Snap Inc., the parent of social media platform Snapchat, is laying off 20% of its staff, or about 1,280 people. The company is also halting several projects as it aims to cut costs. Snap said it has about 8% revenue growth so far this year, well below its forecast for the year. More: - In a memo sent to employees on Wednesday, CEO Evan Spiegel said the company must face the consequences of lower revenue growth and adapt to the market environment.
- Snapchat’s business model primarily relies on digital advertising.
- Teams expected to see cuts include Zenly, Snap’s social mapping app, and Snap’s hardware division, which is building the company’s AR glasses.
- Snap shares were up ~9% by afternoon trading on Wednesday.
- The company is down over 75% YTD.
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On Tuesday, California's lawmakers passed a bill requiring social media companies like Facebook, Instagram, and TikTok to consider minors' physical and mental health when designing their products. The bill, a first of its kind, passed in a unanimous, bipartisan vote in both chambers. More: - Social media companies opposed the bill, saying that the different state laws that regulate their apps would make it difficult to comply with the new bill.
- Gov. Gavin Newsom has not indicated if he would sign or veto the bill.
- In California, the legislature can override a veto with a two-thirds vote in both chambers.
- The current bill comes after the state failed to pass another bill that would have allowed government lawyers to sue social media companies for harm or addiction in Children.
- This current bill also requires social media companies to disclose their privacy policies in language children can understand.
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On Tuesday, the House Committee on Oversight and Reform sent letters to four federal agencies and five digital asset exchanges asking how they protect consumers from crypto scams and fraud. The committee sent letters to the Department of the Treasury, the Federal Trade Commission, the Commodity Futures Trading Commission, and the Securities and Exchange Commission. More: - The five digital asset exchanges were Coinbase, FTX, Binance.US, Kraken, and KuCoin.
- According to research from the FTC, more than $1B in crypto has been lost to fraud since Jan. 2021.
- In the letters, the committee requests that the agencies and crypto exchanges respond by Sept. 12 with information on what they are doing to protect consumers.
- The committee also asked the exchanges to provide documents dating back through Jan. 1, 2009, showing the companies' efforts to fight crypto scams and fraud.
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Sony has set up a PlayStation mobile game division as it tries to expand its offerings outside of gaming consoles. The company recently acquired Helsinki and Berlin-based mobile game developer Savage Game Studios. Sony said the new unit would run independently of the console business. More: - The move comes as Sony has faced supply chain issues and struggled to meet the demand for its PlayStation 5 console.
- Sony joins gaming giants like Microsoft’s Xbox and Nintendo, who have taken similar steps in setting up mobile game divisions.
- Sony said it plans to release about 50% of its games on PC and mobile by 2025, up from the current 25%.
- According to Newzoo, gaming consoles account for about 27% of the nearly $200B games market.
- Mobile games account for more than 50% of the revenues in the games market.
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Netflix has hired two former Snap Inc. executives to lead the development of the ad-supported tier of its streaming platform. Netflix has named Jeremi Gorman, Snap’s former chief business officer, as its president of worldwide advertising, and Peter Naylor, vice president of sales for the Americas at Snap, as its new vice president of ad sales. More: - The executives are starting at Snap in September.
- Netflix announced plans to launch an ad-supported tier for its streaming service earlier this year.
- The company has struggled with waning revenue and slowed subscriber growth amid stiffer competition within the streaming space.
- Netflix shares closed at $223.56 on Wednesday, up ~1.3% for the day.
- The company is down over 60% YTD.
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Exxon Mobil plans to sue the Russian government unless it is allowed to exit its stake in the Sakhalin-1 oil and gas project. Moscow had implemented a policy following the start of the Ukraine war that prohibits certain transactions through the end of the year. The policy also allows for the ban to be extended beyond 2022. More: - Before the policy was enacted, Exxon had disclosed in regulatory filings that it would be transitioning its operations in the Sakhalin-1 venture to another party due to the ongoing Russia-Ukraine war.
- Exxon has a 30% stake in the Sakhalin-1 venture.
- Exxon has withdrawn from at least 10 joint ventures with Russian entities after the U.S. and its allies imposed sanctions on Russia.
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- Instant-delivery startup Gopuff is looking to borrow up to $300M. The SoftBank-backed company had planned to go public this year but has postponed its market debut due to market conditions. According to sources, Gopuff is nearing an agreement with banks to open a credit line, known as a revolver loan.
- Credit card use in the U.K. rose 13% in July compared to last year, its fasting growth in 17 years. According to data from the Bank of England, borrowers took on a net additional £1.4B ($1.6B) in consumer credit card debt in July.
- Russia shut down its main natural gas pipeline to Europe, the Nord Stream pipeline, on Wednesday for scheduled maintenance. The pipeline is expected to come back online on Saturday. Western allies have accused Russia of economic war on Europe due to its reduced natural gas supply to the continent.
- Restaurant owners and franchisers are trying to persuade California Gov. Gavin Newsom to veto a bill to set wages for fast-food workers. They argue the bill would increase costs and set a precedent that other states might follow. The bill sets the minimum wage as high as $22 an hour.
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 |  | Vanessa Omeokachie is a Researcher at Inside. Her interests include finance, tech, and startups. In her free time, she enjoys reading, hiking, attending music festivals, and traveling. Connect with her on Twitter @VanessaOmeo or through email at vanessa@inside.com |  | | Editor | Aaron Crutchfield is based in the high desert of California. Over the last two decades, he has spent time writing and editing at various local newspapers and defense contractors in California. When he's not working, he can often be found looking at the latest memes with his kids or working on his 1962 and 1972 Fords. | |
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