☕ 𝗪𝗲𝗲𝗸𝗹𝘆 𝗻𝗲𝘄𝘀𝗹𝗲𝘁𝘁𝗲𝗿 - 𝟯𝟮
Good morning everyone! Last week was full of earnings and this is going to be the same. So far most of the companies we own have reported strong results, except one or two. Now, let’s move into the weekly newsletter:
• 𝗩𝗼𝗹𝗸𝘀𝘄𝗮𝗴𝗲𝗻 𝗛𝟭 𝟮𝟬𝟮𝟭 𝗲𝗮𝗿𝗻𝗶𝗻𝗴𝘀 — $VOW3.DE (Volkswagen AG) reported its second quarter and first half 2021 earnings results, topping pre-pandemic levels and now sitting with a PE ratio of nearly 6x. Europe's largest carmaker reported deliveries of 5 million vehicles in the H1 2021, an increase of 28% YoY. Revenue came at $129 billion, up 35% YoY, and cash flow generated of $10 billion. In the press-release, Herbert Diess, CEO of the Volkswagen Group said “We’re keeping up our high pace, both operationally and strategically. The record result in the first half of the year is clear proof of how strong our brands are and how attractive their products are. The premium segment performed especially well with double-digit returns, as did Financial Services. Our electric offensive is picking up momentum and we will keep on increasing its pace in the months to come. We are also realigning the company with our new Group strategy NEW AUTO so that we can tap future profit pools. In doing so, we are preparing Volkswagen to play a leading role in the new world of mobility.”
Most recently, VW said to have reached an agreement to acquire Europcar Mobility Group, in a $3B deal. Europcar has more than 3,500 rental stations across more than 140 countries and a fleet of more than 350K vehicles in 2019, serving + 5 million customers annually.
Volkswagen also plans to build half a dozen of battery cell plants in Europe and expand infrastructure for charging electric vehicles globally and speed up mass adoption of battery-powered cars.
• 𝗦𝗾𝘂𝗮𝗿𝗲 𝗷𝘂𝗺𝗽𝘀 𝟭𝟬% 𝗮𝗳𝘁𝗲𝗿 𝗲𝗮𝗿𝗻𝗶𝗻𝗴𝘀 — $SQ (Block Inc.) released Q2 earnings last week, in conjunction with the planned $29B acquisition of Afterpay. The company reported gross profit of $1.14 billion, an increase of 91% YoY. Gross payment volume came at $42.8B, increasing by 29% from the previous quarter, as the Seller and Cash App continue to gain traction. The company is said to be acquiring Afterpay for $29B and the Square’s CFO said the decision was driven by the company's size, its growth rate and the way the Australian buy-now-pay-later service fit into Square's strategic mission.
• 𝗣𝗶𝗻𝘁𝗲𝗿𝗲𝘀𝘁 𝘀𝗹𝘂𝗺𝗽𝗲𝗱 𝗼𝗻 𝗲𝗮𝗿𝗻𝗶𝗻𝗴𝘀 — $PINS (Pinterest Inc) has dropped 20% since its earnings release last week as the company reported disappointing user numbers. Monthly active users dropped in the US 5% YoY and 7% MoM. Internationally users increased 13% YoY but dropped 4% MoM. Despite the user drop, revenues actually increased 125% YoY and 27% MoM. Pinterest was also profitable for the quarter, bringing $69 million in net income. So far the company is on profit for the last two quarters, and hopefully will be the first year of profit for the company. The user decline is obviously something to keep an eye on, but as you saw top-line and bottom-line numbers are looking decent. I’ll stay neutral on Pinterest and see where it’s leading in the coming weeks and will also wait for the coming quarters to see where users are going as the management team remains uncertain.
Have a nice week :)
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