Items of interest from last week’s corporate happenings:
- Grubhub’s competitors are gaining market share, but the delivery company is also winning customers as the market expands. Grubhub reported that it had a record 1.6 million new diners in the first quarter, compared to the 1.3 new customers from the previous quarter. The company has said that customer quality is improving, as the customers it acquired in January and February are returning to the platform at higher rates than those they acquired in 2017 and 2018.
- Amazon has reported a 17% rise in sales, causing its profit to double. After years of plowing all profits back into the business, the company is starting to realize record profit as it eases spending – the latest quarter’s expenses grew 12.6%, the lowest rate the company has logged in recent years. For the current quarter, Amazon has projected revenue of between $59.5 billion $63.5 billion – or, 13 – 20% growth from a year earlier.
- AT&T reported earnings for the first quarter that missed analysts’ expectations. The company is struggling with $170 billion in debt and has lost around 544,000 TV customers. The wireless service added 80,000 postpaid phone subscribers, but the company had cut the price of its plans to be more competitive, so still missed revenue estimates. Costs of its acquisition of TimeWarner last year continue to weigh heavily on the company. AT&T said that it would raise prices and end promotions in its video business which could result in subscriber losses. It’s counting on offsetting that with its media assets which it is using to launch a WarnerMedia streaming service later this year. But, we’ve talked about the streaming field – it’s a challenging prospect. So, as the WSJ says, “static on the line at AT&T.”
- Microsoft continues to log wins – revenue of $30.6 billion jumped 14% over last year. The company did well in their PC, software, cloud computing businesses. And, it gave a glimpse into the future it sees for itself – both revenue and operating earnings are expected to grow by double digits next year, which would make for 3 consecutive years of growth. Something that’s definitely commendable in a company of that size, where things can go wrong as easily as right. The company isn’t letting size slow it down this time – much can be credited to its smart bet on the cloud service, Azure, which has grown to be the strongest challenger to Amazon.com’s AWS.
- Proctor & Gamble is seeking to prove that the consumer products company hasn’t lost its touch. The company that invented Ivory Soap, Crest toothpaste and disposable Pampers has now developed a way to make laundry detergent, hand soap and shampoo without using a key ingredient: water. The new dry soaps and cleaners come in the form of a small, fabric-like swatch that foam when the users add water during the washing or cleaning. The new products will substantially reduce the water used in production and be lighter and smaller to package and ship. This is expected to allow the company to sell them online, bypassing Amazon and Walmart who traditionally retail the P&G products. The company has launched limited online sales of the dry hand soap and laundry detergent with additional products to be added in June.