Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Sea Limited $400 million Impact from Shopee’s New Seller Order Fees

2. Uber Chinese Expansion via WeChat

3. Adyen Partnership with Worldwide Golf

4. Nubank NuCel Launches Physical Chip

5. Mercado Libre Mercado Play Sees 6x Growth in 18 Months

1. Sea Limited (SE) $400 million Impact from Shopee’s New Seller Order Fees

From July 2025, Shopee introduced significant fee changes for sellers in Indonesia, Vietnam, and Malaysia.

• Indonesia: A flat order-processing fee of Rp1,250 ($0.08) per completed order was added to existing seller commissions, aiming to boost logistics and platform monetization.

• Vietnam: A 3,000 VND ($0.12) "Platform Infrastructure Fee" was implemented per successful order, effective July 1. This applies to all sellers, with few exemptions, and is justified as supporting technology and infrastructure investment.

• Malaysia: Starting July 16, Shopee added a Platform Support Fee of RM0.50 ($0.12) per successful order (excluding 8% sales tax). This fee applies to most sellers, excluding new or low-volume accounts and specific programs.

These charges, layered on top of existing commissions and transaction fees, reflect a regional strategy to offset operational costs and invest in platform improvements. Small and lower-margin sellers are likely to face a meaningful impact on profitability.

Source: Tech in Asia, Vietnam.vn, Shopee Malaysia

My Perspective: Shopee’s fee increases signal strength. You don’t raise fees if you’re worried about competition. Shopee clearly believes its value proposition is strong enough to justify a larger share of the transaction flow through its platform.

Based on Shopee’s estimated e-commerce market share in Southeast Asia in 2024, the incremental revenue impact could be significant:

• Indonesia: With a $56.5 billion GMV and Shopee’s 46% share (~$26 billion), assuming an average order value of $10 implies 2.6 billion orders. At $0.08 per order, this equates to $208 million in new revenue.

• Vietnam: With a $16.0 billion GMV and Shopee’s 65% share (~$10.4 billion), assuming $10 average order value implies 1 billion orders. At $0.12 per order, this results in $120 million in revenue.

• Malaysia: With an $11.5 billion GMV and 62% share (~$7.13 billion), this implies 713 million orders. At $0.12 per order, the added revenue would be about $86 million.

Total Estimated Impact: $414 Million in incremental annual revenue, assuming order volumes hold steady.

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2. Uber (UBER) Chinese Expansion via WeChat

Uber has launched a Weixin Mini Program allowing Chinese travelers to book and pay for rides in international destinations directly through Weixin (WeChat), China’s most widely used social and messaging app. The feature supports Weixin Pay and is fully localized in Chinese, offering a seamless booking experience.

Initially available in Hong Kong SAR and Japan, the program will soon expand to nine more markets, including the US, UK, and France. This move aligns with Uber’s global growth strategy by embedding its services into high-engagement local platforms like Weixin, which boasts over 1.1 billion monthly active Mini Program users.

With 130 million+ Chinese traveling abroad last year and further growth expected in 2025, this partnership supports both Uber’s international ambitions and Weixin’s goal of offering localised digital convenience.

Source: Uber

My Perspective: I believe the market is underestimating how significant this is. Very few Western tech firms have direct access to Chinese consumers, Google and Facebook are blocked, and Uber exited China in 2016 by selling to Didi.

Now Uber is back, targeting a high-spending, mobile-savvy segment of Chinese international travelers without challenging Didi domestically. Integrating into WeChat gives Uber access to a high-volume, high-value consumer base with minimal friction, using familiar payment and UX patterns. This could become a powerful new growth lever.

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3. Adyen (ADYEN) Partnership with Worldwide Golf

Worldwide Golf, a long-established golf equipment and apparel retailer, has partnered with Adyen to unify its in-store and digital payment systems. The retailer will leverage Adyen’s single platform and SFO1 terminals to offer real-time transaction insights, reliable checkout, and flexible connectivity across nearly 100 stores and online channels. This integrated approach helps streamline operations, unlock customer insights, and enhance personalisation.

Source: Adyen IR

My Perspective: While this move marks a strategic entry into a specialised vertical, Adyen faces tough competition from niche players like GolfTranz, foreUp, and Golf Pro Payments, which offer golf-specific solutions. However, Adyen’s platform stands out for its ability to support both in-store and online payments, provide customer insights, and scale across industries.

Adyen has been working with golf brands since at least 2019 and continues expanding into verticals like sporting goods, including partnerships with Dick’s Sporting Goods. Despite golf’s specialisation, Adyen is positioning itself as a versatile platform that serves both niche and mainstream markets effectively.

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4. Nubank (NU) NuCel Launches Physical Chip

Nubank has expanded its digital mobile service, NuCel, by launching a physical SIM chip option for customers in Brazil. It is free and delivered directly through the app, complementing the existing eSIM feature introduced in October 2024. The rollout will begin with users who previously registered interest. Alongside the launch, NuCel has enhanced its mobile plans, offering more data at no extra cost and lower prices for higher-tier plans.

Key features across all plans include unlimited calls, WhatsApp usage, Nubank app access, and a savings box yielding 120% of the CDI. With 93% national coverage and Brazil’s fastest 5G, NuCel provides flexible, no-contract planswith seamless app-based management. Additional perks are available for Ultravioleta and Nubank+ customers, such as bonus data and personalized plan recommendations. High customer satisfaction and strong adoption continue to reinforce Nubank’s ambitions to reshape mobile telecommunications in the region.

Source: Nubank IR

My Perspective: Nubank’s launch of physical NuCel SIM cards is highly strategic. It dramatically broadens its potential customer base beyond eSIM-compatible devices to include nearly the entire Brazilian smartphone market, where physical SIM usage remains dominant. This move could significantly accelerate user growth and deepen integration between Nubank’s digital banking ecosystem and users’ daily mobile connectivity.

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5. Mercado Libre (MELI) Mercado Play Sees 6x Growth in 18 Months

MercadoLibre is making waves in streaming through its free, ad-supported platform, Mercado Play, now available in eight countries. Rather than competing with giants like Netflix, the service is designed to complement paid subscriptions and deepen user engagement within the broader MercadoLibre ecosystem.

Since launching 20 months ago, Mercado Play has grown from 1 million to over 6 million monthly viewers as of July 2025. It boasts more than 8.8 million app downloads and a catalog of 15,900 hours of content across 2,500 titles. Accessible on over 70 million smart TVs, the platform is already used by around 15% of MercadoLibre users. Looking ahead, the company plans to double its user base, expand content, including sports and music, and roll out new ad formats via Mercado Ads, its in-house advertising unit. This strategy connects streaming consumption with shopping behaviour, particularly during off-peak e-commerce hours, creating a complementary experience that enhances user retention and engagement across the entire platform.

Source: Bloomberg

My Perspective: Mercado Play’s rapid user growth is strengthening engagement and loyalty across the MercadoLibre ecosystem, positioning it as a key catalyst for the company’s broader strategy. As a free, integrated feature within the super app, Play drives daily user interaction and supports adoption of e-commerce, payments, and advertising services. Its growing viewership expands high-margin video ad inventory, accelerating revenue growth for Mercado Ads. Streaming also provides valuable first-party data, enhancing targeting and cross-selling across the platform. With Play now available on over 70 million smart TVs, MercadoLibre is reaching new households and improving retention through free, quality content. These dynamics create a flywheel effect that reinforces MercadoLibre’s ecosystem advantage beyond traditional e-commerce.

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Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Nubank Mexico Reaches 10 Million Customers & UK Legal Domicile

2. Evolution Plans to Release +110 New Games in 2025

3. Uber Partnerships with Home Depot and Wegmans

4. Adyen Digital Payment Gateway Market Research Report

5. Texas Instruments Q4 2024 Earnings

6. Meta to Invest Up to $65 Billion in AI in 2025

1. Nubank (NU)

Mexico Reaches 10 Million Customers

Nu has achieved a significant milestone in Mexico, reaching 10 million customers—doubling its customer base within the last 12 months. This accomplishment means Nu now serves nearly 12% of the adult population in Mexico. Its 100% digital model ensures coverage of over 98% of municipalities, including areas without traditional bank branches.

Since its launch in Mexico in 2019, Nu has expanded its offerings from a credit card to include savings accounts, debit cards, personal loans, and a cash withdrawal/deposit network with over 30,000 points, including OXXO stores.

Nu has been pivotal in fostering financial inclusion, with 50% of its customers accessing credit and 63% earning yields on savings for the first time. By Q3 2024, Nu had 8.9 million Cuenta customers and $3.8 billion in deposits. The company has invested $1.4 billion in Mexico, solidifying its status as a significant foreign investor.

Nu is also pursuing a banking license to expand into payroll accounts and introduce new credit options.

Source: Nubank IR

My Perspective: Nu took approximately five years to reach 10 million customers in Brazil. Considering that Mexico's population is only 60% of Brazil's, Nu's penetration in Mexico is even stronger. In Brazil, 56% of the adult population are Nu customers. If Nu achieves a similar penetration rate in Mexico, it could potentially exceed 70 million customers. This is feasible given that 42% of Mexico's population currently lacks access to financial services.

UK Legal Domicile

Nu is exploring the possibility of relocating its legal domicile to the United Kingdom as part of its global expansion strategy. This move could significantly bolster the UK’s post-Brexit financial landscape.

"We are actively evaluating which jurisdictions make sense for us to consider as we plan for the next 10 years of global growth. The UK is one of the options we are exploring.”

David Velez, CEO

Nu aims to expand internationally over the next decade, potentially entering the U.S. market, which could offer a more favorable regulatory environment for fintech and cryptocurrencies. Simplified banking regulations in the U.S. might further enhance the country’s appeal for new entrants.

“With the U.S. showing renewed interest in fintech and crypto, the sector is gaining momentum again. When an administration starts viewing fintech as beneficial for consumers and promoting competition, it becomes a much more attractive market.”

David Velez, CEO

Source: Reuters

My Perspective: Social media speculated that this move indicated Nu’s imminent expansion into Europe. However, David Vélez clarified that launching services in Europe is not a priority due to regulatory and competitive challenges. Instead, a European domicile could serve as a legal hub for managing the group and recruiting talent. Nu, currently domiciled in the Cayman Islands, already has about 40 employees in Berlin since opening offices there in 2017. Don’t just read the headlines, folks.

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2. Evolution (EVO) Plans to Release +110 New Games in 2025

At the ICE Barcelona 2025 event, Evolution unveiled plans to release 110 new games in 2025, showcasing innovations across its eight brands: Evolution, NetEnt, Red Tiger, Ezugi, Nolimit City, Big Time Gaming, DigiWheel, and Livespins.

Major live games include:

• Ice Fishing: A speed game show featuring a virtual money wheel, real-time fishing mechanics, multiplier wins, and three bonus games.

• Marble Race: A visually immersive, fast-paced marble racing game with custom tracks.

• Race Track: An ’80s arcade-style RNG horse racing game with dynamic betting options.

• Fireball Roulette: Builds on the Fireball bonus mechanic, delivering a high-energy roulette experience.

Todd Haushalter, Chief Product Officer, emphasised the diverse innovations and exciting roadmap for 2025:

“Yet again, our licensees can look forward to the very best of online gaming from our Group roadmap for 2025.”

Source: Evolution IR

My Perspective: After releasing a record 100 games in 2024, it’s great to see Evolution continuing to innovate with plans for even more releases in 2025. Friend of the newsletter attended the event in Barcelona, and I look forward to him sharing insights from the event soon.

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3. Uber (UBER)

Partnership with Home Depot (HD)

Uber has partnered with Home Depot to provide on-demand and scheduled delivery of home improvement products. Customers can now order essential tools, supplies, and materials directly through the Uber app.

This partnership caters to both professional contractors and DIY enthusiasts, offering quick access to a wide range of products. Deliveries are available from over 2,000 Home Depot locations across the U.S.

Uber users can browse a curated selection of Home Depot products, including tools, building materials, gardening supplies, and more. Flexible delivery options and real-time tracking enhance the customer experience.

Source: PR Newswire

My Perspective: This is a smart partnership for Uber as it continues expanding into retail delivery, enhancing its platform’s utility beyond food and groceries. Much debate surrounds the potential existential threat of autonomous vehicles to Uber’s business model. However, nearly 40% of Uber’s revenue now comes from its delivery segment. Partnerships like this showcase Uber’s efforts to diversify its business and reduce reliance on mobility services.

Partnership with Wegmans

Uber has partnered with Wegmans Food Markets, a renowned supermarket chain with over 110 stores, to deliver groceries directly to customers' doors. This collaboration enhances consumer access to Wegmans' high-quality offerings via the Uber Eats and Uber apps.

The service is now live in Wegmans locations across Massachusetts, Maryland, Virginia, North Carolina, New Jersey, and Washington, D.C. Additional locations in New York, Pennsylvania, and Delaware will join the platform in February.

Source: PR Newswire

My Perspective: This partnership is another example of Uber diversifying its services as it continues to expand its grocery delivery offerings, reinforcing its mission to make shopping more accessible. Furthermore, as Uber broadens its service range, the value of its Uber One membership program becomes increasingly compelling. Uber One members enjoy benefits such as $0 delivery fees and a 5% discount on all Wegmans orders with a minimum purchase of $35.

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4. Adyen (ADYEN) Digital Payment Gateway Market Research Report

This week, Research and Markets released its Digital Payment Gateway Market 2025 report. Valued at $106.2 billion in 2024, the market is projected to reach $205.9 billion by 2030, growing at a CAGR of 11.50%.

Key drivers of this growth include:

• E-commerce Expansion: Increased online shopping drives demand for seamless payment solutions.

• Consumer Behavior: Growing preference for online and contactless payments.

• Smartphone Penetration: Rising adoption of smartphones and internet access makes digital payments more accessible.

• COVID-19 Impact: The pandemic accelerated the shift to digital and contactless payments.

Source: Research and Markets

My Perspective: Adyen continues to capture market share from incumbents, and the investment thesis is bolstered by the secular growth tailwinds in the digital payment gateway market. With its strong position, Adyen is well-placed to capitalise on this huge market opportunity and benefit from its long runway for growth.

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5. Texas Instruments (TXN) Q4 2024 Earnings

Revenue

• Total revenue: $4 billion, down 3% sequentially and 2% year-over-year (YoY).

• Analog revenue, which accounts for approximately 80% of total revenue, grew 2% YoY after eight consecutive quarters of decline.

• Embedded Processing, representing about 15% of revenue, declined 18%, while the Other segment grew 7% compared to the same quarter last year.

Profitability

• Gross profit: $2.3 billion, resulting in a gross profit margin of 58%. Sequentially, gross profit and margin declined by 190 basis points, due to lower revenue, higher depreciation, and reduced factory loadings.

• Operating profit: $1.4 billion, representing an operating margin of 34%, down 10% YoY.

• Net income: $1.2 billion, or $1.30 per share.

Capital Management

• Cash flow from operations: $2 billion in the quarter.

• Capital expenditures: $1.2 billion.

• Returned value to shareholders through:

  • $1.2 billion in dividends, including a 5% dividend increase in Q4, marking the 21st consecutive year of dividend growth.

  • $537 million in stock repurchases.

Q1 2025 Outlook

• Revenue: Expected to be in the range of $3.74 billion to $4.06 billion.

• Earnings per share (EPS): Forecasted between $0.94 and $1.16.

Source: Texas Instruments IR

My Perspective: TXN’s revenue and EPS exceeded consensus estimates by 4% and 9%, respectively. However, guidance fell short of market expectations.

As a highly cyclical business, TXN remains exposed to ongoing challenges. Management noted that some industrial markets, such as industrial automation and energy, have yet to stabilize. To manage inventory effectively, the company is reducing factory loadings. This downcycle is proving to be longer-lasting than many, including management, had anticipated.

On a positive note, TXN is nearly 70% through a six-year elevated CapEx cycle. Once completed, this investment will uniquely position the company with dependable, low-cost 300-millimeter capacity at scale, enabling it to meet future customer demand efficiently.

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6. Meta (META) to Invest Up to $65 Billion in AI in 2025

Meta CEO Mark Zuckerberg has announced plans to increase the company’s capital spending to $60–$65 billion in 2025, representing a ~70% increase from 2024. This ambitious projection includes a $14 billion jump over 2025 analyst estimates, with 2024 spending already expected to rise 40% year-over-year to $38 billion.

The surge in investment is primarily driven by advancements in artificial intelligence (AI), including the development of cutting-edge AI models and the construction of massive data centres. Meta plans to bring one gigawatt of computing power online and significantly expand its GPU capacity, aiming to close 2025 with over 1.3 million graphics processing units (GPUs). Among the key initiatives is a $10 billion, 4-million-square-foot data center in Louisiana, which will rank among the largest in the world, underscoring Meta’s ambition to dominate AI infrastructure.

