altimeter capital letter

With that said, we have a shortage of talent in Silicon Valley. We certainly are neither short-term traders nor activists. Brad Gerstner founded the. "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. QUARTERLY LETTER 2022 | Vol.1 1345 AVENUE OF THE AMERICA S 33RDFLOOR NEW YORK, NY 10105 HAYDENCAPITAL.COM HAYDEN CAPITAL 2 May 20, 2022 Dear Partners and Friends, The last six months have been extremely painful - by far, the worst period since we started Hayden. 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. Accept. I don't think stocks today reflect a great price discovery about where these stocks are going to be in six months, let alone two years, but I'm also eyes wide open to the fact that we could go lower before we go higher. If the company were investing $12B per year into this project, then that confusion might not even be a problem. In Q1 of 2021, everybody was sitting on their couch. "New Prices for Meta Quest 2s 256GB SKU + Meta Quest Pro. And notably, this decline in share price mirrors the lost confidence in the company, not just the bad mood of the market. But the fact of the matter is the entire market has evaporated around these types of stocks. 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. They're fearful about the war. That's why even the sell side consensus numbers have their growth rate accelerating, almost doubling between Q2 and Q4 of this year and we think it will accelerate even faster. The Meta investor recommends a plan to get the company's "mojo back.". Our best guess is that maintenance capex for Meta is less than $10B annually. It did not specify which of Alitmeter's SPACs Grab was in talks with. This compensation may impact how and where listings appear. So these are different order of magnitude bets. Altimeter Capital Management partner Chris Conforti plans to leave the investment firm, according to people with knowledge of the matter. 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At $20-$25B of annual capex, Meta will still be investing market leading amounts to help invent the future of AI. We were wrong. They are people with families and kids to support. After all, why not hire more people and invest in more things when the cost of capital was near zero and growth seemed unlimited? Chief Executive Officer Metas core business is one of the largest and most profitable in the world with over $45 B in operating profits last year alone. Reuters, the news and media division of Thomson Reuters, is the worlds largest multimedia news provider, reaching billions of people worldwide every day. 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. You do, you do great work, excited for the new show and let's stay after it. This company is perfectly positioned to capitalize on that they have the, the ad network to monetize it. It's down 32% in the last 11 months ,that ranks it in the top three of the last 20 years in terms of drawdowns. This is a business it's grown, it's trading at 28 times free cash flow with 20% growth, that will continue to compound. It's also a vote of less confidence about the company's ambitions in the world of virtual and augmented reality. So, its with some hesitation, but significant conviction, I am sharing an open letter strongly encouraging Meta to streamline and focus its path forward. Ultimately, we and the Board necessarily must share the same objective: maximizing long-term value creation for United's stockholders, customers, and employees. It lost $5.8 billion in the first six months of the year. We're down on the year. But it's good to be here and and you know, while I think we we did see the normalization and multiples as a likely outcome toward the end of last year. 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. It's our largest position we're not selling but we acknowledge that it's been rough for our investors, rough for us. Chase Coleman's: Tiger Global Management. It includes reducing headcount expenses by 20% and limiting the company's pricey investments in "metaverse" technology to no more than $5 billion per year. He joins me live. I don't think they can. Today, the cost of capital has radically changed, and so has Metas growth rate. See here for a complete list of exchanges and delays. It's going to do 20 billion in GMV. With all of this said, we truly believe that the company should be making some of these important investments. In fact, we believe that augmented and artificial intelligence has the potential to drive more economic productivity than the internet itself. It can compound its earnings and this that and the other but I need to know can it get back to that level. When you visit the site, Dotdash Meredith and its partners may store or retrieve information on your browser, mostly in the form of cookies. Days Trial. To put it in perspective, Roblox was a couple percent position for us, right, and Snowflake was a 30% position for us. Altimeter Feb 2021 - Present2 years 2 months New York, United States Chris is a Partner at Altimeter on the private investing team where he focuses on investing in iconic late stage technology. They're fearful about what's going to happen with rates. 