Nvidia pulls out 👋
More unicorns, IBM's win, and Manyavar goes to the street.
Market summary: 📊
India caught a breath from the brutal sell off, but really hard to believe we’re done with the flogging just yet. US resumed its downward spiral.
S&P 500 - down 1.22%
Nasdaq - down 2.48%
Nifty 50 - up 0.75%
Sensex - up 0.64%
What’s brewing hot? ☕
🧐 IBM did what? — IBM managed to report one of its best growth quarters in like 10 years! Revenues grew a nice 6.5% YoY — not much for y'all startup folks, but a big deal in big blue’s world. Fyi, after missing the big cloud-software opportunity over the past decade, IBM had been struggling for growth, until some hard changes were made — including getting Arvind Krishna to be CEO, and then selling off a low-margin managed services business. With that, the brown-CEO tech-turnaround streak remains unbeaten!
Nvidia is planning on walking away from ARM 🚶♂️
What happened — graphic card maker Nvidia is pulling out of its $40 billion acquisition offer for low-cost CPU maker ARM, ending a 2-year long pursuit.
Why? Regulators didn’t want the deal to go through.
ARM basically designs CPUs that go into almost 95% of the world’s smartphones, and other low-power electronic devices. It’s independence is a BIG deal to make sure the electronics component-supply chain remains free and competitive, free from any predatory influence.
Meanwhile Nvidia, the $550 billion gorilla, was buying ARM to club their CPU technology with its graphic processors and build an end-to-end computing platform suitable for data/AI processing needs — to sell to large data-centers run by Google, Facebook, Amazon, that ultimately power our internet services.
Anyway, regulators from the UK, which is where ARM is HQ’ed, had flat out refused to let the deal happen, while the US Federal Trade Commission had even sued Nvidia to block the marriage.
What now — ARM stays with its owner Softbank, which will try to plot an IPO get some liquidity and bring outside investors onboard.
Big Picture — regulators getting so aggressive is a big threat to large acquisitions, including Microsoft’s bid for Activision, and even Facebook’s $400M lame-ass buy of gif-maker Giphy.
SaaS unicorns are back 🦄
What’s poppin’ — HR software vendor Darwinbox closed a $72 million Series D from TCV, Sequoia and others, at a $1 billion+ valuation.
The HYD based company is trying to replace legacy giants like SAP and Workday, offering a full-stack, much nimbler HR toolkit for everything from hiring to employee management to performance monitoring and providing feedback.
COVID’s demand for cloud-services helped revenues double to $30 million last year, which could top $50M+ end of this year! The platform reaches 1.5 million employees across Starbucks, Swiggy, Domino’s and other giants.
Meanwhile, fintech looking strong in 2022 💰
Our friends at Raise Financial wrapped up a kick ass $22 million Series A from fintech investor BEENEXT and Mirae Asset. 3one4 Cap and a host of other angels pitched in too.
Raise plans on launching a series of fintech products over the next few years — targeting diverse wealth management, insurance, and other money needs of millennials and GenZ. It’s first product, Dhan, a trading platform for power users has already scaled up to 100K+ users and is redefining the brokerage space.
Maruti choked on chip shortages 🤦
Failure to appeal to evolving tastes of the Indian middle class isn’t Maruti’s only problem. The budget car marker is also struggling to find semi chips to fit in its vehicles, causing sales and profits to tank.
Quick look at Maruti’s quarter:
Net Profit of ₹1.1K crores, came down 48% YoY
Revenue of ₹22.2K crores, essentially flat vs. last year
Sold 4.31 Lakh cards during the quarter, down over 15% YoY
Only positive, price increase helped add 2.5% to margins
Chip shortages halted production affecting at least 90K units. Management tried to do some damage control by sounding hopeful about pipelines easing up as the year goes by.
Saving grace? The performance was better than the markets were expecting, which helped stock rise like 7% amidst yesterday’s rally.
Closing Out — Manyavar dressing for an IPO 🥁
Fat Indian weddings will help men’s festive-wear brand Manyavar sail to an IPO — with Vedant Fashions, the holding company, opening up its bids by the first week of Feb.
Founded in 1999, Manyavar sells its wares at 3,500+ offline locations nationwide, as well as on top online marketplaces like Myntra. Business made ₹900 crores+ in revenues for the year before COVID, after which it took a ~40% hit in sales.
Rising consumption of ethnic wear, a well recognizable brand, and an extremely fragmented market are some positives in the company’s favor. However, getting caught up in the current market turmoil may turn out to be a bit of a party spoiler.
FC OOO 🎉
Y'allzzz its Republic Day so we’ve decided to curl up on the couch with a cup of coffee, spend the morning watching the parade and then sleep the holiday off. Maybe read a book. Which means won’t be no newsletter comin’ tomorrow! We will see y'all on the day after that!
Happy Republic Day, and take a moment to celebrate this amazing country we call home. ✌️
What else are we Snackin'🍿
👀 Layoffs - Unilever is planning to fire about 1,500 employees as part of its restructuring to cut costs in some of its businesses, including healthcare.
🖥️ Zuck’s new toy - Meta unveiled a new AI supercomputer called Research SuperCluster (RSC). Zuck says it’ll be the fastest in the world when finished in March.
🍎 More products - as we close in on Apple’s hardware event launch in a few months, speculation is rife on a host of products, including a 5G low-cost iPhone SE, meant to steal share from Android.
Hit that 💚 if you liked today’s issue.
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