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| Here’s your daily business briefing. - 📈 Goldman Sachs beats Q1 targets
- 🔍 Deep Dive: Apple's iPhone decline amid rivals' growth
- 💰 Bitcoin boosts BlackRock's AUM to $10.5T
Thanks for reading! Shriram
p/Shriram | |
| 1 | | Goldman Sachs surpassed analysts' forecasts in first-quarter earnings, reporting $11.58 per share compared to the anticipated $8.56, with revenue totaling $14.21B, exceeding estimates of $12.92B. Due to a resurgence in capital markets activity, the bank's profits increased by 28% to $4.13B over the prior year. More: - Revenue from fixed-income trading increased by 10% to $4.32B, $680M more than anticipated.
- Equities trading surged by 10% to $3.31B, around $300M above expectations, propelled by derivatives activity.
- Higher debt and equity underwriting increased investment banking fees by 32% to $2.08B, above projections by almost $300M.
- Revenue in the asset and wealth management division increased by 18% to $3.79B, meeting expectations fueled by private banking and lending revenue growth.
- Driven by higher credit card and deposit balances, the Platform Solutions division's revenue surged by 24% to $698M, above projections by roughly $120M.
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| 2 | | 
What the numbers say: Apple experienced a nearly 10% decline in iPhone shipments during the first quarter, amounting to 50.1 million units, marking its steepest drop since the disruptions of COVID-19 in 2022, while despite Apple's setback, the global smartphone market observed a 7.8% increase in shipments, with Samsung reclaiming the leading position. Relevance: Apple's challenges in maintaining sales in China, where competitors like Huawei and Xiaomi are gaining momentum, have contributed to the decrease in iPhone shipments. In the evolving smartphone market, Android is projected to outpace Apple as the market continues to rebound in 2024. More data: In China, Apple contends with rising competition from Huawei and excess iPhone inventory elsewhere, affecting sales. The company leads consumers to opt for premium models with higher prices. To stimulate sales, Apple offers discounts of up to $180 through select retail partners in China and invests in its retail presence, exemplified by the opening of a large new store in Shanghai, aimed at retaining market presence and customer loyalty. | | | |
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| 3 | | BlackRock reported record assets under management of $10.5T, driven by strong equity markets and the success of its spot bitcoin exchange-traded fund (ETF), while net income surged by 36% YoY to $1.57B for the fiscal Q1, with revenue rising by 11% to $4.7B. CEO Larry Fink emphasized the significant cash reserves, with money market fund balances nearing $9T, influenced by prevailing fear and uncertainty. More: - The firm's spot bitcoin ETF had record-breaking asset growth to $10B and currently stands at $18.7B, adding to the $67B in total ETF flows for the quarter.
- BlackRock is actively pursuing opportunities in private markets and infrastructure to leverage global investments in decarbonization and digitization.
- The Aladdin platform helped the company secure multiple significant mandates, generating recurring revenue even during market weakness and boosting its technology revenues to $377M.
- The U.S. Federal Reserve's high-interest rates caused investors to remain cautious, even though net inflows of $57B exceeded analyst predictions.
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| 4 | | A survey conducted by Bankrate and YouGov in early March involving 2,276 U.S. adults revealed that 39% had utilized at least one BNPL service, with 50% of users using the service to manage cash flow and 37% for its low or zero interest rates. Key issues reported by BNPL users included overspending (29%), missed payments (18%), and difficulties with returns or refunds (18%). More: - According to demographics, Gen Z (51%) and millennials (55%) use technology more frequently than Gen X (31%) and boomers (25%).
- Customers who earn between $80,000 and $99,999 per year make up the most significant percentage of BNPL subscribers (43%).
- During the 2023 holiday season, BNPL services experienced heightened popularity, with online spending reaching $16.6B, marking a 14% YoY increase.
- PayPal's Pay in 4/Pay Later service emerged as the most popular BNPL platform, with 16% of respondents utilizing it, followed by Affirm (12%), Afterpay (12%), and Klarna (11%).
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| 5 | | BNP Paribas SA has agreed to buy Fosun International Ltd.'s 9% stake in insurer Ageas for around $777M, with BNP Paribas' insurance unit initially acquiring a 4.8% stake, pending regulatory approvals for the remainder. This acquisition deepens the ties between BNP Paribas and Ageas, especially within their joint venture, AG Insurance, which operates in Belgium. More: - AG Insurance, a joint venture between BNP Paribas and Ageas, provides a range of insurance products in Belgium, including life and auto coverage.
- The acquisition is projected to minimally affect BNP Paribas's CET1 ratio by approximately 2 basis points, a key indicator of financial robustness.
- YTD, Ageas shares have surged by 8.1%, pushing its market capitalization close to $8.5B.
- Fosun International Ltd., the former stakeholder in Ageas, contemplated selling its stake as part of debt reduction efforts following a series of acquisitions.
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| 6 | | LinkedIn has stepped into influencer marketing by allowing advertisers to promote posts from users, including those with significant followings, aiming to boost its revenue growth, which has stagnated at single-digit rates since 2022. This marketing strategy, typically observed on consumer apps like Instagram and TikTok, involves creators amassing large followings. More: - LinkedIn's Thought Leader ads, launched with limitations last year, enable brands to boost employees' posts, now open to any LinkedIn user with the author's permission.
- eMarketer predicts that by 2026, most U.S. social media marketing funds will go to Meta and ByteDance, with Instagram and TikTok set to gain an additional 2 percentage points of market share.
- Additionally, it forecasts that LinkedIn, launched a year before Facebook, will secure 4% of the market, generate $4.5B in marketing revenue, and keep its share steady for the next two years.
- Unlike Instagram and TikTok, LinkedIn's affluent user base drives up ad costs, but brands prioritize lead generation and return on investment.
- The platform intends to improve its influencer marketing capabilities through agency partnerships and enhanced data insights for advertisers.
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- Roku revealed on Friday that approximately 576,000 accounts were compromised in a cyberattack, marking the service's second breach this year, with hackers accessing accounts through stolen login credentials, as stated in a blog post by Roku.
- Billy Reid has acquired Knot Standard's direct-to-consumer business, including its stores, and will integrate the DTC brand's AI-based made-to-measure software across all of its locations.
- Google announced Friday that it is removing links to California news websites in response to proposed state legislation mandating big tech firms to compensate news outlets for their content.
- StubHub aims for a $16.5B valuation in its summer IPO, having worked with JPMorgan and Goldman Sachs on the IPO process for the past two years.
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 | Freelance Writer | | Shriram is pursuing Master’s in Business with Marketing at Warwick Business School. He worked as a Senior Consultant in Tech and Political Consultancies before his Masters. He is passionate about Tech, Marketing, Strategy, Anthropology and Politics. He is also the Postgraduate Ambassador for Warwick Business School. | | This newsletter was edited by Shriram Jeevakumar | |
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