Zuckerberg described AI as a transformative technology, positioning Meta at the forefront of innovation while reinvigorating the company’s growth strategy. He emphasised that these investments are critical to transforming Meta’s core products and reinforcing America’s leadership in AI.

Source: Threads

My Perspective: This is a bold statement from Zuckerberg, especially within the broader AI narrative. While investors are generally optimistic about AI-driven growth, concerns remain about the profitability of such investments and the long-term sustainability of this spending surge.

Zuckerberg seems convinced that these investments will drive the development of essential products, fuel innovation, and ensure Meta maintains its competitive edge in the tech industry.

Meta’s plan to end 2025 with over 1.3 million GPUs highlights a major opportunity for hardware suppliers. Nvidia, as a leading provider of AI chips, stands to be a significant beneficiary of this initiative. Meanwhile, AMD, whose stock has been under pressure recently, could also benefit. Meta is AMD’s largest customer for its Instinct MI300 data center GPU accelerators, having purchased 173,000 units in 2024. This makes AMD a stock to watch in the context of Meta’s AI expansion.

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Happy investing

Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Evolution A Whirlwind Week of News

2. Nubank Mexico Partnership with OXXO & USDC Rewards Expansion

3. Sea Limited SeaMoney to Offer Motor Insurance

4. Amazon AWS Launches $5 Billion Cloud Region in Mexico

5. Mercado Libre Leads Retail Media in Latin America

6. InPost to Invest £600 million in the UK

1. Evolution (EVO)

Thailand Approves Casino and Gambling Law

Thailand's cabinet has approved a bill to legalize entertainment complexes with gaming, moving it to parliament for final approval. If passed, the law could come into effect within 7–9 months, with the first complexes opening by 2029.

A government study projects that these entertainment complexes could generate 406.6 billion baht ($12 billion) in tourism revenue in their first year, create up to 20,000 jobs, and increase tourist arrivals by 5–10% during the low season—resulting in a 13% rise in overall tourism revenue. This initiative aims to revitalize Thailand’s economy, which is still recovering from the COVID-19 pandemic.

Thailand could potentially outpace Japan, with its first casino projected to open before Japan's MGM Osaka in 2030. Five casinos are planned in key locations: Bangkok (2), Chiang Mai, Phuket, and the Eastern Economic Corridor. Seven international operators, including Melco Resorts, MGM Resorts, Galaxy Entertainment, and Genting Berhad, have expressed interest in obtaining licenses.

Source: iGB

My Perspective: Of particular interest to Evolution shareholders are the comments from former Prime Minister Thaksin Shinawatra, who advocates for legalizing and taxing online gaming. This reform could generate 100 billion baht ($3 billion) annually from a 20% tax. Draft rules for online gambling reform are expected to be ready within a month.

Wyoming and Indiana Introduce Bills to Legalise Online Casinos

Wyoming and Indiana are the latest states considering the legalisation of iGaming, reflecting growing efforts to regulate online gambling across the U.S.

• Wyoming: House Bill 162 requires operators to obtain licenses with fees of $100,000 for initial licensing and $50,000 for renewals. A 16% tax on monthly gaming revenue would fund county health programs, schools, and state initiatives.

• Indiana: House Bill 1432 permits licensed riverboats, racetrack casinos, and gaming permit holders to offer iGaming. Taxes on adjusted gross receipts range from 22% to 30%, with funds allocated to local services, horse racing, and gambling addiction programs.

Source: Next

My Perspective: Previous efforts to legalize online gambling have been unsuccessful, so this is far from a done deal. Progress has been hindered by the fallout from a 2023 corruption case involving former legislator Sean Eberhart, who was convicted of fraud related to gambling legislation.

Wyoming and Indiana are at different stages of regulating iGaming. Wyoming emphasizes a structured and conservative rollout, while Indiana faces challenges stemming from legislative scandals.

Investigation by the Swedish Financial Supervisory Authority

Evolution has received a request from the Swedish Financial Supervisory Authority (FI) regarding a press release issued on December 20 last year. The release, titled "Regarding the UK Gambling Commission's Investigation," announced that Evolution’s games were accessible in the UK through operators without a British license, prompting an investigation.

Evolution deemed this information as market-sensitive insider information. Documents reviewed by Dagens Industri reveal that FI’s case involves Evolution’s decision to delay the disclosure of insider information. Evolution was informed of the investigation at 5 PM on December 19 but did not inform the market until 5:45 PM on December 20—more than a day later.

Under the EU Market Abuse Regulation (MAR), companies may delay disclosure of insider information under certain conditions, provided the delay does not mislead the public. The decision to delay disclosure was made by Chief Financial Officer Jacob Kaplan, who, according to documents, played a central role. Notably, Kaplan's departure from the company was announced on January 7, with Joakim Andersson appointed as the new CFO effective February 18.

Source: Dagens Industri

My Perspective: This investigation raises further compliance concerns for Evolution. While EU MAR permits delayed disclosure under specific conditions, we must wait to see if these conditions were met. Dagens Industri suggests that the decision to delay disclosure was tied to outgoing CFO Jacob Kaplan. Was this merely a coincidence, or did it play a role in his departure? As always, there’s never a dull moment with Evolution!

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2. Nubank

NU México Partnership with OXXO

Nu México has partnered with OXXO, a leading small-format store chain with over 22,000 locations across Mexico. Starting January 14, 2025, Nu cardholders will be able to withdraw cash at OXXO stores, with a cash deposit featurelaunching later in the year.

This partnership aims to promote financial inclusion in areas underserved by traditional banks, addressing the ongoing reliance on cash for millions of Mexicans. The addition of OXXO complements Nu’s existing network of over 30,000 physical contact points, which includes major chains like Soriana, Chedraui, Kiosko, and Systienda, supported by Arcus by Mastercard infrastructure.

Source: Nubank IR

My Perspective: Mexico remains a predominantly cash-based economy, presenting both a significant opportunity and a challenge for Nubank. The opportunity lies in the expected growth of digital payments over time. However, the immediate challenge is transitioning this cash onto the Nubank ecosystem. The partnership with OXXO is a practical step in bridging this gap. It enables Nubank cardholders paid in cash to deposit their earnings into their Nubank accounts through OXXO’s widespread network.

USDC Rewards Expansion

Nubank has expanded its USDC rewards feature to all Nubank Cripto users in Brazil following a successful pilot program. Users can now earn daily returns at a fixed annual rate of 4% on a minimum balance of 10 USDC.

USDC is a stablecoin backed by US dollars, with reserves that are publicly verifiable and redeemable at a 1:1 ratio, offering significantly less volatility compared to other cryptocurrencies.

The program is highly flexible, allowing users to activate or deactivate participation directly through the app. Returns are automatically credited daily, with funds immediately accessible.

In 2024, USDC holdings by Nubank customers grew tenfold, with approximately 30% of users holding USDC in their portfolios. Additionally, over 50% of new Nubank Cripto users selected USDC as their first cryptocurrency.

Source: Nubank IR

My Perspective: Nubank’s USDC offering has gained substantial traction in Brazil, driven by its appeal as inflation protection. With Brazil’s inflation rate at 4.8% in 2024, USDC provides Brazilians with a stable store of value, functioning as a digital dollar that shields savings from local currency depreciation

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3. Sea Limited (SE) SeaMoney to Offer Motor Insurance

SeaMoney has partnered with Takaful IKHLAS to offer Shariah-compliant motor protection through the Shopee app. The product, IKHLAS Private Car Comprehensive Plus Takaful, is part of Shopee's growing suite of digital insurance and takaful services—a form of insurance based on mutual assistance and Sharia law.

This motor takaful offering aligns with Islamic law, which prohibits interest payments and investments in sectors like gambling, alcohol, pork production, and non-Islamically structured finance or life insurance.

Customers can easily purchase motor takaful protection directly via the Shopee app, simplifying the process and providing peace of mind with minimal effort.

Source: Middle East Insurance Review

My Perspective: The launch of Shariah-compliant motor protection further broadens SeaMoney’s service offerings, which already include ShopeePay (digital wallet), SPayLater (consumer financing), micro-lending, and insurance distribution via SeaInsure Agency Malaysia. This diversification strengthens SeaMoney’s position as a leading digital financial services provider in the region.

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4. Amazon (AMZN) AWS Launches $5 Billion Cloud Region in Mexico

AWS has announced an investment of over $5 billion in Mexico over the next 15 years, underscoring its long-term commitment to the region. This initiative is expected to contribute approximately $10 billion to Mexico’s GDP during its lifecycle and support more than 7,000 full-time equivalent jobs annually. These roles will span construction, facility maintenance, engineering, and telecommunications.

The new AWS Mexico Region offers cutting-edge cloud technologies, including AI, machine learning, and IoT, empowering businesses, governments, and organizations to innovate and scale efficiently. This region joins AWS’s global network, which now comprises 114 Availability Zones across 36 geographic regions, with further expansion planned in New Zealand, Saudi Arabia, Taiwan, and Europe.

Source: Business Wire

My Perspective: This is undeniably positive news for Amazon shareholders, but it also bodes well for companies with exposure to Mexico’s economy, which is poised for significant growth. Nubank and Mercado Libre, I’m looking at you.

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5. Mercado Libre (MELI) Leads Retail Media in Latin America

Mercado Libre is recognized as a leader in retail media across Latin America, with its advertisements ranked as the most useful and relevant in the region, according to Kantar Media Reactions 2024. It also ranks among the top three preferred online platforms for receiving ads, while Mercado Pago is included in the top five.

Retail media—particularly ads on e-commerce platforms—has become a favored advertising channel in Latin America, second only to influencer content. A staggering 83% of Latin Americans use Mercado Libre to shop, compare prices, and explore promotions. Moreover, 8 out of 10 users conduct general searches to discover options rather than focusing on specific brands.

Mercado Libre and Mercado Pago ads are highly valued for their usefulness, reliability, quality, ability to capture attention, and relevance. Notably, 82% of users find these ads helpful in discovering brands and products and resolving doubts about potential purchases.

Source: America Retail

My Perspective: The statistic that 83% of Latin American users rely on Mercado Libre for shopping, price comparisons, and promotions is remarkable. This underscores the likelihood that the market understates the value of Mercado Ads, its digital advertising unit. Mercado Libre’s ad ecosystem enables end-to-end optimisation of the purchase process, solidifying its position as a key partner for advertising strategies in Latin America.

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6. InPost (INPST) to Invest £600 million in the UK

InPost has announced plans to invest nearly £600 million in the UK, raising its total investment in the region to £1 billion by the end of 2029. This expansion is expected to create up to 12,000 new jobs, solidifying the UK as InPost’s fastest-growing market.

The company aims to increase the number of automated parcel machine (APM) locker sites by over 50% in 2025, catering to surging consumer demand. By the end of 2024, InPost had already invested £426 million in the UK and established over 13,000 out-of-home delivery points. Looking ahead, it plans to add 5,000 more APM units in 2025.

Source: Reuters

My Perspective: As I’ve previously discussed with companies like Amazon, Mercado Libre, and Sea Limited, building a logistics moat requires significant investment—exactly what InPost is doing. These early investments are already yielding results: parcel deliveries in the UK doubled in 2024 to 93.2 million, showcasing the growing demand for InPost’s services.

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The Chat is a space designed to facilitate, real-time discussions, share knowledge and debate ideas with fellow investors. Join the conversation.

If you found today's edition helpful, please consider sharing it with your friends and colleagues on social media or via email. Your support helps to continue to provide this newsletter for FREE!

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Happy investing

Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Uber Share Repurchase Program and New Partnerships

2. InPost Q4 2024 Trading Update

3. Evolution CFO Transition

4. Auto Partner December 2024 Sales Update

5. Adyen Launches Uplift

1. Uber (UBER)

$1.5 Billion Accelerated Share Repurchase Program

Uber has announced an accelerated share repurchase (ASR) agreement to buy back $1.5 billion of its common stock, as part of its previously announced $7.0 billion share repurchase authorisation.

Under the agreement, Uber will initially receive 18,578,727 shares, representing approximately 80% of the expected repurchases. The final number of shares repurchased will be determined by the volume-weighted average price of Uber stock during specified dates in Q1 2025, less a discount.

Source: Uber IR

My Perspective: Management's decision signals confidence in Uber's stock being undervalued relative to the strength of its business. The ASR represents a value-accretive use of capital, retiring shares equivalent to over 1% of Uber's market capitalization. This move enhances shareholder value.

Partnership with NVIDIA to Accelerate Autonomous Mobility

Uber and NVIDIA have partnered to accelerate the development of AI-powered autonomous driving technology, leveraging their respective expertise in data, computing power, and AI innovation.

• Uber's Contribution: Data from 32 million daily trips to inform and refine autonomous driving systems.

• NVIDIA's Contribution: Cutting-edge platforms, including:

  • NVIDIA Cosmos™: A platform for developing physical AI systems, like robots and autonomous vehicles, with tools to reduce costs and democratize access to AI development.

  • NVIDIA DGX™ Cloud: A high-performance AI platform offering scalable tools for multi-cloud environments.

Source: Uber IR

My Perspective: Uber's unrivalled data reserves position it as a key player in autonomous mobility. NVIDIA CEO Jensen Huang clearly recognizes this advantage.

The partnership offers strategic benefits for both companies:

• Uber: Accelerated progress toward safe, scalable autonomous driving solutions.

• NVIDIA: Expansion of its AI platforms into the mobility ecosystem, reinforcing its leadership in autonomous vehicle development.

Uber Becomes Delta Airlines Exclusive Rideshare Partner

Delta Air Lines has ended its eight-year partnership with Lyft, choosing Uber as its exclusive rideshare partner and linking its SkyMiles loyalty program to Uber starting this spring. Customers can now earn Delta SkyMiles through Uber rides and Uber Eats orders, enhancing travel and dining rewards.

The partnership aligns seamlessly with American Express, which already offers Uber-related credits to its cardholders.

Recent Uber features improving airport travel include:

• Uber Shuttle: Budget-friendly rides to LaGuardia Airport.

• UberXXL: Extra trunk space for travelers with additional luggage.

• Flight Capture: A feature on Uber Reserve to ensure timely airport arrivals.

• UberX Share at Airports: A shared ride option saving up to 25% compared to UberX.

Source: Uber Newsroom

My Perspective: Delta’s switch from Lyft to Uber likely reflects Uber’s broader platform and global reach. Lyft reported 24.4 million active riders and 216 million rides in Q3 2024, while Uber had 161 million monthly active users and 2.8 billion rides in the same period. This is a clear win for Uber, reinforcing its dominance in the mobility sector.

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2. InPost (INPST) Q4 2024 Trading Update

InPost achieved record-breaking volumes of over 1 billion parcels in 2024, a 22% year-over-year (YoY) increase, significantly outperforming e-commerce market growth in Poland, France, and the UK.

In Q4 2024, the company handled 322.1 million parcels, reflecting a 20% YoY increase, with a record peak day of nearly 14 million parcels in the lead-up to Christmas.

Poland

• Delivered 709.3 million parcels in 2024, representing 20% YoY growth.

• Q4 volumes reached 209.9 million parcels, exceeding expectations due to guaranteed pre-Christmas delivery and high logistics quality.

Mondial Relay (France)

• Delivered 266.6 million parcels in 2024, marking an 11% YoY increase.

• Growth was primarily driven by the B2C segment (+26% YoY), with diversification away from C2C.

• Automated Parcel Machine (APM) volumes surged by an impressive 103% YoY, enhancing operational efficiency.

UK

• Delivered 93.2 million parcels in 2024, doubling volumes from 2023.

• Q4 volumes totaled 27.2 million parcels, a 58% YoY increase, driven by rapid network expansion and improved logistics.

• The UK network is operating at over 100% capacity, signalling significant potential for further APM deployment.

Source: InPost IR

My Perspective: This trading update, while not a full earnings report, reflects strong performance across KPIs. Parcel volumes continue to grow at a 20% YoY rate, exceeding management's expectations. In Q3, management had guided for high-teens volume growth in Q4, comprising mid-teens growth in Poland and 20% growth outside Poland.

In 2024, InPost deployed a record 11,528 APMs, bringing the total network density to 46,977. With 25,269 APMs in Poland, 64% of the population is now within a seven-minute walk, and in cities, this figure rises to 90%.

We are beginning to see scale and network effects take hold, as InPost's ability to deploy more APMs than any competitor further strengthens its position. As volumes grow, InPost enhances its network density and operational efficiency, solidifying its competitive edge.