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. Altimeter Capital Management, LP The company explained that its goal has always been to "create hardware that's affordable for as many people as possible to take advantage of all that VR has to offer." 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. Investopedia does not include all offers available in the marketplace. They were cratering ironically, now we're normalizing and growth stocks are down even more than they were at the start of COVID. Tina Sharkey, CEO of SherpaFoundry; former board member of HomeAway; and WAPNER: Let me lastly ask you about Grab, the SPAC deal you did, biggest SPAC deal ever of $40 billion. Altimeter Capital Chair and CEO Brad Gerstner, in an open letter to the company, said Meta has too many employees and is moving too slowly to retain the confidence of investors. FalconX Raises $210M Following 30x YoY Revenue Growth; Now Valued at $3.75 Billion Series C Led by Altimeter Capital, B Capital Group, Sapphire Ventures, and Tiger Global Management, with. Meta. Altimeter Capital Management, LLC. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers. A letter addressed to Zuckerberg and the board of directors was published on Oct. 24. It massively distorted multiples on the way in and it's massively distorting multiples on the way out. Indias general insurers are looking to set up a larger marine insurance pool to cover the risks of transporting crude oil, edible oil, project machinery and fertiliser from the war-torn Russia-Ukraine region. effective risk management for all users of derivative products. Your P/E ratio has fallen from 23x to 12x and now trades at less than half the average P/E of your peers. He said a 20% cut in employee spending would take Meta back to the levels of staffing it had last year and argued that the company can't spend as it used to since the cost of capital and interest rates have risen recently. The reductions for the Quest Pro start March 5 in the U.S. and Canada, and on March 15 in other countries where it is supported. Revenue. We have not made this difficult decision lightly, but after thorough, serious, and objective analysis, we feel compelled to act. Can it possibly be worth 200 billion? A Division of NBCUniversal. Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more! As such, we think during this period of growth transition and economic uncertainty, the company should decrease capex by at least $5B and maintain this discipline until revenues re-accelerate bringing our capex as a percentage of revenue more in line with our large cap peers. "We think the recommendations outlined above will lead to a leaner, more productive, and more focused company a company that regains its confidence and momentum," Gerstner wrote. The Wall Street Journal reported on Thursday that Grab was in talks with Altimeter. As you know, we have attempted to work collaboratively with the current Board to meaningfully improve governance, Board composition, and oversight. Rates are going up and we have a war. $6.9 M. With that said, we have a shortage of talent in Silicon Valley. It makes no sense to me, but that is the risk that you run. Credit Derivatives Determinations Committees, how to enable The comp against IDFA was very difficult in Q1 and will again be difficult in q2. I think, or inflation, I think they're behind the curve on recession. That stuff was being advertised on Instagram. Today, the cost of capital has radically changed, and so has Metas growth rate. About Altimeter Capital Altimeter is a global investment firm managing both public and private funds focused on the airline, travel, technology, internet, software, and consumer sectors. Altimeter Capital partner Kevin Wang led the firm's investment in cloud data platform Snowflake in 2015 in its $45 million Series C round; he sat on its board until 2020. Dear Chairman Meyer and Board Members: We have no more confidence that you will act responsibly in the future (even with yesterday's announcement) than we have evidence that you have done so in the past. 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. 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. Whether it is making Whatsapp more seamless or making content and ads more useful on Instagram, Reels and Facebook AI is a globally scarce resource that already is driving noticeable improvements for Metas three billion customers and advertisers. And as a result, you know, last year we held up better than most because we own high-quality stocks, and we were short lower quality stocks. We didn't see the concerns emerging about hyperinflation about 10 to 12 rate hikes, and we certainly didn't see this tragic more unfolding on the doorstep of Europe. We know Meta has more reach, more relevance, and more incredible opportunities for growth than almost any platform on the planet. We know they have high EBITDA margins on the rideshare business which is dominant across the region. We didn't think that was durable. But you also (sometimes) capitalize the first word of a quote. Altimeter's nominees are: In the letter, Gerstner said Altimeter Capital doesn't have demands and simply wants to engage with Meta management. Days Trial Right if the Fed raises rates 10 or 12 times given the demand destruction and the slowdown already underway in this country, we will be in a big recession come fall. CAPEX Investing Aggressively and Responsibly in the