to Disney, CNBC reported today, citing “people familiar with the matter.”

Comcast currently owns 30% of Hulu, and Disney increased its stake to 60% after acquiring 21st Century Fox last month. While two companies may split up the 9.5% stake that Hulu bought back from AT&T earlier this month, Disney could also try to gain full ownership over the streaming service, which has become a big part of its direct-to-consumer video plans. CNBC notes that even as a minority owner, Comcast still holds some veto power over certain corporate decisions for Hulu, amounting to a bargaining chip for the cable giant.

Publicly, though, Comcast says it still sees the value in owning a chunk of Hulu. In a CNBC appearance on Thursday, Comcast CEO Brian Roberts said it’s “very much in everybody’s interest to maintain” ownership, and that “we’re really glad we own a large piece of it.”

What does all this mean for consumers? For now, not much, as sources tell CNBC that Comcast has no plans to pull content from Hulu, even after launching its own NBC-branded streaming service next year. (Likewise, Comcast has suggested it’s in no rush to pull content from other services like Netflix, which will carry The Office until at least 2021.) But if Comcast does walk away from Hulu, the company might have more incentive to move shows over to its own streaming service at a faster clip.

We reached out to Comcast’s NBCUniversal for comment and will update this post if we hear back.

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Report: NSA decides mass phone surveillance just isn’t worth the hassle

Report: NSA decides mass phone surveillance just isn’t worth the hassle
[Photo: rawpixel]

The U.S. National Security Agency (NSA) has recommended that the White House drop the phone surveillance program that collects information about millions of U.S. phone calls and text messages–or at least that’s what they want you to believe.

According to sources who spoke to the Wall Street Journal, the logistical and legal burdens of maintaining the program, which was set up in the aftermath of the September 11 attacks in 2001, outweigh any intelligence benefits it brings. The details of the sweeping surveillance system, which reportedly collected billions of records per day in its hunt for potential terrorists, were leaked by former intelligence contractor Edward Snowden in 2013. While Snowden was forced into exile, Congress went on to pass the USA Freedom Act in 2015, which shrank the program to a few hundred million records per year.

As privacy watchers and (some) members of Congress started to pay attention to the legal implications of the program and its impact on Fourth Amendment rights and more, the NSA reportedly cut back on its use, apparently because of all those aggravating people whining about rights abuses. Earlier this year, Republican congressional national security adviser Luke Murry claimed that, due to compliance and technical issues, the NSA hadn’t even been using the system for six months.

It’s an interesting turn of events considering that, in the past, the NSA was pretty darned insistent that widespread data collection was vital to protecting national security. President Barack Obama’s former NSA director, Keith B. Alexander, once told the New York Times that “he saw no effective alternative to the NSA’s bulk collection of telephone and other electronic metadata from Americans.” Of course, the NSA may have just decided to outsource the program, or found new tech to do its surveillance.

While the NSA has made its formal recommendation to drop the program, ultimately it’s up to the White House whether to renew it or not.

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Cyclone Kenneth satellite images reveal the terrifying scale of a historic storm

Cyclone Kenneth satellite images reveal the terrifying scale of a historic storm

Cyclone Kenneth, a monster storm that has already claimed the lives of three people, is bearing down on the coast of Mozambique in southern Africa, packing 140-mph winds, dumping rain, causing intense flooding, and threatening hundreds of thousands of people. The cyclone was recently upgraded to Category 4 strength.

Mozambique’s northern province of Cabo Delgado is most threatened, with about 700,000 people at risk, according to AccuWeather. The weather news outlet says Kenneth will be the first hurricane-strength tropical cyclone to hit Cabo Delgado since modern record-keeping began.

The storm comes a little over a month after the country was hit by Cyclone Idai, which devastated the port city of Beira and killed more than 1,000 people, Reuters reports.

Earlier today, a number of media outlets and weather services shared maps, satellite images, and radar scans of the storm, underscoring the cyclone’s enormous scale. For real-time updates, you can visit the BBC’s live storm page.

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E. coli outbreak: What the CDC says you should know about the 10-state ground beef recall

E. coli outbreak: What the CDC says you should know about the 10-state ground beef recall
[Photo: Alexas_Fotos/Pixabay]

Steak tartare fans may want to order something else in the wake of yet another ground beef recall. Georgia-based meat producer K2D Foods, doing business as Colorado Premium Foods in Carrolton, Georgia, is recalling 113,424 pounds of raw ground beef products believed to be contaminated with the same E. coli strain connected to a growing outbreak that has made 156 people sick in 10 states.