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3. Evolution (EVO) CFO Transition

Jacob Kaplan, Evolution’s CFO since 2016, is stepping down but will remain in an advisory role during the transition. Joakim Andersson will take over as CFO on February 18, 2025. Andersson brings extensive CFO experience from listed companies and private equity, including Kinnevik AB, Cint Group AB, and Slättö. However, this is his first role in the gaming and live casino industry.

CEO Martin Carlesund praised Kaplan’s contributions to Evolution’s growth and framed Andersson’s appointment as a step toward the company’s continued development.

Source: Evolution IR

My Perspective: The announcement initially raised questions about whether Kaplan’s departure stemmed from internal issues or personal reasons. However, in a subsequent interview with a Swedish newspaper, Carlesund clarified:

“We’ve searched long and hard. We agree that we needed to find the right replacement before making any changes. So this has been in the works for a while.”

From my perspective as someone with an accounting and finance background, I don’t view the CFO role at Evolution as pivotal compared to other industries. I’d be far more concerned if Chief Product Officer Todd Haushalter were to leave, given his critical role in Evolution's product innovation.

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4. Auto Partner (APR.WA) December 2024 Sales Update

Auto Partner reported December 2024 revenue of PLN 237.0 million, reflecting a 5.6% YoY increase. On a cumulative basis, 2024 year-to-date revenue stands at PLN 4.11 billion, representing a 12.6% YoY increase.

Source: Bankier

My Perspective: This update marks the end of a disappointing year for Auto Partner. While margins were expected to face challenges in 2024, growth has also slowed sequentially throughout the year, declining from 19% in Q1 to just 8% in Q4. While we await the full earnings review, 2025 will be pivotal as Auto Partner begins to lap lower comparatives

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5. Adyen (ADYEN) Launches Uplift

Adyen has launched Adyen Uplift, an AI-powered payment optimization suite designed to:

• Increase payment conversion rates

• Simplify fraud management

• Reduce payment costs

Uplift leverages Adyen’s global transaction dataset (over $1 trillion worth of payments data) for real-time optimization. Businesses benefit from tailored performance recommendations and the ability to test different payment configurations, enhancing payment funnel efficiency by balancing conversion, fraud prevention, and cost reduction.

Early pilot results demonstrated up to a 6% increase in payment conversion rates. Key customer outcomes include:

• On: Achieved a 2% increase in conversion rates.

• Nord Security: Improved conversion rates on customer-initiated transactions by 10%, while effectively controlling fraud and costs.

Uplift also automates fraud control using AI, significantly reducing reliance on manual rules. Pilot participants:

• Reduced manual risk rules by 86%, with 35% eliminating them entirely.

• Improved fraud detection accuracy while minimizing false positives.

Cost optimization is another critical benefit. Uplift helps businesses lower payment processing costs by up to 5%. AI-driven routing identifies the most cost-effective transaction paths and tailors checkout flows for maximum efficiency.

Source: Adyen IR

My Perspective: I’ve previously highlighted that Adyen is building a remarkable data repository, which holds immense value for merchants. The launch of Uplift demonstrates the first formal solution leveraging this data. By combining AI-driven automation, fraud mitigation, and cost optimization, Uplift addresses critical pain points in payment management. This launch further solidifies Adyen’s position as a leader in transforming payment processes into a strategic advantage for businesses.

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Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

This will be the last newsletter edition before Christmas, so I’d like to take this opportunity to wish you all a very Merry Christmas and thank you for your continued support, especially over the past year.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Nubank Invests $150 million in Tyme Group

2. Adyen Expands Partnership with Affirm

3. Mercado Libre eMarketer Data Drop

4. Sea Limited Shopee Reports 4x Increase During 12.12 Sale

5. InPost Partners with Aldi to Trial Parcel Lockers

6. Evolution Faces UK Gambling Commission Review

1. Nubank (NU) Invests $150 million in Tyme Group

Nubank has announced an investment of $150 million in Tyme Group, leading its Series D funding round. The total round amounted to $250 million, with the M&G Catalyst Fund contributing $50 million and existing shareholders adding another $50 million.

Tyme Group is a fast-growing digital bank with 15 million customers across South Africa and the Philippines. It operates under a hybrid model, combining digital platforms with physical touchpoints (such as kiosks and ambassadors) to better serve emerging markets. The company plans to expand further, leveraging its Singapore headquarters and Vietnam development hub, with Vietnam as its next operational target.

Source: Nubank IR

My Perspective: This is not Nubank’s first investment in another neobank. In 2021, it invested $45 million in the Indian equivalent, Jupiter. As an investor, Nubank brings valuable expertise from scaling its own digital banking model to hundreds of millions of customers globally. Tyme Group stands to benefit not only financially but also from Nubank’s business counsel and insights.

2. Adyen (ADYEN) Expands Partnership with Affirm

Affirm Holdings has deepened its collaboration with Adyen, becoming the first Buy Now, Pay Later (BNPL) provider to support Adyen for Platforms—a comprehensive payment solution tailored for platform businesses like peer-to-peer marketplaces and on-demand services.

Adyen merchants in Canada now have access to Affirm’s extended offerings, including monthly installment plans alongside existing biweekly payment options. Affirm enables consumers to customize payment plans ranging from six weeks to 36 months, with options as low as 0% APR, and no hidden or late fees.

The Affirm-Adyen partnership has experienced rapid growth, with average annual payment volume increasing more than sevenfold between 2021 and 2023. Adyen highlights the potential of embedded payment solutions, estimating a $185 billion market opportunity for SaaS platforms based on research conducted with Boston Consulting Group.

Source: Adyen IR

My Perspective: The expanded partnership enhances Affirm’s reach and strengthens Adyen’s platform capabilities, empowering merchants with innovative payment solutions. Adyen’s focus on delivering top-tier payment experiences positions this collaboration as a key driver for greater flexibility and growth for global merchants and their customers.

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3. Mercado Libre (MELI) eMarketer Data Drop

eMarketer recently published an in-depth analysis of 25 years of Mercado Libre data in Latin America. As many readers know, Mercado Libre is the largest e-commerce platform in the region, achieving over $50 billion in sales in 2024.

By 2026, the platform is projected to account for 30% of all online spending in the region, up from less than 25% in 2022. The company continues to invest billions into its e-commerce and fintech businesses, reinforcing its leadership position across all Latin American markets where it operates.

Source: eMarketer

My Perspective: While Mercado Libre’s stock has faced pressure recently due to Brazil’s economic challenges, this report highlights the company’s long-term growth potential. Over the past 25 years, Mercado Libre has consistently driven economic growth, financial inclusion, and digital transformation in Latin America—and it is well-positioned to continue leading these trends.

4. Sea Limited (SE) Shopee Reports 4x Increase During 12.12 Sale

Shopee reported a fourfold increase in orders and a fivefold surge in sales for Filipino sellers, showcasing the platform's success in driving significant growth for local brands and MSMEs. The sale reinforced Shopee's position as the leading online shopping destination in the Philippines during the holiday season.

Shopee engagement through interactive tools was particularly strong:

• Shopee Video: This short-form content feature drove a 14x increase in checkouts during the campaign.

• Shopee Live: Real-time interactions led to a 6x increase in checkouts and a 3x rise in viewership, demonstrating its effectiveness in boosting sales.

• Shopee Affiliate Program: This initiative enabled a fourfold increase in orders through affiliates, empowering Filipino content creators to promote local products and brands effectively.

Source: Manila Standard

My Perspective: Shopee is estimated to hold a 46% share of the e-commerce market in the Philippines as of the end of 2023. Achieving a fourfold increase in orders and a fivefold surge in sales is quite remarkable given its already dominant market position.

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5. InPost (INPST) Partners with Aldi to Trial Parcel Lockers

Aldi is collaborating with InPost to trial parcel lockers at 22 UK stores, allowing customers to collect and return online orders while shopping. This initiative aims to enhance customer convenience by integrating parcel services into the shopping experience, accessible via QR codes. The trial is set to run for 12 weeks, with potential expansion to more locations depending on its success.

Source: Aldi Press Centre

My Perspective: This trial represents an important step for InPost as it continues its rapid expansion in the UK. If successful, the partnership could scale up to over 1,000 Aldi stores across the UK, significantly increasing access to InPost's parcel lockers.

6. Evolution (EVO) Faces UK Gambling Commission Review

The UK Gambling Commission (GC) is reviewing Evolution's operating licence due to its games being provided to unlicensed operators in the UK. Potential outcomes range from no penalty to financial sanctions or even suspension/revocation of its UK licence.

Evolution has responded by removing its games from the illegal website and is cooperating fully with the GC. CEO Martin Carlesund stated that the company is using technical tools to ensure its games are accessible only via licensed operators in the UK. Evolution emphasised its commitment to supporting the licensed UK market and preventing unlicensed activities.

The review follows reports that Evolution provided services to unlicensed Asia-based operators, some linked to UK Premier League teams. Asia accounts for approximately 40% of Evolution’s revenue, but the share of regulated revenue has slightly declined to 39%. Growth in Asia has faced challenges, including increased scrutiny, cyber-attacks, and questions about operations in unregulated markets.

Source: iGamingBusiness

My Perspective: The UK market represents only 3% of Evolution’s revenue, limiting the potential financial impact of enforcement action. However, ongoing scrutiny in Asia could present broader challenges for Evolution’s operations. That said, stricter enforcement across regions could also create opportunities, as Evolution is one of the most compliant suppliers in the market despite its significant revenue from unregulated markets.

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Happy investing

Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Nubank Partnership with Puntored in Colombia

2. NIO November 2024 Delivery Update

3. Adyen 3 New Partnerships

4. Sea Limited Vietnam Bans Temu and Shein

5. InPost Extends Partnership With Newcastle United

6. Auto Partner November Sales Update

1. Nubank (NU) Partnership with Puntored in Colombia

Nu Colombia has partnered with Puntored to enable free cash deposits into Nu accounts at over 15,000 locations nationwide, covering 100% of Colombian municipalities.

Puntored specializes in providing financial services to underbanked individuals in rural and isolated areas, aligning with Nu’s mission to increase accessibility to banking services.

This collaboration strengthens Nu's position as a transactional account provider through the integration of new features:

• Cash Deposits: Free deposits via Puntored’s network.

• PSE Payments: Integration with Colombia's electronic payment system.

• Nu Placa: A unique identifier for instant, secure, and private account transfers.

Source: Latam List

My Perspective: This partnership establishes Puntored as Nu’s first banking correspondent in Colombia and mirrors its expansion strategy in Mexico, where it recently partnered with FINABIEN to enhance financial accessibility. Despite entering Colombia in 2020, Nubank has already reached 2 million customers, underscoring its rapid growth trajectory.

2. NIO (NIO) November 2024 Delivery Update

NIO delivered 20,575 vehicles in November 2024, a 29% increase compared to November 2023. With one month remaining in Q4, NIO's deliveries total 41,551 vehicles. As of November 30, 2024, the company has delivered a cumulative 640,426 vehicles.

Source: NIO IR

My Perspective: NIO’s Q4 guidance, issued during the Q3 earnings release, projected deliveries of 72,000 to 75,000 vehicles. To meet this, December deliveries would need to range between 30,449 and 33,449—a highly ambitious target that seems increasingly unlikely to materialize.

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3. Adyen (ADYEN) 3 New Partnerships

Doctolib

Adyen and Doctolib, a leader in European digital healthcare, have partnered to deliver innovative financial services for medical professionals. The collaboration began in France and Italy, with plans to expand into Germany and other European countries.

Doctolib will use Adyen's payment solutions to offer online payment systems and embedded financial products, streamlining financial management for medical professionals. This reduces administrative burdens, enabling them to focus more on patient care. Patients can save payment methods in the Doctolib app, making payments for consultations seamless and reducing reliance on cash or physical cards.

Source: Adyen IR

My Perspective: Adyen’s Europe-exclusive data centres, meeting Doctolib’s strict data protection standards, stood out as a key advantage—a unique selling point I hadn’t previously considered.

Tripla

Adyen has partnered with Tripla, a Tokyo-based hotel solutions provider, to enhance payment processing for accommodation facilities using Tripla’s ‘tripla Book’ reservation engine.

Through Adyen’s single platform, Tripla will manage advance payments for room reservations and cancellation fees via credit card. The platform consolidates domestic and international payment data while supporting multi-currency transactions.

The ‘tripla Book’ reservation engine simplifies bookings to as few as two steps and supports advance payments. Guests benefit from real-time optimal exchange rates for multi-currency payments.

Additionally, Tripla’s ‘tripla Pay’ feature offers a “Pay by Link” service to collect cancellation fees, addressing the issue of unauthorized cancellations.

Source: Adyen IR

My Perspective: Adyen and Tripla are well-positioned to capitalize on the growing inbound travel demand in Japan and the broader Asia-Pacific region. By offering innovative payment solutions, the partnership aims to enhance customer experiences, reduce financial risks for hotels, and support the global expansion of Japanese accommodation facilities.

Intuit

Intuit Inc. and Adyen have partnered to integrate Adyen’s embedded payment services into Intuit’s QuickBooks Online, targeting the UK market. This partnership aims to simplify electronic payments for small and mid-sized businesses (SMBs).

UK SMBs lose an average of £22,000 annually to late payments, contributing to 50,000 business closures each year. Faster payments could boost the UK economy by £2.5 billion annually. Adyen’s UK banking license and real-time payment rails (Faster Payments Service) will help SMBs receive funds faster, improving cash flow stability.

Adyen’s integration automates financial processes, reducing manual errors and simplifying accounts receivable tracking. SMBs can offer customers diverse payment methods, including bank transfers and card payments, reducing friction. Real-time insights into revenue and cash flow further streamline bookkeeping and financial management.

Source: Adyen IR

My Perspective: Intuit QuickBooks serves 6.5 million subscribers globally and processes 2.9 million invoices monthly in the UK, making this a significant win for Adyen. It also sets the stage for future innovations in embedded financial services, solidifying both companies’ positions in the SMB-focused fintech space.

4. Sea Limited (SE) Vietnam Bans Temu and Shein

Vietnam has suspended the operations of Chinese online retailers Temu and Shein after they missed the government’s deadline to register their operations by the end of November.

Temu has submitted registration documents, which are under review, but the timeline for resuming operations remains unclear. Similarly, Shein is working on registration, but its Vietnamese website is currently unavailable. Customers can, however, still shop through Shein’s international platform.

Authorities are concerned about the impact of foreign platforms’ deep discounting on domestic businesses and the potential sale of counterfeit goods.

Recently, Vietnam’s parliament passed legal changes requiring foreign e-commerce platforms to pay VAT and eliminating tax exemptions for low-cost imported goods, which had benefited platforms like Temu and Shein. These measures aim to level the playing field for local businesses and increase tax revenues.

Source: Reuters

My Perspective: These suspensions and new tax requirements will undoubtedly disrupt the business models of foreign e-commerce platforms in Vietnam. This should directly benefit Shopee, which already holds over two-thirds of the e-commerce market share in the country.

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5. InPost (INPST) Extends Partnership With Newcastle United

Newcastle United and InPost have extended their partnership after a successful first year marked by innovative community initiatives.

Notably, InPost installed custom parcel lockers at St. James’s Park, the first at a Premier League stadium. These lockers enhance Newcastle United’s e-commerce offerings, allowing fans to receive online deliveries conveniently at any UK locker.

Source: Newcastle United

My Perspective: This partnership highlights the mutual growth ambitions and shared values of both organizations. For InPost, rapidly scaling in the UK, such collaborations are crucial for building brand recognition and fostering community connections.

6. Auto Partner (APR.WA) November Sales Update

Auto Partner reported November 2024 revenue of PLN 340.3 million, reflecting a 5% year-over-year increase. On a cumulative basis, 2024 year-to-date revenue stands at PLN 3.84 billion, representing a 13% YoY increase.

Source: Bankier

My Perspective: Auto Partner’s monthly sales continue to exhibit variability. For instance, October’s sales growth was 14%, compared to just 5% in November. While these updates provide useful insights, investors should prioritise the long-term trend over fluctuations in monthly performance.

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The Chat is a space designed to facilitate, real-time discussions, share knowledge and debate ideas with fellow investors. Join the conversation.

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Happy investing

Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Nubank Becomes Brazils Top Bank

2. Evolution October U.S iGaming Market Growth

3. NIO Q3 2024 Earnings

4. InPost Launches Locker Shops in the UK

5. Adyen Launches Tap to Pay in New Zealand

1. Nubank (NU) Becomes Brazils Top Bank

Nubank has surpassed Banco do Brasil, the nation's oldest bank, to become Brazil's leading main bank provider. As of November 2024, it boasts 100 million customers and a 20% market share. Over half of Brazilian adults use Nubank, and 20 million consider it their primary bank. This milestone makes Nubank the first digital-only bank in the world to achieve such dominance, underscoring the transformative impact of fintech on traditional banking.