Future of AI. In his open letter, Gerstner asked Meta to cap its expenditure on the metaverse to $5 billion a year from the current announced investment of $10-15 billion. It's interesting that now today you say we're in the neighborhood of a tradable bottom. See the Top Performing Hedge-Funds > Brad Gerstner . We have $130 oil and $6 gas at the pump. The move comes amid a decline in Meta's VR shipments and pressure from activist shareholders to improve the financial picture of its metaverse division. Perhaps it was the re-naming of the company to Meta that caused the world to conclude that you were spending 100% of your time on Reality Labs instead of AI or the core business. On top of that we had supply chain challenges. We think both of those are solvable. And so, for our LPs, the bet is simple. Meta has spent billions and hired thousands of employees around the world to build the metaverse, which refers to a shared digital environment that uses augmented or virtual reality technology to make it feel more realistic. If they just take the incremental cash they're going to generate this year and buy back shares that's 6% of the company Scott, let alone the 50 billion in cash they have sitting on the balance sheet. This lack of focus and fitness is obscured when growth is easy but deadly when growth slows and technology changes. But I do believe that this company like the others that we talked about is going to be worth more in the future supported by real free cash flow. The Meta investor recommended a plan to get the company's "mojo back," including reducing headcount expenses by 20% and limiting the company's pricey investments in "metaverse" technology VR software and hardware to no more than $5 billion per year. When exactly did you determine that the Board was so inadequate as to need four new directors, all at once, and without an annual meeting or a stockholder vote? Panel led by former SC judge to include NaBFID chair KV Kamath and Infys Nandan Nilekani. Whatever the reason, that is certainly the perception. Altimeter is focused on technology investment, and has found multi-billion-dollar success. And now we've shot right through the five-year average. I think you're gonna see monetization gains against IDFA and either way we lap that issue in Q3 and Q4. The firm's private equity arm makes all-stage venture capital investments, primarily in the technology sector. Ranked #76 out of 483 Hedge Fund Managers. Data is a real-time snapshot *Data is delayed at least 15 minutes. ", Twitter. I think the only debate is what is the multiple going to be in three months, in six months, in nine months. So listen, I'm not happy about it. Sincerely, Meta (Facebook) Begins Biggest Layoffs in Company's History, Meta (META) Connect Conference Key Takeaways, Meta (Facebook) Shares Slammed as Earnings, Spending Disappoint. At the end of the second quarter this year, Altimeter Capital held more than 2 million shares of Meta. Altimeter Capital Management, LP Buys Opendoor Technologies Inc, Toast Inc, Duolingo Inc, Sells . This will alert our moderators to take action. 233 South Wacker Drive Altimeter Capital's Brad Gerstner Issues Open Letter to Meta (META) and Mark Zuckerberg Article Related Articles ( 4) Stock Quotes (1) October 24, 2022 8:20 AM EDT Tweet Share E-mail Get. We also believe Metas investment in AI will lead to exciting and important new products that can be cross-sold to billions of customers. So I think they got to match the investment to the revenue growth of the business. Stock Radar: 19% from Budget Day! Board of Directors You know, I said on Twitter a few weeks ago, I don't think the Fed's behind the curve on rates. We simply wanted to further engage and continue sharing our thoughts as an interested shareholder. We had given most of that up by middle of December. To set a new and better course for the Company, and to give United stockholders the opportunity to elect the Board they deserve, Altimeter has delivered to you a notice today indicating its intention to nominate six highly qualified professionals led by former Continental Airlines CEO Gordon Bethune to the United Board at the 2016 annual stockholder meeting. As you know we entered the year with a big bond short, we've now covered that bond short because we don't think that it's possible for the Fed to raise rates 7,10, 12 times as some people think this year. It's a better version of Messenger. We agree to pay a one-time fee of $500 to ISDA at or before the submission of this Adherence Letter. CNBC Exclusive: CNBC Transcript: Altimeter Capital Founder & CEO Brad Gerstner Speaks with CNBC's Scott Wapner on "Closing Bell: Overtime" Today Published Mon, Mar 14 20225:56 PM EDT Share. Some companies require tremendous capex investment to maintain their existing business. 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. I said IDFA which is the Apple changes right? 2023 CNBC LLC. 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 between each other Adhering Party and us, the amendments in the Appendices to the Protocol shall apply to each Protocol Covered Agreement to which we are a party in accordance with the terms of the Protocol and this Adherence Letter. 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.

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