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Altimeter Capital launched its two SPACs in October and January, raising a combined $850 million between the two blank-check vehicles. I have spent over 20 years investing behind some of the worlds great founders who are helping to invent the technologies that move the world forward. I don't think the Fed is going to throw away two years' worth of work to try to avoid a recession in a election year and run us straight into the teeth of a recession while we're trying to fight a war in Europe. The company has lost investor confidence as it ramped up spending and pivoted to the metaverse, the technology-focused hedge fund with a 0.1% stake said, and suggested a three-step plan. This lack of focus and fitness is obscured when growth is easy but deadly when growth slows and technology changes. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. Got a confidential news tip? Comprender el funcionamiento social, poltico, econmico, cultural y natural de la sociedad a fin de reflexionar, hacer propuestas y asumir compromiso en torno a las polticas de desarrollo nacional, local y regional en el mbito del respeto de los derechos humanos, la integracin econmica y la convivencia social, bajo una concepcin de desarrollo humano sostenible. Prior to Octahedron, Ram was a partner and portfolio manager at Altimeter Capital, a multi-billion dollar investment firm . Finally, Prudential PLC lifted its . 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. Mark Zuckerberg is a self-made billionaire and the CEO of Meta (formerly Facebook), which he co-founded in his dorm room in 2004. Altimeter Capital Chair and CEO Brad Gerstner said in an open letter to the company and CEO Mark Zuckerberg on Monday that Meta has too many employees and is moving too slowly to retain the confidence of investors. In a single quarter, they added 1.4 billion. And frankly, they weren't a very good hedge because bonds haven't moved all that much but gross stocks are down 60, 70, as you mentioned, down over 80%. Altimeter said annual free cash flow can be doubled to $40 billion (roughly Rs. Ultimately, we and the Board necessarily must share the same objective: maximizing long-term value creation for United's stockholders, customers, and employees. This letter constitutes, as between each other Adhering Party and us, an Adherence Letter as referred to in the Protocol. I expected that as the world of normalized post Omicron that we would get back to the five-year average multiple. To put that in perspective, excluding your large metaverse investment, Meta is investing more in capex than Apple, Tesla, Twitter, Snap, and Uber combined! Airline Industry Veteran Gordon Bethune Leads Stockholder-Nominated Updated on September 30, 2022. I think you're gonna see monetization gains against IDFA and either way we lap that issue in Q3 and Q4. Experience Your Economic Times Newspaper, The Digital Way! When you visit the site, Dotdash Meredith and its partners may store or retrieve information on your browser, mostly in the form of cookies. Of course, a company that connects nearly three billion users on phone and text must be investing in the next generation of communication. GERSTNER: Right Scott so that you know I started off by saying you know we've been beaten up this year like everybody else because I was covering shorts as we approach the five-year average. Steven Cohen's: Point72 Asset Management. After all, why not hire more people and invest in more things when the cost of capital was near zero and growth seemed unlimited? These are not numbers on a spreadsheet. Is it all about rates at this point, especially when you're talking about the kinds of vulnerable stocks that we've really had front and center, those being tech? Altimeter Capital owns about 2.46 million Meta shares. Potential Choices for HF Roles from Undergrad | Wall Street Oasis That stuff was being advertised on Instagram. Brad Gerstner founded the. 3,30,700 crore) if it cut headcount by at least 20 percent, trimmed capital expenditure by at least $5 billion (roughly Rs. By any normal company or start up standard, $5 B per year would seem like an extraordinary amount. In the last 18 months, Meta stock is down 55% (compared to an average of 19% for its big-tech peers). Accept. And so, for our LPs, the bet is simple. 