Source: Global Data

My Perspective: This development should come as no surprise to regular readers, as Nubank's rise has been a recurring theme in my analysis. Its ascent highlights the challenges legacy banks face in adapting to shifting consumer preferences and the disruptive potential of fintech. A key driver of this shift in Brazil has been improved digital experiences, cited by 35% of bank switchers and an impressive 47% of those moving to Nubank.

2. Evolution (EVO) October U.S iGaming Market Growth

Pennsylvania

The Pennsylvania iGaming sector grew significantly, with revenue increasing 22.1% year-over-year (YoY) to $189.1 million, just 1.1% below the record $191.1 million achieved in March.

New Jersey

New Jersey iGaming revenue hit $213.6 million, marking a 28.1% YoY increase and a 2.8% rise from the previous record of $208.1 million in September.

Michigan

Michigan's iGaming market achieved a record-breaking $215.5 million in revenue, surpassing its previous high by 2.4%. This represented YoY growth of 37.7% and an 8.9% increase from September, demonstrating strong momentum.

Source: CDC Gaming

My Perspective: The U.S. iGaming market continues to demonstrate robust growth, presenting significant opportunities for Evolution. With no signs of slowing down, this market remains a key driver for the company.

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3. NIO (NIO) Q3 2024 Earnings

Deliveries

Vehicle deliveries reached a record 61,855 units, marking a 12% year-over-year (YoY) increase and an 8% rise from Q2 2024. This solidifies NIO’s position with over 40% of China’s battery electric vehicle market for vehicles priced above RMB 300,000 ($42,350).

October deliveries reached 20,976 vehicles, suggesting another record-breaking quarter ahead, with expanding market share.

Revenue

Total revenues were $2.66 billion, reflecting a 2% YoY decrease but a 7% quarter-over-quarter (QoQ) increase. Vehicle sales, comprising 89% of total revenue, amounted to $2.40 billion, down 4% YoY but up 7% QoQ.

The YoY revenue decline was primarily driven by a lower Average Selling Price (ASP) due to changes in the product mix, partially offset by increased delivery volume. As I’ve highlighted previously, the EV price war in China remains a significant concern. Although NIO’s ASP remained consistent QoQ, it declined by 11% YoY, meaning that despite selling more cars, revenue growth was constrained.

Profitability

Gross margin improved to 10.7%, up from 8.0% in Q3 2023 and 9.7% in Q2 2024. This improvement was mainly due to higher vehicle margins, which increased to 13.1% from 11.0% YoY and 12.2% QoQ.

The higher vehicle margin resulted from reduced material costs per unit, partially offset by the decline in ASP discussed above.
Despite these improvements, net losses rose 11% YoY to $721 million.

Guidance

For Q4 2024, management expects:

• Vehicle deliveries between 72,000 and 75,000 units, representing 44%-50% YoY growth.

• Total revenues between $2.80 billion and $2.90 billion, a 15%-19% YoY increase.

Assuming 89% of revenue comes from vehicle sales, guidance suggests that the ASP will drop to around $35,000, representing a 10% QoQ and 20% YoY decline.

Source: NIO IR

My Perspective: The positives in this report include record vehicle deliveries and improved vehicle gross margins. However, ASP pressures remain a key challenge, significantly impacting revenue despite higher delivery volumes.

While YoY gross margin gains were achieved through faster cost reductions, this trend may reverse as ASPs continue to decline. With Q4 guidance indicating a potential 20% YoY ASP drop, margin pressures could intensify.

Although the EV sector has favorable tailwinds, it remains uncertain whether NIO can achieve the necessary scale and profitability to deliver sustainable value for shareholders.

4. InPost (INPST) Launches Locker Shops in the UK

InPost is accelerating its UK expansion with the launch of new Locker Shops in high-demand urban areas. Following the success of its Camden Locker Shop pilot in April 2024, which demonstrated strong consumer engagement and validated the concept of dedicated stores with multiple locker compartments, InPost is rolling out additional locations.

The next sites will include London’s Liverpool Street and London Bridge in late 2024, with further expansion to Manchester and additional London locations planned for 2025.

Source: Retail Technology Innovation Hub

My Perspective: InPost’s Locker Shops target hyper-urban areas to meet rising demand for its parcel locker network, providing convenient out-of-home delivery and return options. With over 8,400 lockers in the UK and increasing consumer adoption, this strategic rollout reinforces InPost’s leadership in the out-of-home delivery market.

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5. Adyen (ADYEN) Launches Tap to Pay in New Zealand

Adyen has introduced Apple’s Tap to Pay on iPhone in New Zealand, partnering with NewStore to enable retailer customers like Lorna Jane and R.M. Williams to accept contactless payments using only an iPhone and a supporting iOS app—eliminating the need for additional hardware.

Merchants can now accept all contactless payments, including credit/debit cards, Apple Pay, and digital wallets, through NFC technology. Payments can be processed anywhere on the store floor, enhancing customer interactions and improving checkout efficiency. This mobile-first setup reduces reliance on hardware like payment terminals, streamlining workflows during high-traffic periods and events.

Source: Adyen IR

My Perspective: The continued global rollout of this technology aligns with Adyen’s commitment to driving digital payment innovation. By offering flexibility and scalability, it enables businesses to provide seamless shopping experiences that enhance customer satisfaction and boost brand loyalty. It’s a win-win for merchants and end customers alike.

If you'd like to support the work of an independent analyst, you can buy me a coffee. The proceeds will contribute to covering the annual running costs of the newsletter.

Buy me a coffee

Join the community of informed investors – subscribe now to receive the latest content straight to your inbox each week and never miss out on valuable investment insights.

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The Chat is a space designed to facilitate, real-time discussions, share knowledge and debate ideas with fellow investors. Join the conversation.

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Happy investing

Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Earlier this week, we launched the new Community Chat feature, and it’s already proving valuable to our members. For example, we recently heard from an investor based in Poland who shared that InPost is being used to send luggage on domestic flights, as it's significantly cheaper than checking bags directly onto the plane. This is a use case I hadn’t considered before and wouldn’t have discovered without the community.

You can join the conversation below.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Mercado Libre Consumer Trends in Argentina & Colombia Digital Wallet

2. Nubank Expands Nu Limite Garantido

3. InPost Gemius Market Data & Opening Largest Logistics Hub in Poland

4. Evolution Digital Industry Supplier of the Year

5. Meta Instagram is the Most Used Social Media App

6. Auto Partner September Sales Update

1. MercadoLibre (MELI)

Consumer Trends Report in Argentina

MercadoLibre reviewed consumption trends on its platform in Argentina to analyze user behavior during a year of significant economic transition. The company shared the results in a report this week. Key insights include:

• After a decline in the early months of 2024, consumption has been steadily recovering since May.

  This recovery is evident in both the growth of products sold on the platform and the total transaction volume in dollars. In August, MercadoLibre reached a historic record with 20 million products sold, amounting to $916 million.

• More people are buying, and more SMEs are selling on MercadoLibre.

  From January to September, over 1.5 million new buyers and 28,000 new sellers joined the platform. Additionally, in the first nine months of the year, sellers increased their average number of units sold by 30%.

• The availability of credit is growing on both MercadoLibre and MercadoPago.

  The credit portfolio, which includes consumer financing and working capital for sellers on the platform, grew by 69% year-on-year in September, measured in dollars. That month, 11.5 million consumer loans were granted to more than 4.1 million people, representing a 40% increase over the same period last year.

• The end of the rental law and an uptick in mortgage credit revitalized a previously stagnant real estate sector.

  From December 2023 to September 2024, the supply of rental properties tripled. In the Greater Buenos Aires Area, over 20,000 houses and apartments are now available on MercadoLibre’s real estate section. The demand for houses and apartments for sale increased by more than 43% between July and September 2024, compared to the same period in 2023.

• More users are looking to buy vehicles on MercadoLibre.

  After a slow start to the year, interest in vehicle purchases began picking up in June, with a 10% year-on-year increase in the number of users contacting sellers by September.

Source: Mercado Libre

My Perspective: These indicators suggest the beginning of an economic recovery in Argentina’s consumption patterns. Another key takeaway is the vast amount of economic data that MercadoLibre possesses, which will become increasingly valuable as advances in AI continue. To truly benefit from AI, a company needs to collect and own large volumes of data—something MercadoLibre clearly excels at.

Mercado Pago Launches new Digital Wallet in Colombia

MercadoPago is launching a new digital wallet in Colombia starting in October, aiming to strengthen its position in the country’s fintech sector. The wallet will allow users to recharge balances via Pago Seguro en Línea (PSE), use it at partner stores, and access exclusive discounts. Users will also be able to link credit and debit cards from any local bank, track expenses, and reinvest balances on MercadoLibre or at other affiliated stores.

Source: LatAm Fintech

My Perspective: With this move, which has already been implemented in Mexico and Argentina, MercadoPago is positioning itself as a key player in Colombia’s digital payment ecosystem. The app has already been downloaded more than 600,000 times in the country.

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2. Nubank (NU)

Expansion of Nu Limite Garantido Feature

Nubank has expanded its Nu Limite Garantido feature, allowing clients to use Tesouro Direto (Brazilian government bonds) held with Nubank as collateral to increase their credit card limits.

Initially launched in 2023, Nu Limite Garantido enabled customers to boost their credit limits using investments held with Nubank, previously limited to a dedicated savings product called Caixinha, which yields 100% of the CDI (Interbank Deposit Certificate).

This feature allows customers to increase their purchasing power while keeping their money invested and earning returns. With a few clicks, clients can select the amount of government bonds to convert into an additional credit limit.

Currently, over 6.7 million customers use Nu Limite Garantido through Caixinha, and the maximum combined credit limit (pre-approved and Nu Limite Garantido) is set at R$150,000.

Source: Nubank

My Perspective: This expansion is a win-win for customers, offering more credit flexibility while promoting the use of Nubank’s investment products. It should also continue to strengthen Nubank’s competitive position.

3. InPost (INPST)

Gemius 2024 Report

The latest Gemius 2024 data reaffirms InPost’s strong presence in the Polish logistics market, where it dominates both the parcel locker and door-to-door delivery segments. Key insights include:

• InPost holds an 88% market share for deliveries to parcel machines and 45% in door-to-door deliveries in Poland, leading in both categories.

• Parcel machines are the preferred option for online shopping deliveries (81%) and returns (36%), with InPost’s Paczkomat dominating both (88% for deliveries and 82% for returns).

• Important factors for customers include proximity of parcel machines (84%), the ability to track parcels (83%), and weekend delivery options (73%).

• Innovations like InPost's mobile app (with 13 million users), contactless parcel locker opening, and label-free shipping have distinguished it from competitors.

• A large majority (93%) of InPost customers use the contactless delivery option.

Source: ISB

My Perspective: Third-party data like this is crucial for validating an investment thesis. The Gemius report provides strong support for InPost shareholders, highlighting its market dominance and innovation.

Opening Largest Logistics Hub in Poland

InPost has opened the largest logistics hub in Poland, located in Wola Bykowska near Warsaw and Łódź. The facility, spanning 36,000 square meters, can handle up to 85,000 packages per hour, underscoring InPost’s rapid growth and expanding logistics capabilities.

This new center is double the size of the existing facility, which opened in 2016, and reflects the significant increase in demand for logistics services in Poland. InPost is now the second-largest operator in the country in terms of warehouse and logistics space.

Source: Manager+

My Perspective: Building a competitive moat takes time and investment, and that's exactly what InPost is doing. By the end of Q2 2024, InPost had over 73,000 out-of-home points across nine countries, including more than 40,000 parcel machines and nearly 33,000 PUDO points. This extensive network positions InPost as a leader in out-of-home delivery solutions across Europe.

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4. Evolution (EVO)

Digital Industry Supplier of the Year

The eleventh annual Global Gaming Awards Americas took place at The Venetian Las Vegas, hosted by Today Gaming America and Gambling Insider. These prestigious awards recognize outstanding companies and individuals in the gaming industry. Winners were selected through a rigorous shortlisting and voting process by 100 senior industry executives with extensive experience in the Americas.

Evolution was crowned Digital Industry Supplier of the Year and also earned second place for Digital Product of the Year for Crazy Time.

Source: Gaming America

My Perspective: Despite Evolution's market leadership in a growing industry, the company is trading at rock-bottom valuations. Either the market is wrong, or the industry experts are.

5. Meta (META)

Instagram Remains the Most Used Social Media App

Piper Sandler's latest survey of U.S. teenagers shows that Instagram is the most used social media app, with 87% of teens reporting monthly usage—an all-time high. TikTok ranks second at 79%, while Snapchat comes in third at 71%, showing a slight decline. Meanwhile, Facebook—once considered irrelevant by younger generations—is also gaining traction among teens.

Source: Business Insider

My Perspective: Not only has Instagram increased its share of U.S. teen usage from 80% to 87%, but it has also widened the gap over TikTok from 6% to 8%. As I’ve mentioned before, Meta could be one of the biggest beneficiaries of AI, given the vast amount of unique data it possesses. This survey suggests that this data volume is only going to keep growing.

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6. Auto Partner (APR.WA)

September Sales Update

APR reported revenue of PLN 350.95 million for September 2024, a 5.5% YoY increase. Year-to-date revenue through September 2024 has grown by 14%.

Source: Bankier

My Perspective: APR’s monthly sales growth tends to be lumpy, especially in Q3. Revenue grew by 20% in July but slowed to 7% in August and 5.5% in September. Not much more can be interpreted from this data until the company reports Q3 earnings in November.

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Wolf of Harcourt Street

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Email: wolfofharcourtstreet@gmail.com

Before jumping into today’s action-packed edition, I’d like to take a moment to recommend another excellent investing service: Best Anchor Stocks.

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With all that being said, let’s dive into today’s edition!

Todays Agenda

1. InPost Launches Rewards Program & OnTurtle Partnership

2. Sea Limited First Fulfilment Centre in Brazil & Temu Ban

3. NIO September 2024 Delivery Update

4. Airbnb Bookings in Thailand Surge 30%

5. Nubank Nupay Integration on Despegar Travel Platform & Crypto Fee Reduction

6. Evolution Atlantic Lottery Partnership in Canada & First Czech Studio

1. InPost (INPST)

Launch of Loyalty Rewards Program

InPost has introduced a new loyalty program called InCoins, integrated into its InPost mobile app. The program allows users to earn InCoins by completing various tasks related to sending and receiving parcels, as well as using InPost services like InPost Pay and InPost Fresh.

Users can redeem InCoins for rewards, including discounts on InPost services (e.g., 50% off parcel sending or delivery time extensions) and third-party products from brands such as Answear, G2A, and Storytel. Temporary tasks, offering additional points but with usage restrictions, will be made available periodically.

Source: InPost

My Perspective: By gamifying the delivery process, InPost is adopting a strategy similar to how Nubank gamified its banking and credit platforms. This approach makes everyday activities more engaging and enjoyable, boosting customer satisfaction, enhancing engagement, and ultimately driving greater adoption of its services.

OnTurtle Partnership

InPost has partnered with OnTurtle to install parcel lockers at their service stations in La Jonquera and Mercabarna, two strategic locations for goods mobility. InPost has recently expanded its network to over 11,000 collection points across Spain and Portugal, with 9,000 of these locations already operational in Spain.

Source: OnTurtle

My Perspective: OnTurtle operates a network of over 1,700 service stations across 10 European countries. This partnership could be the start of a significant expansion for InPost, especially given OnTurtle’s pan-European presence. Watch this space.

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2. Sea Limited (SE)

Shopee Opens First Fulfilment Centre in Brazil

Shopee has opened its first Fulfilment Centre in São Paulo, Brazil, to improve logistics and enhance the shopping experience on its platform. The new centre will handle storage, packaging, and shipping for selected Brazilian sellers, focusing on electronics, home appliances, and consumer lifestyle products. This initiative aims to simplify operations for sellers, enabling them to concentrate on business growth, while offering consumers faster and more standardised delivery times.

This facility is part of Shopee's broader logistics strategy in Brazil, which includes 11 distribution centres and over 150 logistics hubs across various states. The company utilizes both first-mile and last-mile logistics services and collaborates with a fleet of more than 20,000 partner drivers and over 2,000 Shopee Agency points nationwide. This expansion is expected to boost efficiency, support local entrepreneurs, and increase sales for sellers on the platform.

Source: Bnamericas

My Perspective: Shopee is making significant progress in Brazil, further enhancing the competitiveness of its service offering. As I mentioned last week, Shopee already boasts the lowest churn rate across all of Latin America.

