Monday's Headlines: Shopify Posts Record Black Friday Numbers
Monday, Nov 28, 2022
Here were the biggest movers in the MyWallSt shortlist on Friday:
Coupa Software (COUP) +6.4%
2U (TWOU) +3.9%
Vail Resorts (MTN) +3.8%
Stitch Fix (SFIX) +3.7%
Ericsson (ERIC) +2.8%
Trip.com Group (TCOM) -4.3%
Activision Blizzard (ATVI) -4.1%
Teladoc (TDOC) -3.4%
Huazhu Hotels Group (HTHT) -2.4%
Sea Limited (SE) -2.4%
Shopify Posts Record Black Friday Numbers 🛍️
Shopify received a welcome boost this holiday weekend as it posted record Black Friday sales across its network of merchants. The e-commerce platform received $3.36 billion in sales on the day, which was an increase of 17% year-over-year — or 19% on a constant currency basis.
Black Friday — which for Shopify kicks off in New Zealand and ends in California — has become a truly global shopping phenomenon and one of the most important days of the year for e-commerce companies. At its peak, Shopify was taking in $3.5 million in sales per minute.
President of Shopify, Harley Finkelstein stated:
"Black Friday Cyber Monday has grown into a full-on shopping season. The weekend that started it all is still one of the biggest commerce events of the year, and our merchants have broken Black Friday sales records again".
The success of Black Friday comes as a surprise as soaring inflation and interest rates paint a dour economic picture, with many expecting a more muted performance from e-commerce platforms.
Shopify stock is down 73% year-to-date.
Microsoft Activision Deal Comes Under Scrutiny 🎮
According to people close to the matter, the $69 billion dollar acquisition of Activision Blizzard by Microsoft will likely be challenged by the Federal Trade Commission (FTC). While an antitrust lawsuit blocking the deal is not guaranteed, sources have claimed that FTC employees remain skeptical of both companies' arguments.
One of the largest opponents of the deal is, unsurprisingly, Sony. The manufacturer of the PlayStation — the number one competitor to Microsoft's Xbox — has claimed that if the deal goes through, Microsoft could make hit Activision games like Call of Duty exclusive to Xbox and put competitors at a significant disadvantage while also leaving customers with fewer choices.
In response to the accusations, Microsoft has promised to keep Call of Duty available to Sony, even offering access for the next 10 years. However, the FTC's concerns go deeper than just one title and are focused on the potential for Microsoft to use titles in the future to unfairly favor its own gaming business over competitors.
A spokesperson for Activision called the claims "completely absurd", and stated the company "will not hesitate to fight to defend the transaction if required." While a Microsoft representative said the company "is prepared to address the concerns of regulators, including the FTC, and Sony to ensure the deal closes with confidence."
The news of the potential FTC lawsuit comes after both UK and EU regulators have initiated their own respective probes into the deal. Activision stock fell 4% on Friday on the news and is currently trading well below its acquisition price, indicating the market's uncertainty over whether the deal will go through.
"Knives Out" Sequel Performs Well For Netflix 📺
"Glass Onion: A Knives Out Mystery" was the best performing new release over the weekend, bringing in an average of $13,200 per screen.
The follow up to the hugely successful "Knives Out", was developed by streaming giant Netflix and given a limited release in theaters this week. The film will be released for free on the streaming platform in a month.
It was an unusual move for Netflix, which typically allow its movies to be released to cinemas just a few days before appearing on the service. The success of "Glass Onion" could push the company to give major hits a broader release as it struggles to make up for lagging subscriber numbers. Most studios release films to the box office several months before allowing them to be streamed or rented at home — a practice that was upended during the COVID-19 pandemic.
Netflix management has been cautious of following such an approach, worrying that it would clash with the company's primary subscription model and devalue the overall service. However, the company has struggled to grow subscribers in recent quarters as new competitors have entered the market and economies have continued to open up around the world.
Netflix purchased the rights to two "Knives Out" sequels for nearly $450 million. "Glass Onion" is expected to bring in over $13 million this week despite its limited release, according to reports in The Wall Street Journal.
Netflix shares are currently down 52% year-to-date.