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The ground beef in 24-pound packages was shipped in cardboard boxes marked “Ground Beef Puck” with the following “Use Thru” dates:

  • April 14, 2019
  • April 17, 2019
  • April 19, 2019
  • April 20, 2019
  • April 23, 2019
  • April 28, 2019
  • April 30, 2019

The product was shipped to distributors in Florida and Georgia, which troublingly sent it on to restaurants across the region that will hopefully hear about the recall. Check your freezer for ground beef before whipping up a batch of burgers.

They aren’t the only company to recall their ground beef: Today, a Chicago-area meat processor announced a recall of more than 50,000 pounds of ground beef over fears it may be contaminated with the same E. coli strain that caused an expanding 10-state outbreak.

While no deaths have been reported, 20 of the 156 people infected with the strain have been hospitalized, including some with kidney failure, the Centers for Disease Control and Prevention (CDC) said Tuesday.

The voluntary recall was announced late Tuesday night as federal and state officials try to pinpoint the source of the outbreak that is spreading across the nation. Kentucky, Tennessee, and Georgia are seeing the highest number of cases, with others in Florida, Illinois, Indiana, Minnesota, Mississippi, Ohio and Virginia, the CDC says. (See a map of the outbreak here.)

[Screenshot via CDC]
Food safety officials, working in conjunction with the CDC and the Tennessee Department of Health, say many patients report eating ground beef at home or in restaurants. Beef collected from those restaurants was infected with the same strain of E. coli, but authorities haven’t definitively linked them all.

People infected with the strain develop symptoms including diarrhea (often bloody) and vomiting. Most recover within a week, but it can lead to kidney failure.

Also, the first lawsuit has now been filed as a result of the outbreak, USA Today reports, with a Kentucky woman filing suit against K2D Foods after suffering kidney failure.

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Comcast earnings: Jordan Peele’s Us offers bright spot for NBCU

Comcast earnings: Jordan Peele’s Us offers bright spot for NBCU
Lupita Nyong’o (left) and Jordan Peele (right) on the set of Us, written, produced, and directed by Peele. [Photo: Claudette Barius/Universal Pictures]

Comcast may be feeling more tethered to Jordan Peele after today.

The cable and media giant reported its first-quarter earnings this morning, revealing some steep declines for its NBCUniversal unit, mainly due to tough comparisons from the year before. Revenue for the unit fell to $8.3 billion, down 12.5% versus the same period last year. More specifically, those declines were for NBCU’s cable TV and broadcast TV divisions, which dropped 9.2% and 29.4%, respectively. Theme parks were also down slightly.

Comcast blamed the TV declines on the absence of two major sports events that aired during the same period in 2018: the PyeongChang Olympics and Super Bowl LII.

One bright spot in NBCU’s revenue was for its filmed entertainment division, which jumped 7.4% to $1.8 billion for the quarter. Theatrical revenue alone jumped more than 5%, Comcast said, thanks in part to strong box office performances from How to Train Your Dragon: The Hidden World and Us. 

Jordan Peele’s doppelganger thriller did not match the hype of his first movie, Get Out, but it has earned $171 million at the box office (according to Box Office Mojo), a respectable haul for Comcast’s Universal Pictures considering it was a mid-budget movie.

NBCU’s numbers are below. You can check out Comcast’s full earnings report here.

[Screenshot: Comcast]
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Tesla earnings: Oof

Tesla earnings: Oof
[Photo: Alex Iby/Unsplash]

Tesla just got hit with a big loss for its most recent quarter: $2.90 per share on revenue of $4.54 billion. Analysts estimated a loss of $0.69 per share on revenue of $5.33 billion. The company ended its first quarter with $2.2 billion of cash and cash equivalents.

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Tesla paid off a $920 million convertible bond in March, which was largely responsible for the reduction. Another $180 million related to Solar City is due in April.

The company still expects to deliver 360,000 to 400,000 vehicles in 2019. “If our Gigafactory Shanghai is able to reach volume production early in Q4 this year, we may be able to produce as many as 500,000 vehicles globally in 2019,” Tesla noted in its earnings letter, adding that it should be able to produce 500,000 vehicles globally between July 2019 and July 2020. Tesla plans to deliver between 90,000 and 100,000 vehicles next quarter.

The company is behind on production goals. It produced 77,100 total vehicles, of which 62,975 were Model 3 and 14,163 were Model S and X. Both production and delivery of Model S and X vehicles were down over 43% from the same time last year. Meanwhile, the Model 3 is up significantly on all fronts.