Indonesia Bans Temu

Indonesia will maintain its ban on the e-commerce platform Temu due to concerns that it could disrupt the country’s micro, small, and medium enterprises (MSMEs). Temu is owned by PDD Holdings, the same company that operates Pinduoduo. Indonesian authorities have been closely monitoring Temu's activities and have repeatedly rejected its attempts to enter the local market.

The key reasons for the ban include:

1. Violation of Trade Regulations: Temu’s business model, which sells products directly from factories to consumers, conflicts with Indonesia’s requirement for an intermediary or distributor.

2. Economic and Social Concerns: Indonesia’s Minister of Communications and Informatics, Budi Arie Setiadi, stated that Temu could harm the economy and MSMEs, emphasizing the need for a digital space that benefits society.

3. Previous Rejections: Temu has made multiple attempts to register in Indonesia but has been denied due to regulatory issues and conflicting trademarks.

Source: Channel News Asia

My Perspective: Indonesia previously banned TikTok Shop in 2022 to protect smaller merchants. However, TikTok re-entered the market by acquiring a stake in the Indonesian e-commerce company Tokopedia. This highlights the government’s protective stance towards local businesses and the strict regulatory environment for foreign platforms. The market opportunity is essentially being handed to Shopee and Sea Limited.

3. NIO (NIO)

September 2024 Delivery Update

NIO delivered 21,181 vehicles in September 2024, a 35% increase compared to September 2023. This resulted in Q3 2024 deliveries of 61,885 vehicles, a 12% year-over-year increase and a new quarterly record. As of September 30, 2024, NIO has delivered a cumulative total of 598,875 vehicles.

Source: NIO

My Perspective: This was another strong performance from NIO, with deliveries landing within the management's guidance range of 51,000 to 63,000 units provided last month as part of the Q2 earnings results.

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4. Airbnb (ABNB)

Bookings in Thailand Surge 30%

In the first half of 2024, Airbnb bookings in Thailand surged by over 30% compared to H1 2023, driven by strong growth in group travel (up 40%) and long-term stays (up 20%). Key factors behind this growth include improved connectivity through expanded flight options and streamlined visa policies introduced by the Thai government. Thailand’s appeal for long-term visitors is supported by the introduction of the Destination Thailand Visa, targeting remote workers and digital nomads.

Source: Travel Daily News

My Perspective: Remote workers are more likely to choose Airbnb over hotels, and the company has collaborated with the Tourism Authority of Thailand to promote long-term stays through its “Live and Work in Thailand” initiative. As Thailand’s tourism industry gears up for the high season in Q4, it is well-positioned to maintain this momentum, with Asia being a key growth market for Airbnb given its relatively low penetration compared to other regions.

5. Nubank (NU)

NuPay Integration on Despegar Travel Platform

The partnership between Despegar and Nubank integrates Nubank's payment solution, NuPay, into Despegar's travel platform, bringing mutual strategic benefits:

• Expanded Market Reach for Despegar: Despegar can now access Nubank's 95.5 million Brazilian customers, significantly broadening its target market in Brazil.

• Enhanced Purchasing Power for Nubank Customers: Nubank users can access Despegar’s travel services with increased spending limits and multiple payment options, improving their purchasing experience.

• Improved Payment Process: The integration of NuPay creates a more streamlined payment process, which is expected to boost Despegar's conversion rates.

Source: Business Wire

My Perspective: This collaboration allows both companies to leverage their strengths—Nubank's large user base and Despegar’s extensive travel offerings—creating opportunities for enhanced value and a better overall user experience. It’s a win-win for both parties.

Cryptocurrency Fee Reduction

Nubank has introduced a new fee structure for its cryptocurrency trading platform, Nubank Cripto, which significantly lowers transaction costs for users. The new model reduces the transaction fee to as low as 0.6% per transaction—a 62.5% reduction compared to the 1.6% average fee a year ago, and 25% lower than the 0.8% average fee from March to September 2024.

This fee reduction is a result of operational efficiency improvements throughout 2024, enabling Nubank to pass on cost savings to customers, particularly benefiting high-volume traders. Nubank has also formed partnerships, such as with Talos, to enhance the Nubank Cripto ecosystem. These partnerships enable features like on-chain transfers and better transaction routing, which further optimize costs for users.

Source: Nubank

My Perspective: Nubank emphasizes transparency and sustainability, ensuring that the reduced fees cover operational costs while maintaining a secure, compliant, and user-friendly platform. While cryptocurrency is not a material part of my overall thesis, this is yet another example of Nubank’s commitment to providing competitive, transparent, and accessible financial services.

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6. Evolution (EVO)

Partnership with Atlantic Lottery in Canada

Evolution has formed a partnership with the Atlantic Lottery, making its games accessible to players in three Canadian provinces: New Brunswick, Newfoundland & Labrador, and Nova Scotia. Through this collaboration, players in these regions can now access games from Evolution and its subsidiaries via the Atlantic Lottery's online casino platform.

This agreement positions Evolution as a partner for all regulated provincial lotteries in Canada, complementing its previous deals with the British Columbia Lottery Corporation (BCLC), Alberta Gaming, Liquor and Cannabis (AGLC), Ontario Lottery and Gaming Corporation (OLG), and Loto-Québec. This expanded presence highlights Evolution's growing influence in the Canadian market, which continues to show strong growth potential.

In related news, Evolution also launched its live game show Crazy Time in Michigan, making it available in five U.S. states.

Source: Gambling Insider

My Perspective: This partnership marks a significant milestone for Evolution, completing its product rollout across all regulated provinces in Canada and further advancing its growth in the North American market. With a combined market size of approximately 2.5 million people, Atlantic Lottery represents an important opportunity in the Canadian gaming landscape.

First Live Studio in Czech Republic

Evolution has launched its first live casino studio in the Czech Republic, featuring native Czech-speaking dealers. The new studio, located in the Kajot Intacto land-based casino in Prague, initially offers live roulette and Infinite Blackjack, with plans to introduce more table games such as blackjack, poker, roulette, and baccarat in the coming weeks.

The studio is part of Evolution’s broader strategy to expand in regulated markets and builds on the company's existing presence in the Czech Republic through its online slots portfolio. Gionata La Torre, Evolution's CEO for Europe, emphasized that this launch offers a significant growth opportunity for Czech operators and enhances the player experience through native-speaking dealers, fostering stronger player engagement and loyalty.

Source: Evolution

My Perspective: Given the current uncertainty in Georgia with ongoing workers' strikes, it is encouraging to see Evolution diversify its studio operations into other Eastern European countries. This was a very positive week for Evolution, but you wouldn’t know it by looking at the share price. As I always say, follow the business, not the stock.

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Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Adyen Industry-Defining Solutions & New Partnerships

2. Visa Antitrust Lawsuit

3. Meta Connect 2024 Review

4. Nubank Payroll Loan Expansion & ETF Launch

5. Sea Limited Shopee Offers Next-Day Delivery in Brazil

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1. Adyen (ADYEN) Industry Defining Solutions & New Partnerships

Industry-Defining Solutions

Adyen has announced significant advancements in its in-person payments (IPP) capabilities, reinforcing its position as a leader in payment technology. Key developments include:

• Launch of the SFO1 Terminal: Adyen introduced the SFO1, a proprietary multimedia countertop Android terminal that integrates traditional payment functions with an 8-inch customer-facing screen. This allows merchants to offer customized branding, display rich content, and create dynamic in-store experiences. The terminal aims to transform point-of-sale interactions by integrating seamlessly with POS systems.

• Global Integration of Klarna and Alipay+: Adyen became the first global payment service provider (PSP) to launch Klarna’s in-store solution and initiate a worldwide rollout of Alipay+. This integration enhances Adyen’s unified commerce capabilities, catering to the growing "buy now, pay later" (BNPL) market and attracting global customers, especially from Asia.

• Expansion of Tap to Pay on Android: Adyen is expanding its Tap to Pay on Android solutions to new regions, including Europe, the UAE, Hong Kong, Malaysia, Australia, and New Zealand. This solution transforms NFC-enabled Android devices into secure payment terminals, reducing hardware costs and offering greater flexibility.

Source: Adyen

My Perspective: The launch of the SFO1 reminds me of Apple product launches under Steve Jobs—slick and polished. One criticism of Adyen in the past was that its POS terminals were, frankly, ugly. But if you put an Apple logo on the SFO1, you’d be forgiven for thinking it’s a genuine Apple product.

Partnership with RMS Cloud

Adyen and RMS Cloud have extended their partnership to deliver enhanced operational efficiencies and cost savings for the hospitality industry. RMS Cloud, a leading Australian cloud-based property management solution, serves over 7,000 properties worldwide with its all-in-one platform, which includes tools for channel management, booking, and process streamlining.

Through this renewed partnership, RMS Cloud users benefit from RMS Pay, an integrated payment solution powered by Adyen, which consolidates payments, reconciliation, and reporting. This integration has resulted in significant cost savings (between $50,000 to $200,000 annually), 6X faster payment processing, and a 93% decrease in disputes. The platform has also improved the user experience by enabling contactless check-ins and providing a unified interface for financial management.

Source: Adyen

Partnership with Cinemark

Adyen has partnered with Cinemark, one of the largest theater chains in the U.S., to provide a unified payment solution across its 300+ locations. This collaboration will streamline payments made through Cinemark's website, mobile app, box offices, kiosks, and concessions, as well as premium amenities like in-theater restaurants and the Movie Club subscription program.

Overall, the partnership aims to reduce friction in the movie-going experience and offer a seamless, omnichannel payment solution for Cinemark’s guests.

Source: Adyen

My Perspective: According to my tracker, Adyen has announced 35 partnerships in 2024 so far, and we’re only at the end of September. Just think about all the future processed volume that is waiting to hit Adyen’s earnings in the coming years.

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2. Visa (V) Antitrust Lawsuit

The U.S. Department of Justice has filed an antitrust lawsuit against Visa, alleging that the company unlawfully maintains a monopoly over debit network markets. According to the complaint, Visa controls more than 60% of U.S. debit transactions, generating over $7 billion annually in fees. The lawsuit claims that Visa leverages its dominant position to stifle competition through exclusionary agreements and partnerships that prevent smaller networks or new entrants from gaining a foothold.

Key allegations include:

• Exclusionary Practices: Visa imposes agreements on merchants and banks that penalize them for routing transactions to other debit networks, effectively locking in debit volume and insulating itself from competition.

• Co-opting Competition: Visa offers monetary incentives or imposes punitive fees to convert would-be competitors into partners, limiting potential innovation and reducing competitive pressure.

• Impact on Consumers: The Justice Department argues that Visa’s practices result in higher fees for merchants and banks, which are then passed on to consumers through increased prices or reduced service quality.

The Justice Department is seeking to restore competition in the debit network markets, arguing that Visa’s actions harm not only competitors but also the broader U.S. economy by suppressing innovation and maintaining inflated fees.

Source: U.S. Department of Justice

My Perspective: Visa and Mastercard have been in litigation for nearly two decades over their dominance in the card markets, so this is nothing new. Visa is vowing to vigorously defend itself in court and there are several arguments they could make in their defense:

1. Other major players like Mastercard also operate in the space.

2. Visa’s market share is a result of superior products and services.

3. The widespread acceptance of Visa debit cards provides convenience and flexibility for customers.

4. Their network's efficiency keeps transaction costs low for merchants, potentially leading to lower prices for consumers.

3. Meta (META) Connect 2024 Review

Meta Connect 2024 showcased Meta's strategy to seamlessly integrate AI, AR, and VR technologies into everyday life. Key announcements included:

AI-Powered Chatbots and Assistants: Meta introduced personalized, AI-driven chatbots for platforms like Instagram and WhatsApp, aimed at enhancing user interactions and generating new revenue streams. These AI assistants will support users in navigating virtual and augmented environments, making experiences more intuitive and engaging.

Llama 3.2 Update: The latest Llama update includes lightweight models optimized for mobile and edge devices, along with advanced vision models for enhanced image reasoning. This update positions Llama as a flexible, privacy-focused AI solution suitable for various platforms.

Ray-Ban Smart Glasses: Meta unveiled an upgraded version of its Ray-Ban smart glasses, featuring an improved camera, enhanced voice controls, and deeper AI integration. These glasses are designed to make AR more accessible and useful in everyday scenarios such as content creation and navigation.

Meta Quest 4: The new VR headset offers enhanced resolution, better ergonomics, and expanded functionality beyond gaming. Positioned as a versatile tool for fitness and productivity, it reflects Meta's ambition to broaden VR’s use cases.

Orion AR Glasses: Meta teased its upcoming Orion AR glasses, promising a fully immersive AR experience. This advanced hardware aims to merge the digital and physical worlds seamlessly, setting the stage for broader AR adoption.

AI in the Metaverse: Meta is embedding AI across its platforms to create smarter virtual environments and responsive assistants. The goal is to make the metaverse a space for learning, work, and personal growth.

Source: Meta

My Perspective: The Orion AR glasses were the event’s biggest surprise. While still a few years away from consumer release, they genuinely feel like Meta’s iPhone moment (second Apple reference this week).

Meta is demonstrating how AI, AR, and VR are converging to create more immersive digital experiences. These innovations are part of Meta’s broader strategy to establish a digital ecosystem that blends the real and virtual worlds. Meta clearly wants to dominate the next computing platform—and it’s evident that they’re willing to go to great lengths to achieve this.

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4. Nubank (NU) Payroll Loan Expansion & ETF Launch

Payroll Loan Expansion

Nubank has signed agreements with the states of Rio de Janeiro and Minas Gerais to expand its payroll loan offerings, increasing its total addressable market (TAM) for payroll loans from 50% to 70%. This growth is driven by the addition of these two states to Nubank's existing agreements, which include partnerships with the Brazilian Armed Forces, municipalities such as São Paulo, Rio de Janeiro, and Belo Horizonte, and the state of Paraná. The expanded services will be gradually rolled out through 2025.

Nubank’s fully digital payroll loan service will be accessible to over two million public sector employees, both active and inactive, across Brazil. This expansion targets a significant portion of Brazil’s 11 million public sector workers. Payroll loans have been available to federal employees via SIAPE since March 2023, and the company is also linked with INSS to serve retirees and pensioners.

Source: Nubank

My Perspective: Payroll loans are one of the most attractive lending products for a bank due to their lower risk, as they are backed by the borrower’s salary. This also provides an excellent opportunity for Nubank to cross-sell additional products to these customers.

Launch of ETF

Nu Asset Management, Nubank's investment arm, has launched the Nu Ibovespa B3 BR+ ETF (NBOV11), now available for trading on the B3 stock exchange. This is the first ETF to track the newly developed Ibovespa B3 BR+ index. With a low management fee of 0.10% and T+2 liquidity, the ETF offers cost efficiency and ease of trading. The initial investment starts at R$100.00.

The Ibovespa B3 BR+ index could evolve into a new benchmark for the Brazilian capital market, building on the traditional Ibovespa index. It includes 91 assets and will be rebalanced quarterly. Nubank’s BDR is the second-largest component of the index, with an 8.3% weight.

The launch of NBOV11 aligns with Nu Asset’s commitment to expanding variable income options for investors and developing innovative, transparent, and high-quality investment solutions tailored to market needs.

Source: Nubank

My Perspective: As I’ve mentioned before, Nu Asset Management is allowing Nubank to gradually move up the financial services value chain. Although still relatively small today, with around R$4 billion in assets under management, it has the potential to become a more significant part of the business in the future.

5. Sea Limited (SE) Shopee Offers next-day delivery in Brazil

Shopee has launched same-day and next-day delivery options for São Paulo’s capital and metropolitan region to meet the growing demand for faster shopping experiences. This service covers a wide range of products, including groceries and electronics, and aims to enhance customer satisfaction while supporting local sellers by making their offerings more competitive. Sellers must be located within the covered region and enable the option through Shopee’s Seller Center. Deliveries are handled directly by the sellers.

Logistics remain a critical issue for e-commerce in Brazil, where high costs and slow delivery times in remote areas continue to impact sales. At the E-commerce Brazil Forum 2024, logistics was highlighted as a key factor for improving sales conversion rates and the overall competitiveness of the industry.

Source: Mercado & Consumo

My Perspective: The market is still underestimating Sea Limited despite its stock performance in 2024. Shopee now has the lowest user churn rate across all of Latin America, even lower than Mercado Libre. This improved delivery option should help Shopee maintain its low user churn and further increase its market share.

If you'd like to support the work of an independent analyst, you can buy me a coffee. The proceeds will contribute to covering the annual running costs of the newsletter.