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. Despite public skepticism at times warranted we have been supporters of the companys strategy to continuously reinvest in a product-led future and its mission to make the world more open and connected. At $20-$25B of annual capex, Meta will still be investing market leading amounts to help invent the future of AI. It can do great this, the business can be incredible. UPDATE: Altimeter Capital, PAR Capital Issue Letter to United Bill Ackman's: Pershing Square Capital Management. Your P/E ratio has fallen from 23x to 12x and now trades at less than half the average P/E of your peers. When you were with me in December, you said that you had picked some more of that up along with Snowflake. "In short, Meta needs to get fit and focused.". And, while that ultimately is an important long-term measure of success for all of Metas stakeholders, it would be imprudent to make short-term bad decisions just to improve the share price. Brad Gerstner's Altimeter Capital has an $8B profit on Snowflake. A new GERSTNER: So let's talk for a second about what I called. Metas core business is one of the largest and most profitable in the world with over $45 B in operating profits last year alone. Altimeter Capital Management LP Info Size ($ in 1000's) At 12/31/2022: $3,652,571 At 09/30/2022: $4,676,285 Altimeter Capital Management LP holdings changes, total fund size, and other information presented on HoldingsChannel.com was derived from Altimeter Capital Management LP 13F filings. ET on GuruFocus.com Builders Union LLP Buys AppLovin Corp, Match. I imagine they're going to be super aggressive about how they're buying back shares. So no, these issues are rea,l what's going on in Russia is real, what's going on in Europe is real. Worse, this skepticism seemed to be affirmed with a nearly-immediate and sizable miss in financial results and continued under-performance throughout 2022. Oct 24 (Reuters) - Facebook-parent Meta Platforms Inc (META.O) needs to streamline by cutting jobs and capital expenditure, its shareholder Altimeter Capital Management said on Monday in an open letter to Chief Executive Mark Zuckerberg. 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 was founded in 2008 and is headquartered out of Boston, Massachusetts. Get your daily dose of business updates on WhatsApp. But you also (sometimes) capitalize the first word of a quote. And frankly, I was going to play some sound from you from our Delivering Alpha event last September where you called a lot of this but I don't even have to do that anymore because you just went through it. The metaverse is a shared virtual environment with aspects of online gaming, augmented reality, and more that people can access via the Internet. We certainly our base case, as you know, was a soft landing four to five rate hikes into this year. In the last 18 months, Meta stock is down 55% (compared to an average of 19% for its big-tech peers). He also asked Zuckerberg to cut down on capex and employee expenses. So, it doesn't surprise me at all that buyers are on the sidelines and that sellers and short sellers are having a field day with stocks. Q1 2021: 13 Largest Global Startup Funding Rounds - AlleyWatch You got a lot of this right but multiples have come down a heck of a lot to this point. The firm also considers investments in the consumer products and services, gaming, retail, and transportation sectors. The Meta investor recommends a plan to get the company's "mojo back.". Tech SPAC Altimeter Growth Corp. 2 prices further upsized $400 million Enjoy a 7-Day Free Trial Thru Feb 17, 2023! This is a business it's trading at 12 times free cash flow, X the meta investment and 18 times including. By any normal company or start up standard, $5 B per year would seem like an extraordinary amount. 2023 CNBC LLC. 10. We were wrong. This lack of focus and fitness is obscured when growth is easy but deadly when growth slows and technology changes. With all of that said, we believe the company can responsibly and reasonably reign in capex while continuing to invest aggressively in AI and other critical areas. 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. You probably know you should capitalize proper nouns and the first word of every sentence. To read full story, subscribe to ET Prime, Billed annually at At $20-$25B of annual capex, Meta will still be investing market leading amounts to help invent the future of AI. But the fact of the matter is the entire market has evaporated around these types of stocks. Altimeter Capital's Brad Gerstner Issues Open Letter to Meta (META) and 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. Meta Slashes Prices for VR Headsets Altimeter is based in California and has about $16 billion in . August 2012 Protocol ALID: 66703 I think if you said why might these numbers have to come down if we're heading into a recession, the numbers are likely to come down. Right? We want to hear from you.