On its earnings call, the company said the production problems were an organizational issue. “Half of all deliveries occurred in the final 10 days of Q1,” CEO Elon Musk said. Part of this was related to making upgrades to Model S and X vehicles. There was also a logistical snafu with Tesla’s production process. Musk explained the company was building cars in batches—for example, making all of the orders out of China in the first half of the quarter and all of the orders out of North America in the second quarter. He said the company will be “rebalancing vehicle build” across its global factories to produce in a way that’s more tethered to regional demand.

Earlier this quarter, Tesla said it would be closing some stores, laying off corresponding employees, and moving all of its sales online in an effort to make room in the budget for the $35,000 Model 3. Though Tesla said it would begin selling the $35,000 version of the Model 3 in February, the vehicle has yet to materialize.

Despite looming concerns from investors, Musk has been pushing for a focus on the future. During the call, he announced it would launch its own car insurance product next month. On Monday, he hosted an event to announce a coming autonomous robotaxi fleet, slated for 2020. He promised to have a million self-driving vehicles on roads next year, but many weren’t convinced: Between Monday afternoon and Tuesday morning, Tesla’s stock dropped. No company has been able to debut a self-driving car that is past the pilot stage, and autonomous technology is a costly investment.

Tesla’s technological infrastructure for self-driving relies on computer vision and does not use lidar, which uses laser light pulses to detect objects and their distance. Though a truer version of artificial intelligence in the sense that the car will have to process images in real time to make decisions, it may prove a more difficult path to chart.

On that note, Musk has changed his perspective on raising capital: “I think there is some merit to raising capital,” he told an investor on the call. “This is probably the right timing.” Last year, he said he did not want to do an equity raise.

Tesla also has yet to close a deal to buy Maxwell Technologies, which makes ultra capacitors and battery parts, for $218 million. On the call, general counsel Jonathan Chang said that the deal would come through in mid-May.

In after-hours trading, Tesla’s stock is ever so slightly up.

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Facebook earnings stained by possible $5 billion FTC fine; stock skyrockets anyway

Facebook earnings stained by possible $5 billion FTC fine; stock skyrockets anyway
[Photo: Joshua Hoehne/Unsplash]

Facebook’s first-quarter earnings are highlighted by an accounting allowance for a Federal Trade Commission (FTC) fine that could be as large as $5 billion. The company violated a consent decree with the FTC in 2012, and the agency is just now getting around to levying the fine.

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Facebook said in a filing that it “recorded an accrual of $3 billion in connection with the ongoing inquiry of the FTC,” and that the “range of loss is between $3 billion and $5 billion.” A fine of $5 billion would represent less than 9% of the company’s 2018 revenue.

Despite the fine, Facebook’s advertising business continued humming away in the quarter.

Earnings highlights:

  • Revenue: $15.08 billion (analysts expected $15 billion)
  • Daily active users: 1.56 billion (in line with analyst expectations)
  • Monthly active users: 2.38 billion (roughly in line with analyst expectations)
  • Average revenue per user: $6.42 (analysts expected $6.39)

Facebook and Google hold the best data for targeting ads at consumers. Smaller advertising platforms can’t aggregate the breadth and depth of social and demographic data that the two giants possess, so the duopoly persists and grows. Facebook’s 2018 annual revenue grew 37.35% over 2017 to $55.83 billion.

Facebook CEO Mark Zuckerberg had this to say:

We had a good quarter and our business and community continue to grow. We are focused on building out our privacy-focused vision for the future of social networking, and working collaboratively to address important issues around the internet.

Despite Zuckerberg announcing that his company is moving toward “private, encrypted services,” Facebook stock is up 4.65% in after-hours trading. Privacy is privacy, but business is business.

On a conference call with analysts Wednesday afternoon, Zuckerberg again welcomed a federal privacy law that uses Europe’s GDPR as a model. He also said one company can’t be expected to set the norms for what constitutes hate speech, and that the government should play a role in balancing free speech and safety on online platforms. The CEO said he believed new regulations might hurt Facebook’s business in the short term, but would provide a measure of regulatory certainty that would be beneficial in the long term.

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Amazon lets some Alexa workers see exactly where you are

Amazon lets some Alexa workers see exactly where you are
[Photo: Ryan Mercier/Unsplash]

After reporting a couple of weeks ago on how Amazon lets some workers listen to Alexa voice recordings, Bloomberg is back with a follow-up that says those workers can access users’ locations as well. In some cases, the Alexa audit team can see precise geographic coordinates, which they could easily look up in an app like Google Maps to determine someone’s whereabouts. Two sources apparently blew the whistle after concluding that Amazon was giving its workers overly broad access to personal data.