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Happy investing

Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Adyen Can Save Businesses Billions

2. Sea Limited Shopee Forces Competition Out of Vietnam

3. Airbnb Launches Co-Hosting Service

4. Evolution Acquires Arcadia Games Solutions

5. Nubank Stops Nucoin Crypto Trading

6. Visa The Next Tenfold Growth Market

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Starting September 16th, the price of Seeking Alpha Premium will increase to $299. But Wolf of Harcourt Street subscribers can still lock in the current offer of $214/year until October 1st! Plus, you’ll secure a renewal rate of $239 for next year—saving even more. Don’t wait until the price goes up!

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1. Adyen (ADYEN) Can Save Businesses Billions

Adyen published a report titled Strategies to Reduce Your Total Cost of Payments which highlights the potential for enterprise businesses to cut costs and boost revenue through smart payment strategies. Key insights include:

1. Beyond Transaction Fees: Focusing solely on transaction fees can lead to hidden costs. A holistic approach to payment providers can generate significant long-term savings.

2. Interchange and Scheme Fees: Interchange and scheme fees represent 85% of payment costs, but local transactions are up to 59% cheaper than cross-border ones. Optimizing payment routing can reduce costs without impacting authorization rates.

3. Revenue Gains through Innovation: By updating primary account numbers (PANs) and using network tokens, businesses improved authorization rates by 6%, resulting in $7.55 billion in incremental revenue.

4. Offline Transactions: Adyen's Store and Forward solution helped top businesses avoid $42.1 million in losses by preventing offline declined transactions.

5. Faster Checkout: Queue-busting solutions, like mobile POS systems, are critical for improving in-person payment efficiency, where 80% of retail transactions occur.

6. FTE Cost Reduction: Streamlining operations via a centralised payment system can reduce full-time equivalent (FTE) costs by up to 75%, simplifying market expansion and reducing developer workload.

Source: Adyen

My Perspective: This further supports the belief that Adyen's value proposition for customers is exceptionally strong, offering significant benefits by lowering the total cost of ownership for payment processing.

2. Sea Limited (SE) Shopee Forces Competition Out of Vietnam

GoTo Group, an Indonesian ride-hailing and delivery service, announced it will cease operations in Vietnam by September 16 due to intense competition. Gojek, its core unit, first entered Vietnam in 2018 in partnership with Go-Viet, marking GoTo's first international venture. Despite efforts to replicate its Indonesian success, Gojek struggled to compete with dominant players like Grab and ShopeeFood, achieving only a 3% market share in food delivery, compared to Grab's 47% and ShopeeFood's 45%.

Source: Nikkei Asia

My Perspective: Survival of the fittest is in play, and there's more proof that Shopee is one of the winners. In Vietnam's rapidly growing e-commerce market, Shopee commands a dominant 61% market share.

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3. Airbnb (ABNB) Launches Co-Hosting Service

Airbnb plans to introduce a co-hosting service in October that will connect property owners with people willing to manage listings. This service is expected to bring additional supply to the platform. Initially, Airbnb does not plan to monetise the co-hosting service, but may consider it in the future.

Source: MT Newswires

My Perspective: The announcement was made some time ago but seems to be gaining traction now that the launch is less than a month away. I see a couple of key benefits:

1. Supply: By connecting property owners with co-hosts, Airbnb can increase the number of available listings. Owners who were hesitant to list due to management concerns can now participate, unlocking previously untapped inventory.

2. Monetization: In the future, Airbnb could take a cut of co-hosting fees or charge for premium matching services. It might also offer additional tools or resources to co-hosts for a fee, creating a new revenue stream.

4. Evolution (EVO) Acquires Arcadia Games Solutions

Evolution has announced an agreement to acquire Arcadia Gaming Solutions, known for its innovative technology that allows players to engage with physical arcade machines virtually via desktop or mobile devices.

The acquisition involves an initial payment of €2.5 million, with an additional performance-based earn-out set for 2027. The transaction is expected to close in the second half of 2024, pending certain conditions.

Source: Evolution

My Perspective: While I don't know too much about Arcadia Game Solutions, small bolt-on acquisitions like this make sense for Evolution. The acquired company could either be integrated into Evolution’s One-Stop-Shop solution or used to create unique gameplay features that differentiate Evolution's products from competitors.

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5. Nubank (NU) Stops Nucoin Crypto Trading

Nubank announced the termination of crypto trading for its token, Nucoin, to protect users from market volatility. Launched in late 2022 on the Polygon blockchain as part of a customer reward program, Nucoin is now restricted to unlocking benefits within the Nubank ecosystem, such as discounts and exclusive experiences.

Source: Nubank

My Perspective: While Nucoin was never a core part of my investment thesis, I find this move somewhat confusing. Investing in anything, whether stocks or crypto, is inherently volatile, so the explanation doesn’t quite add up for me. Is there something else at play? Definitely one to keep a close eye on.

6. Visa (V) The Next Tenfold Growth Market

Visa is aiming to significantly expand digital payment adoption and financial inclusion in Pakistan. The company plans to increase the number of businesses accepting digital payments tenfold in three years. To achieve this, Visa has partnered with 1Link, a key payment provider in Pakistan, to enhance transaction efficiency and broaden merchant acceptance, especially among smaller businesses.

This collaboration is expected to streamline remittances, which are crucial to Pakistan's economy, making them more secure and efficient. With a large unbanked population and increasing digitization efforts, Visa sees a significant growth opportunity. The recent $7 billion IMF bailout, which includes reforms to boost government revenue and formalize the economy, emphasizes the role of digital payments in promoting transparency. Additionally, the partnership will enable PayPak cards, a local competitor, to be used on Visa’s Cybersource platform for online transactions.

Source: Yahoo Finance

My Perspective: Despite being a $550 billion business, Visa still has an attractive growth potential. Much of this growth will come from emerging markets, which still have large unbanked populations. Take Pakistan, for example. Of the 137 million adults in the country, only 60% have a bank account.

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Wolf of Harcourt Street

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Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. NIO Q2 2024 Earnings

2. Airbnb NYC Local Law Cause Rents to Rise

3. MercadoLibre to Invest $75 million in New Storage Centre

4. Sea Limited Shopee Malaysia to Support 100,000 Entrepreneurs

5. Nubank Lending Practices - Why Wall Street Analysts Wrong

6. Auto Partner August Sales Update

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1. NIO (NIO) Q2 2024 Earnings

NIO reported a report breaking-quarter which was signposted given the company reports monthly delivery figures but very much welcomed after a very disappointing Q1.

Deliveries

Vehicle deliveries reached 57,373 units, marking a 144% year-over-year (YoY) increase and a 91% rise from Q1 2024. This resulted in NIO capturing over 40% of China's battery electric vehicle market priced above RMB 300,000 ($42,350).

July and August deliveries reached 20,498 and 20,176 vehicles, respectively, suggesting another record-breaking quarter in store and expanding market share.

Revenue

Total revenues were $2.40 billion, marking an increase of 99% YoY and 76% quarter-over-quarter (QoQ). Vehicle sales, comprising 90% of total revenue, amounted to $2.16 billion, reflecting an increase of 118% YoY and 87% QoQ. The YoY revenue increase was mainly driven by higher delivery volumes, though partially offset by a lower average selling price due to changes in product mix and user rights adjustments. As I discussed last month, the EV price war in China is a concern and this trend has continued into Q2 as NIO’s vehicle average selling price continues to head south.

Profitability

The overall gross margin improved significantly to 9.7%, up from 1.0% in the same quarter of 2023 and 4.9% in the first quarter of 2024. This increase was driven primarily by a higher vehicle margin, which rose to 12.2% from 6.2% YoY and 9.2% sequentially.

The higher vehicle margin was mainly due to reduced material costs per unit from ongoing cost optimizations. This was partially offset by the lower the average selling price discussed above.

The net loss decreased by 17% YoY to $694 million.

Guidance

For the third quarter of 2024, management expects:

• Vehicle deliveries will range from 61,000 to 63,000 units, marking a growth of about 10% to 14% compared to Q3 2023.

• Total revenues to be between $2.63 billion and $2.71 billion, reflecting an increase of approximately 0.2% to 3.2% from Q3 2023.

If we assume that 90% of NIO’s revenue will come from vehicle sales, the guidance suggests that the average selling price will remain around $38k. Although this is down from $43k in Q3 2023, it will not represent a sequential decline.

On the conference call, management reaffirmed the long-term guidance for 25% vehicle gross margin with monthly deliveries of 30,000-40,000 units.

Source: NIO IR

My Perspective: This was the best quarter NIO has reported in some time, and the market agreed, with shares increasing by 14% after the earnings announcement.

The standout aspect of the report, from my perspective, was not the record vehicle deliveries but rather the improvement in vehicle gross margin. Over the past three years, the average vehicle selling price has dropped by 38%, from $61k in Q2 2021 to $38k in Q2 2024. This decline significantly impacted NIO’s vehicle gross margin, which was 20% in Q2 2021 but fell to as low as 5% in Q1 2023. However, recent efficiency gains and economies of scale have helped NIO lower its average vehicle cost of sales by 30% from $48k to $33k, driving the margin improvement.

Despite the ongoing price war, demand for new-energy vehicles in China continues to grow. In July 2024, sales of these vehicles surpassed those of combustion-engine vehicles for the first time, which should further boost the demand for NIO’s vehicles.

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2. Airbnb (ABNB) NYC Local Law Cause Rents to Rise

The first year of New York City's Local Law 18 (LL18), which introduced stringent short-term rental regulations, has sparked controversy and disappointment regarding its impact on both the housing crisis and tourism. Despite promises to increase housing affordability, the law has reportedly failed to deliver, with rental prices continuing to rise and vacancy rates remaining unchanged.

Hotel rates have surged by 7.4% over the past year in NYC, compared to only a 2.1% rise nationally, pushing travel costs to new highs. This has led to concerns that the city is becoming less accessible to everyday travellers.

Rather than alleviating the housing crisis, rents in New York have risen by 3.4%, reaching a record high in areas like downtown Manhattan, where the median rent hit $5,000 for the first time.

The anticipated boost in housing availability has not materialized. Vacancy rates have remained stagnant at 3.4%, showing no significant improvement despite the crackdown on short-term rentals.

Source: Airbnb Newsroom

My Perspective: Critics, including Airbnb and local business advocates, are urging the city to reconsider LL18. They argue that the law should be amended to support homeowners, increase accommodation supply, and promote economic growth in outer boroughs while addressing the real drivers of the housing crisis by building more homes.

Who could have guessed that reducing supply would cause prices to increase?

3. MercadoLibre (MELI) to Invest $75 million in New Storage Centre

Mercado Libre has announced a $75 million investment to build a new 56,000 square meter storage centre in La Matanza, Buenos Aires, which will double its storage capacity, improve product processing, and reduce delivery times. Developed by Plaza Logística within Mercado Central, the facility will handle 200,000 to over 400,000 products daily, with space for bulky items and more product variety.

The project which is expected to be operational by the end of 2025, will create over 2,300 direct jobs and thousands of indirect ones, helping Argentine SMEs scale their operations. It is part of Mercado Libre’s broader strategy to enhance e-commerce growth, improve the user experience, and expand its business verticals.

Source: Bnamericas

My Perspective: Announcements about infrastructure investments are always positive. This is how building and strengthening a durable competitive advantage takes shape. MELI is developing a best-in-class logistics network that will soon make it impossible for smaller players to compete.

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4. Sea Limited (SE) Shopee Malaysia to Support 100,000 Entrepreneurs

Over 100,000 entrepreneurs joined Shopee Malaysia in 2024, highlighting the increasing role of e-commerce in Malaysia's digital economy. Shopee Live saw a 113% increase in new sellers' live streaming in 2024, emphasising its growing importance in Malaysia's live commerce sector.

Shopee's interactive features, including live streaming, have enabled local entrepreneurs to connect better with customers, leading to over 1.4 million live streams and 27 million unique comments.

Petals Malaysia, a local hair care brand, successfully expanded its reach via Shopee Live, selling over 26,000 units of its halal hair dye, demonstrating the platform's impact on business growth.

Source: The Malaysian Reserve

My Perspective: Shopee's ecosystem, including resources like Affiliate Marketing Solutions and third-party logistics, is crucial for supporting local entrepreneurs in the competitive e-commerce market. In 2024, Shopee's top 500 locally owned enterprises saw an average growth of 50% YoY, demonstrating the platform’s role in driving business expansion. If you're aiming to grow an e-commerce business, you need to be on Shopee.

5. Nubank (NU) Lending Practices - Why Wall Street Analysts are Wrong

Nubank has rapidly grown into the most valuable bank in Latin America, driven by its focus on lending to low-income families, a market that traditional banks largely ignored. Nubank's growth is extraordinary, with 60% of Brazilian adults using its app. The company’s stock has surged by 36% over the past month and 214% in two years.

However, concerns are rising among investors and analysts regarding the sustainability of its growth. Non-performing loans have hit a record 7%, above the industry average of 5.5%, and Nubank's decision to reduce provisions for bad debts, instead of increasing them as forecasted, has sparked skepticism. Some, including JPMorgan and UBS, downgraded the stock due to worries about rising late payments and asset quality. Despite this, Nubank continues to expand, with its loan portfolio growing 28% YoY, and its net income more than doubling, surpassing expectations.

While concerns about defaults loom, Nubank’s high interest rates on loans help cushion the impact of late payments. The company’s ability to adapt quickly to changing credit environments is seen as a key advantage over more rigid traditional banks.

Source: Bloomberg

My Perspective: Despite concerns over rising loan defaults, Nubank's executives, including COO Youssef Lahrech, have emphasized the bank's commitment to long-term strategies over short-term non-performing loan metrics. Concerns over the bank's credit quality are not universally shared on Wall Street, with banks like Morgan Stanley showing confidence in Nubank's strategy.

Analyst Pedro Leduc from Itau BBA notes that Nubank's funding and lower expenses help it outperform competitors in the low-income credit sector, despite market concerns about its rapid growth. Itau BBA has maintained an "outperform" rating on Nubank's stock.

Nubank boasts one of the most advanced proprietary credit underwriting models globally, known as the NuX credit engine, which utilises over 30,000 unique data points on each active customer thanks to its digital-native approach. Nubank’s “low and grow” strategy involves customers starting with credit limits as lows as $10 that gradually increase based on positive payment behaviour. Compare this to the traditional credit underwriting models of legacy banks. The video below offers valuable insights into Nubank’s credit underwriting strategy.

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6. Auto Partner (APR.WA) August Sales Update

APR reported revenue of PLN 332.9 million for August 2024, a 7% YoY increase. Year-to-date revenue through August 2024 has grown by 15%.

Source: Bankier

My Perspective: APR's monthly sales growth tends to fluctuate due to factors such as seasonality. For example, revenue grew by 20% in July but slowed to 7% in August. The company will report Q2 earnings on September 17, and I’m looking forward to joining the conference call—especially since there was no call for Q1.

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Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Adyen New Partnerships

2. Nubank Lots and Lots of News

3. Evolution U.S Market Growth

4. Sea Limited Shopee Seller Summit Singapore 2024

5. MercadoLibre Launches Dollar-Backed Stablecoin

6. Auto Partner Hints at Another Hub

1. Adyen (ADYEN) New Partnerships

Partnership with PayPal to Offer Fastlane

PayPal and Adyen have expanded their global partnership to improve guest checkout experiences for businesses. Adyen will introduce "Fastlane by PayPal," a new guest checkout feature that significantly speeds up the checkout process, in the U.S., with plans for global expansion. Fastlane helps shoppers complete purchases faster by saving and auto-filling payment and shipping details, improving conversion rates by over 80%. This partnership strengthens both companies' offerings, with PayPal enhancing its presence in global e-commerce and Adyen providing better payment solutions for its enterprise clients.

Source: Adyen IR

Expanded Partnership with BMG

The expanded partnership between Adyen and BMW Group builds on their successful global e-commerce collaboration. Adyen has provided customized payment solutions that enhance BMW's customer engagement and shopping experience. Now, Adyen's point-of-sale solutions are integrated into BMW's ecosystem, allowing seamless and premium payment experiences both online and offline, including at BMW Welt and the BMW Museum.

Source: Adyen IR

Partnership with InvoiceASAP

Adyen and InvoiceASAP have partnered to provide small businesses with instant payment capabilities. Through this collaboration, InvoiceASAP will leverage Adyen's platform to allow users to sign up, sell, and get paid instantly. This partnership is supported by Adyen's use of the FedNow Service, a new instant payment system developed by the Federal Reserve, which aims to improve the speed and efficiency of money transfers.

InvoiceASAP's CEO highlighted that their goal is to offer the fastest bank deposits for their 23,000+ merchants by combining Adyen’s advanced payment products with new cash-out functionality. Adyen, which was one of the first fintech platforms certified to use FedNow, is utilizing this certification to help companies like InvoiceASAP enhance their payment processes.

Source: Adyen IR

My Perspective: Another week, and Adyen has announced three new partnerships. As we saw in the recent H1 2024 earnings review, Adyen is on fire. There has been a lot of misinformation online regarding the PayPal Fastlane partnership, so I want to clarify what it really means.

Adyen is a payments processor that offers an omnichannel platform with over 100 payment methods for merchants. The PayPal Fastlane partnership is simply an additional payment method added to Adyen’s offering. The more payment methods Adyen can facilitate, the stronger its competitive advantage becomes. Adyen doesn't care which payment method is used, as long as it's the one processing it.

Meanwhile, a competitor realizes that to succeed, it needs to be part of the Adyen ecosystem. A payment method is only as good as its availability and acceptance—distribution is king.

2. Nubank (NU) Lots and Lots of News

Nu Asset Advances in Institutional Market

Nu Asset, Nu’s investment fund manager, is entering the institutional investor market by partnering with Itajubá Investimentos, a leader in wholesale market distribution in Brazil. This partnership will focus on offering fixed-income products to Closed Supplementary Pension Entities and Proprietary Social Security Schemes, which represent a significant portion of Brazil's pension assets, largely invested in fixed income. The agreement with Itajubá Investimentos allows Nu Asset to leverage Itajubá's distribution network, accessing a market valued at around R$ 1.2 trillion in fixed-income investments.

Source: Nubank IR

Cuenta Nu Success in Colombia

Nu Colombia's launch of Cuenta Nu has seen significant success, with over 500,000 Colombians using the product to save for their financial goals. A key feature, "Cajitas," has enabled users to set aside money, resulting in the creation of around 600,000 of these savings compartments. By August 2024, Nu had attracted over US$450 million in assets, with 35,000 accounts opened in a single day, and US$15 million in deposits.

This success is attributed to Nu's response to the financial needs of Colombians, who face barriers to saving despite having strong financial goals, such as buying homes or securing retirement. A study by Ipsos for Nu revealed that low returns and high costs are significant obstacles to saving in Colombia.

Source: Nubank IR

NuConsignado Expands Payroll Loan Service

Nu has secured seven new agreements to expand its 100% digital payroll loan service, NuConsignado, which was launched in March 2023. The new agreements include partnerships with the three branches of the Brazilian Armed Forces, and the municipalities of São Paulo, Rio de Janeiro, and Belo Horizonte, as well as the state of Paraná. With these additions, Nu will have nine agreements in total, potentially reaching over 10 million customers out of its 95.5 million customer base in Brazil.

NuConsignado offers a quick and hassle-free digital process for payroll loans, which can be completed in under three minutes through the Nu app. The service boasts some of the lowest interest rates in the market—1.41% per month for public servants and 1.56% per month for INSS beneficiaries. Additionally, customers can easily port their existing payroll loans to Nubank through the app. The entire process, including identity and data verification, is conducted digitally, ensuring security and preventing fraud. By streamlining processes and reducing costs, Nubank has positioned itself as a competitive and safe option in the payroll loan market.

Source: Nubank IR

My Perspective: If Adyen is on fire, then so is NU! Not only is NU expanding geographically, increasing its total customer base, but it is also making strides to boost average revenue per active customer by expanding its service offerings. This combination makes NU an attractive investment, as it has many levers for growth.

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3. Evolution (EVO) U.S Market Growth

Pennsylvania iGaming Revenue Update

Pennsylvania online casinos continue to generate substantial revenue, even during the summer months. In July, they earned $216.4 million in gross iGaming revenue, the third-highest amount on record. After a brief dip in June, the industry saw a strong rebound with a 10.6% increase from the previous month and a 37.7% rise compared to the same time last year. This marks the fifth time in the last six months that revenue exceeded $200 million.

Source: Play Pennsylvania

Michigan iGaming Revenue Update

Michigan's online casinos had their fourth-best revenue month ever in July, earning $191.4 million. This represents a 4.5% increase from June 2024 and a 25% increase compared to July 2023. July marked the eighth consecutive month with revenue exceeding $180 million. The highest revenue months in Michigan iGaming history were March, May, and April of 2024. So far, in 2024, online casino revenue has totaled $1.35 billion, averaging over $193 million per month. PlayMichigan projects a record-breaking year with over $2.32 billion in total revenue, surpassing the $1.92 billion earned in 2023.

Source: Play Michigan

New Jersey iGaming Revenue Update

NJ online casinos earned $195.4 million in July, marking the second-highest monthly revenue in the state's history, just shy of the March 2024 record of $197.2 million. This represents a 25.9% year-over-year increase in revenue, from $155.2 million in July 2023. July 2024 revenue was up 4% compared to June 2024, continuing a decade-long trend of July outperforming June. The five highest revenue months for NJ's iGaming have all occurred in the last five months, indicating a strong upward trend.

Source: Play NJ

My Perspective: The strong market growth in the US is a very positive sign for Evolution. It not only highlights the growth prospects in states that have already legalized iGaming, which is still in its infancy, but also shows prospective state legislators the potential tax revenue they could generate by following suit.

4. Sea Limited (SE) Shopee Seller Summit Singapore 2024

Shopee's Seller Summit Singapore 2024 highlighted key strategic initiatives aimed at empowering sellers and boosting their business growth on the platform. Key insights include:

1. Enhanced Seller Tools: Shopee introduced upgraded resources like platform vouchers, Coins Cashback Program, and daily vouchers, which have been shown to increase sales by up to 2.3 times. Sellers benefit from these tools along with preferential shipping rates, helping them attract more customers.

2. Improved Fulfillment Services: To meet the growing demand for faster delivery, Shopee has expanded its Next Day Delivery services and upgraded facilities. They now offer reduced shipping fees and have introduced a Buyer Compensation program for late deliveries, enhancing buyer satisfaction and seller competitiveness.

3. Increased Sales Opportunities: Shopee has extended key sales campaigns, such as 9.9 and 11.11, from one day to three, providing sellers with more opportunities to boost sales. Discount packages of up to 40% and an increase in discount and cashback vouchers are also being offered to attract more buyers.

4. Buyer Engagement Initiatives: Shopee's investment in livestreaming and its Affiliate Network has seen significant growth, with a 700% increase in daily livestream orders. Sellers can engage directly with buyers through Shopee Live and leverage the platform's extensive Affiliate Network to reach a broader audience.

5. Success Stories: Sellers like Genecia Alluora of Alluora skincare and Skechers have thrived on Shopee, attributing their success to the platform's user-friendly interface, marketing tools, and extensive customer base.

Source: The Sun

My Perspective: I am impressed with the moves Shopee is making to help sellers optimize sales, reduce costs, and expand their reach, ultimately supporting their growth in the competitive e-commerce market. As Shopee offers a two-sided marketplace for buyers and sellers, it is crucial to keep both sets of stakeholders satisfied.

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5. MercadoLibre (MELI) Launches Dollar-Backed Stablecoin

MercadoLibre's fintech arm, Mercado Pago, has launched a stablecoin called Meli Dolar, which is pegged to the U.S. dollar at a one-to-one value, in Brazil. This move is part of their strategy to expand their crypto offerings, as they already allow trading of cryptocurrencies like Bitcoin and Ether. The stablecoin can be traded through Mercado Pago's app, and no fees will be charged for these transactions. The stablecoin will be managed in partnership with the crypto platform Ripio, which will act as an exchange and market maker. This launch builds on MercadoLibre's earlier crypto initiatives, including the 2022 introduction of MercadoCoin in Brazil as part of a loyalty program.

Source: Reuters

My Perspective: Brazil has seen a surge in crypto trading this year, with stablecoins leading the market. The new stablecoin will provide an alternative for customers seeking to protect their purchasing power from exchange rate fluctuations.

6. Auto Partner (APR.WA) Hints at Another Hub

Auto Partner aims to maintain its current sales momentum through 2024, despite the absence of last year's inflationary boost. The company reported strong sales growth in July 2024, with a 20.15% increase, leading to cumulative revenues of PLN 2.43 billion for the first seven months of the year, a 16.53% year-over-year increase.

The company is also planning to expand its operations by opening a new warehouse in Zgorzelec by early 2026 and is considering an additional, smaller hub near Poland's western border. Despite price reductions from some suppliers, which are affecting product margins, the vice president Piotr Janta views these changes as temporary, anticipating a shift due to rising freight costs. Auto Partner continues to expand its presence, with 116 branches in Poland and plans to open more by the end of 2024.

Source: PAP Biznes

My Perspective: This is the first time a smaller hub near Poland’s western border has been disclosed. In my opinion, this is a bullish signal, as investing in additional hubs suggests that demand is not slowing.

If you'd like to support the work of an independent analyst, you can buy me a coffee. The proceeds will contribute to covering the annual running costs of the newsletter.

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Happy investing

Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Adyen Partnership with END. Clothing

2. Nubank Lots and Lots of News

3. Evolution Commences Buybacks in Earnest

4. Airbnb Short-term Rentals Surge During Paris Olympics

5. Sea Limited Shopee Experiences 66% Growth in Vietnam

1. Adyen Partnership with END. Clothing

Adyen has partnered with END. Clothing to provide a unified commerce solution integrating both online and offline payments. This partnership aims to offer a seamless and reliable payment experience, essential for END. Clothing's global expansion. The integration allows END. Clothing to gain a holistic view of their customers, enabling personalized experiences for repeat and loyal shoppers. Adyen's platform, chosen for its cost-effectiveness and operational simplicity, supports multiple local payment methods, ensuring consistent service worldwide.

Source: The Paypers

My Perspective: According to my notes, this is the 22nd partnership that Adyen has achieved in 2024 so far. It’s difficult to get a definitive number because not all partnerships are disclosed on the investor relations website, so this includes partnerships disclosed from other sources too. Still, this run rate equates to three partnerships per month. Not bad, eh?

2. Nubank (NU) Lots and Lots of News

Colombia is the Fastest-Growing Market

Nubank is rapidly expanding in Colombia, attracting 600,000 new clients with a 13% interest-rate savings account. Between April and June, this initiative brought in 900 billion pesos ($220 million) in deposits. Nu Colombia's general manager, Marcela Torres, noted that Colombia is now the company's fastest-growing market. The country's financial sector is concentrated and struggling with low credit demand and high delinquency rates.

Nu Colombia offers competitive interest rates due to its lower operational costs as an online bank, though the sustainability of these rates is uncertain. Nubank has captured a 6.4% market share for credit cards in Colombia with about 1 million clients, although growth is hindered by interest rate caps and limited credit histories among applicants.

Source: Bloomberg

My Perspective: Nubank's expansion in Colombia is already proving successful, driven by its high-yield savings account offering. This rapid growth demonstrates Nubank's ability to disrupt traditional banking in Colombia by providing attractive, digital-first products that meet consumer demands for higher yields and lower fees. We've seen the Brazil playbook indicate what the future might look like in Mexico, and it appears Colombia could be on a similar trajectory.

Cripto Platform Growth

The Nubank Cripto platform saw a 1,500% growth in transaction volume over a one-year period, from March 2023 to March 2024. During this period, there was a 56% increase in the number of customers who used the experience at least once, surpassing the 4.2 million user mark

The evolution of Nubank Cripto also includes advancements in greater operational efficiency – aimed at reducing costs for the end customer – through integration with Talos, a global leader in digital asset trading technology. Through this partnership, there is smart routing to select liquidity providers, optimising the execution of cryptocurrency buy and sell orders in Brazilian reais.

Source: Nubank IR

My Perspective: These developments position Nubank as a major player in the cryptocurrency market in Brazil given its ability to attract and retain users in this rapidly evolving sector.

Government Partnership Exceeds 3 Million Customers Within 3 Months

Nubank is transforming how Brazilians access government digital services through a partnership with gov.br. Since May, over 3.2 million Nubank customers have obtained a silver account on gov.br via the Nu app, allowing access to over 4,200 digital public services.

Currently, about 40,000 new Nubank customers connect to gov.br daily, making Nubank the leading financial institution in user connections to the silver account. The partnership ensures data privacy, with no exchange of bank or government body information between Nubank and gov.br.

Source: Nubank IR

My Perspective: Nubank's partnership with gov.br has significantly transformed how Brazilians access government digital services. This initiative underlines Nubank's role in facilitating digital transformation and improving access to essential public services for millions of Brazilians.

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3. Evolution (EVO) Commences Buybacks in Earnest

As part of its Q2 2024 earnings release last week, Evolution announced a new capital allocation framework and approved a €400 million share repurchase program. The company wasted no time, starting the buybacks the very next day.

Source: Nasdaq

My Perspective: The new capital allocation framework was the highlight of the Q2 earnings report for me. I’m pleased to see the company take advantage of its low valuation by buying back shares. So far, Evolution has been repurchasing an average of €6 million worth of shares per day. At this rate, the €400 million allocation could be exhausted within three months if the current pace continues.

4. Airbnb (ABNB) Short-term Rentals Surge During Paris Olympics

Millions of visitors are expected in Paris for the Olympic Games, leading to a surge in short-term rental listings, particularly on Airbnb. There are 44% more short-term rentals than last summer, making Paris the fastest-growing short-term rental market in the EU. Airbnb, an official Olympic sponsor, has actively promoted renting homes, resulting in a 40% increase in listings for the Games.

The average Airbnb host in Paris is projected to earn about €2,000 during the Olympics. Despite high demand, the influx of short-term rentals has led to lower occupancy rates compared to last summer. As of mid-July, occupancy was 46%, down from 59% the previous year. However, booking rates have risen, with the average rate reaching $393, a 39% increase since July 1.

The availability of short-term rentals has reduced accommodation costs, impacting hotel prices. Hotel rates have fallen by about 30% in the past three months due to increased rental supply. This situation is challenging for hoteliers, who typically expect to raise prices during such events.

Source: Business Insider

My Perspective: The surge that Airbnb is experiencing as part of the Olympic Games in Paris should come as no surprise to regular newsletter readers as this is something I have spoken about earlier this year as a potential catalyst. The other important point to emphasise is that the availability of Airbnb rentals has actually reduced hotel rates which is a net positive for the consumer. Who would have guessed that additional supply would be good for the overall market? Just a thought but perhaps the cities that have started to ban Airbnb rentals might consider their position given the data shows that limiting supply results in higher prices for the consumer.

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5. Sea Limited (SE) Shopee Experiences 66% Growth in Vietnam

In the first half of 2024, Vietnamese consumers spent VND 143.9 trillion ($5.68 billion) on 1.53 million items across five e-commerce platforms, marking a year-on-year increase of 55% in spending and 66% in items purchased, according to Metric.

TikTok Shop and Shopee experienced substantial revenue growth of 151% and 66% respectively. This contrasts with Lazada, Tiki, and Sendo, which saw declines in both revenue and sales volume.

This robust growth highlights the strong e-commerce market in Vietnam and the effectiveness of sellers leveraging online shopping trends. TikTok Shop and Shopee capitalised on livestream shopping trends and saw a 12% increase in the number of shop malls.

Source: The Investor

My Perspective: According to data from Momentum Works, Shopee held a 61% share of the $13.8 billion e-commerce market in Vietnam in 2023. This translates to $8.4 billion in GMV, with a projected growth rate of 66% in 2024. If this growth continues, Shopee's market share in Vietnam by the end of 2024 would exceed the total e-commerce market size of 2023. Wow.

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Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Sea Limited Indonesia Tariffs and New Order Cancellation Policy

2. Evolution Awards and Launches

3. NIO Record Quarterly Deliveries

4. Adyen Latest Partnerships

5. Amazon Secures $1.3 Billion Cloud Deal With Australia's Spy Agency

6. Auto Partner June Sales Update

7. Nubank The Secret Behind its Mobile Service Offering

1. Sea Limited (SE) Indonesia Tariffs and New Order Cancellation Policy

Indonesia to Impose 200% Tariffs on Chinese Imports

Indonesia plans to impose import tariffs ranging from 100-200% on Chinese goods. The tariffs aim to mitigate the effects of the US-China trade war, which has led to an oversupply of Chinese products being redirected to Indonesia. The tariffs will affect a variety of products, including footwear, clothing, textiles, cosmetics, and ceramics. The move is significant for Southeast Asia's largest economy, reflecting a balancing act between protecting local industries and ensuring the availability of imported materials for domestic production.

Source: Asia Financial

My Perspective: This is very good news for Shopee because it will reduce the threat from China-owned platforms, Temu entering Indonesia, and Lazada expanding its market share. The market share data below is from 2022 but shows the market dominance in Indonesia that Shopee already has.