In response, Amazon told Bloomberg that “access to internal tools is highly controlled, and is only granted to a limited number of employees who require these tools to train and improve the service by processing an extremely small sample of interactions.” The company added that it regularly audits this access and has a “zero-tolerance” abuse policy. (Bloomberg didn’t find any evidence that workers had abused their access to customers’ data.)

For Amazon, listening to recordings from an Echo speaker or other Alexa device does serve a legitimate purpose, as it allows the company to improve speech recognition when something goes wrong. With location data in particular, the Alexa team uses that information to improve local search results. (Also worth reiterating: Amazon only collects audio samples when someone says “Alexa,” rather than constantly sending audio to its servers.) Still, Amazon doesn’t fully spell out the implications of this data collection, and says nothing about location data on the page where users can opt out.

To prevent Alexa workers from listening in, you can head to this page while signed into your Amazon account, select “Manage How Your Data Improves Alexa,” and disable “Help Develop New Features.”

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There’s a giant potato for rent on Airbnb and it’s surprisingly chic

To mark the 75th anniversary of the Idaho Potato Commission, the organization behind the What Kind of Potato Are You? quiz created a giant potato (as one does) and sent it packing on the back of a truck for a potato promotional tour across America. After six years, though, potatoes were well promoted, and so the commission brought the tater home.

Once it was back in Idaho, though, they had a problem: What the heck do you do with a 28-foot-long, 12-foot-wide, and 11.5-foot-tall potato? The answer was obvious (at least to tiny house developer Kristie Wolfe): Turn it into an Airbnb rental. After all, who doesn’t want to sleep in an overgrown potato? It’s like James and the Giant Peach but with more carbs.

[Photo: courtesy of Linda Whittig]
Now the six-ton Boise-based Big Idaho Potato Hotel has been listed on Airbnb. The oversize spud, made up of steel, plaster, and concrete, has all the amenities you would expect in a potato-themed hotel. It sleeps two in a queen bed, and there’s a small bathroom, a fireplace, air-conditioning, and a beverage cooler. Bring your own potato chips just in case you find yourself with a hankering for potatoes for some reason.

While The Atlantic may have declared that the Instagram aesthetic is dead, the potato didn’t get the memo. Instead of potato-themed decorations, it has opted for a surprisingly chic, Instagram-ready interior complete with millennial-pink accents, elk antler chandelier, cute house plants, and views of South Idaho’s Owyhee Mountains.

It costs $200 a night, plus a $31 service fee and $16 in occupancy taxes and fees, bringing the total price of a one-night stay to $247. Just be aware that there’s no TV or Wi-Fi inside the potato, because it is a potato. Maybe spend the night writing potato fanfic instead.

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McDonald’s wants to fill 250,000 jobs with older workers

McDonald’s wants to fill 250,000 jobs with older workers
[Photo: Simon Ray/Unsplash]

With younger workers less eager to take minimum-wage positions, McDonald’s has been left with roughly 250,000 jobs to fill this summer, which it plans to do by hiring older workers.

To bolster its workforce and help older workers find gainful employment, Mickey D’s will be posting open positions on AARP’s online job board. As USA Today notes, this isn’t the first time that McDonald’s has launched a campaign to hire older workers. However, this is the biggest and most concerted effort yet to fill those thousands of jobs. McDonald’s is also working with the AARP Foundation to launch a pilot program in five states that will help match lower-income older Americans with potential jobs.

“For the first time ever, five generations are now working together under the Arches,” said Melissa KerseyMcDonald’s U.S. chief people officer. Her statement is both an encouraging sign of workplace age diversity and a devastating indictment of the economy and the value placed on caring for older members of society.

While teenagers are the stereotypical fast food employee, restaurants are increasingly turning to older people who are eager to remain in the workforce. According to a 2018 Bloomberg story, recruiters love older workers as they tend to be punctual, experienced, friendly, and usually have a stronger work ethic than many of their younger cohorts.

The number of working Americans aged 65 to 74 is expected to grow 4.5% between 2014 and 2024 as people live longer. Ageism is, of course, alive and well, and full retirement is harder to achieve as savings dwindle. Plus, Americans are simply working longer than ever before in order to supplement what insufficient retirement savings they have. Either way, it seems as though retiring to a beach in Boca is increasingly becoming a pipe dream.

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