Shopee Pilots New Order Cancelation Window

Shopee is testing a new policy allowing customers to cancel orders later in the shipping process to enhance user experience and compete with rivals like Lazada and TikTok Shop. This policy, currently tested on selected sellers in Ho Chi Minh City and Hanoi using Shopee’s SPX Express service, permits cancelations even when goods are en route to warehouses, unlike previous rules limiting cancelations to the pre-dispatch phase.

• Buyer Benefits

  • Buyers have more flexibility and control over their purchases.

  • It reduces the hassle of receiving and then returning unwanted goods.

• Seller Concerns

  • Increased pressure on inventory management and the risk of goods being lost or incorrectly returned.

  • Potential delays in the return of canceled goods, complicating stock management.

Source: VnExpress

My Perspective: By implementing this customer-centric approach, Shopee is following a strategy similar to Amazon's focus on customer satisfaction, even if it sometimes comes at the expense of short-term seller convenience. The goal is to create a more attractive shopping environment that will ultimately benefit both customers and sellers through increased platform usage and sales.

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2. Evolution (EVO) Awards and Launches

Best New Game Award

Evolution won Best New Game for Crazy Time at the EGR North America Awards 2024.

Source: EGR

My Perspective: Awards like this reinforces Evolution’s strength when it comes to designing and developing news games that delight players.

Live Casino Launch in Delaware

Evolution has launched its online live casino games in Delaware in partnership with Rush Street Interactive (RSI), a leading US iGaming company operating the BetRivers brand. Evolution's live games, including Roulette, Blackjack, Infinite Blackjack, Baccarat, Craps, and Poker variants, will be available through Delaware Lottery's online casino.

Source: Evolution IR

My Perspective: This launch follows the recent successful introduction of Evolution's online slots through RSI's BetRivers platform. It sounds like a land-and-expand model to me: start with the online slots, which most physical casino customers are familiar with, then introduce the live casino games. 6 U.S. states down, only another 44 to go.

3. NIO (NIO) Record Quarterly Deliveries

NIO delivered 21,209 vehicles in June 2024, a 98% increase compared to June 2023. This resulted in Q2 2024 deliveries of 57,373 vehicles, a 144% increase year-over-year and a new quarterly record. As of June 30, 2024, NIO has delivered a cumulative total of 537,020 vehicles

Source: NIO IR

My Perspective: This was a very strong performance from NIO, with deliveries topping the management guidance of between 54,000 and 56,000 units last month as part of the Q1 earnings results. However, we have seen NIO present false dawns previously, most notably in Q3 2023, before struggling to follow up. NIO needs to back this up in the quarters and years ahead. I’ll be most interested in learning the average selling price achieved in Q2 because this has been continually downward since 2021.

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4. Adyen (Ticker: ADYEN) Latest Partnerships

Partnership With noon

Adyen is partnering with noon, a leading e-commerce platform in the Middle East. noon, which began in 2017, has developed a digital ecosystem serving the UAE, Saudi Arabia, and Egypt, and created its own payment infrastructure, noon payments, to support its growth.

This partnership aims to enhance noon’s payment solutions for merchants and customers by integrating Adyen’s comprehensive suite of services, which includes point-of-sale, advanced 3D secure and risk configurations, and shopper insights. The collaboration will help noon accelerate e-commerce innovations and improve the customer experience by streamlining payment processes, reducing fraud, and providing valuable consumer insights.

Source: Adyen IR

My Perspective: By partnering with noon, Adyen gains a strong foothold in the rapidly growing UAE, Saudi Arabia, and Egyptian markets. By partnering with an e-commerce platform, Adyen will handle a significant volume of transactions across noon's digital ecosystem.

Decathlon Hong Kong Partnership Update

Back in April, Decathlon Hong Kong and Adyen announced a new partnership and this week Kent Lam, Head of Technology at Decathlon Hong Kong, sat down with Frontier Enterprise, to discuss their payments transformation and how its partnership with Dutch payment company Adyen eliminated many business hurdles.

Decathlon Hong Kong faced significant challenges with its previous payment system, which involved two separate vendors for point-of-sale (POS) terminals and a payment service provider (PSP). This complicated setup led to issues like duplicated charges and overwhelmed customer service due to refund claims. Additionally, the POS systems were becoming outdated, and upgrading them was both costly and uncertain.

To resolve these issues, Decathlon Hong Kong switched to Adyen, primarily because of Adyen's experience integrating with Decathlon's web POS system, Openbravo, and their global contract, which simplified operations. This change eliminated duplicate charges, reduced fraud through better risk management, and lowered transaction fees. Adyen's comprehensive payment solutions covered all of Decathlon Hong Kong’s payment channels, including online, in-app, and physical stores, and supported Apple Pay and upcoming Google Pay.

Source: Frontier Enterprise

My Perspective: By addressing various aspects of payment processing and management, Adyen's solution helped Decathlon Hong Kong save money through increased efficiency, reduced errors, lower fees, and improved customer satisfaction. This comprehensive approach to payment management demonstrates why partnering with a unified commerce solution like Adyen can be financially beneficial for merchants.

5. Amazon (Ticker: AMZN) Secures $1.3 Billion Cloud Deal With Australia's Spy Agency

Amazon Web Services (AWS) is developing a top-secret cloud for the Australian government, aimed at enhancing information sharing, analysis, and defense communications. Australia will invest at least AUD$2 billion (US$1.3 billion) over the next decade for the establishment and operation of this cloud. The initiative involves a strategic collaboration between the Australian Signals Directorate (ASD) and AWS, with a focus on cybersecurity.

The cloud will facilitate improved collaboration within Australia’s intelligence and defense sectors and with U.S. partners, supporting military operations and integrating advanced technologies like AI and machine learning. The move comes in response to increasing cyberattacks on Australian government entities and companies, highlighting the need for robust cybersecurity measures.

Source: Benzinga

My Perspective: This is a significant win for Amazon as this deal establishes AWS as a trusted partner for Australia's top-secret intelligence data, positioning the company as a key player in national security infrastructure. Winning a contract to handle top-secret intelligence data demonstrates AWS's ability to meet the highest security and compliance standards, potentially opening doors to similar contracts globally.

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6. Auto Partner (Ticker: APR.WA) June Sales Update

APR reported June 2024 revenue of PLN 351.6 million, representing an increase of 11% YoY. APR’s Q2 2024 revenue is PLN 1.063 billion representing an increase of 13% YoY.

Source: Auto Partner IR

My Perspective: The June sales update has culminated in a disappointing quarter of revenue growth, falling well below the 20% management target. Furthermore, margins are expected to be compressed for the remainder of 2024 due to minimum wage increases and FX headwinds that I have discussed previously. I am expecting Q2 earnings to be quite poor. Management’s explanation for the growth slowdown will be interesting.

7. Nubank (Ticker: NU) The Secret Behind its Mobile Service Offering

Earlier this year, Nubank launched mobile services, initially perceived as a cross-marketing strategy to generate additional revenue. Nubank has a large customer base, making the integration of mobile plans a potentially lucrative addition.

Nubank partnered with Gigs, likened to the "Stripe of mobile," to create an ecosystem where banking acts as a central hub for various value-added services. Hermann Frank, CEO of Gigs, emphasizes the strategic advantage of bundling mobile plans to convert users into regular subscribers, promote premium features, and offer a comprehensive service ecosystem.

Gigs enables businesses to quickly launch their own mobile services by providing embeddable and programmable phone plans, significantly reducing development time from 18 months to just days. For example, Nubank offers travel SIMs through its app with a simple, streamlined process.

Source: Tearsheet

My Perspective: This strategic move positions Nubank as more than just a bank, transforming it into a comprehensive digital ecosystem that caters to various aspects of its customers' lives. By bundling financial services with mobile connectivity, Nubank is creating a more integrated and valuable offering for its users, potentially leading to increased customer acquisition, retention, and long-term growth.

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Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

The Nubank investment thesis will be released this Thursday 27 June. Make sure you’re subscribed so you receive it straight to your inbox.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. MercadoLibre Experiences Credit Card Reader Boom in Mexico

2. Evolution Latest Launches

3. Adyen Market Leadership and Latest Partnerships

4. Meta Reality Labs Update

5. Airbnb French Hotels Launch $10 Million Lawsuit

1. MercadoLibre (Ticker: MELI) Experiences Credit Card Reader Boom in Mexico

Mercado Pago's mobile credit card readers in Mexico have more than doubled in adoption over the past year. This surge is indicative of a growing shift towards digital payments in a market traditionally dominated by cash.

Mexico, despite being the second-largest economy in Latin America, lags behind Brazil in digitalization. Traditional banks and local competitors like Clip are being outpaced by Mercado Pago’s affordable and accessible card readers. The number of credit card readers in Mexico has increased from 2 million five years ago to over 4 million, largely driven by third-party providers like Mercado Pago.

At a price of 149 pesos ($8.07), Mercado Pago’s readers are easy for small businesses to acquire online, enhancing their payment capabilities. The success of Mercado Pago's card readers suggests a significant shift in Mexico’s payment landscape, with fintech solutions outperforming traditional banking devices.

Beyond card readers, Mercado Pago is broadening its services to include loans, credit and debit cards, and international transfers. They approved over 1 million small-business loans last year and aim to surpass 2 million in 2024. Mercado Pago is planning to apply for a banking license to offer additional services like savings accounts, CDs, commercial loans, and mortgages.

Source: Reuters

My Perspective: Mercado Pago is positioned to play a pivotal role in advancing Mexico’s financial digitalization. The opportunity for MELI and NU in Mexico is enormous. 51% of Mexico's population remains unbanked.

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2. Evolution (Ticker: EVO) Latest Launches

Spanish Language Blackjack Live in New Jersey

Evolution has launched VIP Blackjack en Español is now live in New Jersey. This development allows the world-class VIP Blackjack to be available in Spanish in North America

Source: Evolution Social Media

My Perspective: Last year, I suspected that the undersupply, particularly in Europe, was due to the multiple language offerings. It is very positive to see Evolution already launching in Spanish in U.S. states where there is a large Hispanic population. By offering games in multiple languages, it makes it harder for sub-scale competitors.

New live slot Balloon Race Released

Evolution launched a new live slot, Balloon Race which offers a captivating blend of unique slots and an exciting live Bonus game.

Source: Evolution Social Media

My Perspective: Live casino is Evolution's core competence. It is fascinating to see Evolution bridging the gap between RNG slots and live casino by introducing games that are a hybrid of both. Evolution’s pace of innovation continues to be a real strength.

3. Adyen (Ticker: ADYEN) Market Leadership and Latest Partnerships

Recognized as a Leader by IDC MarketScapes

Adyen has been recognized as a Leader in the 2024 IDC MarketScape assessments for both Retail Online Payment Platform Software Providers and Retail Omnichannel Payment Platform Software Providers. This recognition highlights Adyen's comprehensive solution, innovation, and merchant focus.

Key insights include:

1. Comprehensive Solution: Adyen offers a single integrated platform that manages all payment processes (accepting, processing, settling) across various channels (online, mobile, in-person).

2. Innovation: Adyen focuses on innovation to enhance merchant outcomes, including faster, more accurate fraud detection and authentication using advanced AI/ML and biometrics.

3. Focus on Merchants: Adyen prioritizes customer feedback and evolving needs in developing new features and enhancements.

Source: Adyen IR

My Perspective: Adyen is the best in the business at what it does. You don’t just have to take my word for it; we can see how industry experts rank it compared to the competition.

The merchant processing landscape is more competitive than ever, and service providers today have to do so much more than was true just a few years ago. Adyen’s position as a Leader reflects their recognition of the challenges in the market and the work they have done to meet merchant needs.

- Aaron Press, Research Director, Worldwide Payment Strategies at IDC

Partnership with SumUp

Adyen and SumUp have entered into a strategic partnership to enhance the payment experience and accelerate settlements for small businesses globally. This collaboration aims to provide SumUp's merchants, particularly small and micro merchants in Europe and the UK, with faster access to their funds, enabling same-day settlements every day of the year.

The partnership addresses critical cash flow needs by allowing merchants to receive their payments within minutes rather than days, reducing the need for large working capital reserves. SumUp serves over 4 million merchants across 36 markets.

Source: Adyen IR

Partners with MECCA

Adyen has partnered with MECCA, Australia’s largest prestige beauty retailer, to enhance its payment systems both in-store and online. MECCA, which has been a leading beauty retailer for 27 years with over 110 stores and a strong e-commerce platform, aims to improve its customer experience and fraud protection through this partnership.

MECCA selected Adyen to streamline the payment process, ensuring reliability and simplicity for customers, whether they shop online or in-store. This includes the adoption of Adyen's Unified Commerce and Pay-by-Link technologies.

Source: Adyen IR

My Perspective: By partnering with companies in different industries, Adyen is diversifying its client base and expanding its reach across various sectors. Both partnerships showcase Adyen's ability to integrate its advanced payment technologies with different business models and needs.

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4. Meta (Ticker: META) Reality Labs Update

Meta has announced a major restructuring of its hardware division, Reality Labs, aiming to sharpen its focus on augmented reality (AR) and the Metaverse. The restructuring consolidates Reality Labs into two main groups:

1. Metaverse: This group includes the Quest headset line, Horizon (Meta's social network), and related technologies.

2. Wearables: This new group covers the rest of Meta's hardware efforts, such as the smart glasses collaboration with Ray-Ban.

Source: Supreme Bagholder Social Media

My Perspective: The restructuring of Meta's Reality Labs division into Metaverse and Wearables groups signals that Meta is doubling down on its smart glasses technology, particularly after the unexpected success of its Ray-Ban Meta smart glasses. While the organisational structure is important and I think this move is a smart one, the success of Meta's initiatives will ultimately depend on execution.

5. Airbnb (Ticker: ABNB) French Hotels Launch $10 Million Lawsuit

A group of 26 hotels in France has initiated a lawsuit against Airbnb, alleging unfair trade practices and seeking €9.2 million ($9.9 million) in damages. Each hotel is claiming an average of €355,019. The hotels accuse Airbnb of allowing illegal ads on its platform and failing to pay tourist taxes for 2021 and 2022. They claim this has resulted in a loss of clientele and commercial disruption, as illegal ads avoid the costs associated with legal commercial activities.

Airbnb counters these claims by stating that the lawsuit is part of ongoing efforts by hotel lobbies to restrict its operations. The company asserts that it has paid over €187 million in tourist taxes to French communes and that it complies with French laws, which allow families to share their homes. The hearing is expected within a year. Airbnb indicates it will consider all legal avenues to protect its rights and the rights of its hosts if the lawsuit negatively impacts its business or host families.

Source: Morningstar

My Perspective: Regulation has always been the biggest risk facing Airbnb, and this is an extension of that risk. I don’t see Airbnb losing this, but the lawsuit highlights the growing tension between traditional hotels and short-term rental platforms like Airbnb. The lawsuit also signals a shift in the hospitality industry's approach to dealing with disruptive platforms, moving from competition to legal confrontation.

If you'd like to support the work of an independent analyst, you can buy me a coffee. The proceeds will contribute to covering the annual running costs of the newsletter.

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Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

A very quick announcement today. I am excited to reveal that the next investment thesis on Nubank will be released later this month. I’ve been working on this piece of research for almost six months now (on and off) and I’m excited to share it. Subscribers can expect a similar level of depth and detail as in previous deep dives, such as Adyen and Evolution last year. Make sure you’re subscribed so you receive it straight to your inbox.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Evolution Lots and Lots of News

2. Nubank Reaches 2 Million Active Insurance Policies in Brazil

3. Sea Meta and Shopee Roll out New Feature in Thailand

4. Adyen and Stripe partner with Capital One to Combat Fraud

5. MercadoLibre Large Language Model Use Cases

1. Evolution (Ticker:EVO) Lots and Lots of News

Illinois Eyes iGaming to Boost State Revenue

The state of llinois has increased the sports betting tax rate to a graduated structure with the new tax rates expected to generate an additional $170 million to $200 million annually for the state. This increase primarily impacts FanDuel and DraftKings, the largest operators in Illinois.

The tax hike was driven by the need to balance the state budget. House Gaming Committee Chairman Dan Didech mentioned that while operators may not be as profitable as before, they are expected to remain profitable.

Source: PlayUSA

My Perspective: While Illinois has increased the sports betting tax to address immediate budgetary needs, this move may pave the way for future iGaming expansions, particularly online casinos, as a means to generate additional revenue. Evolution is waiting patiently in the wings.

NolimitCity Launches in the US

Evolution has announced its entry into the US online gaming market by launching Nolimit City's slot games in six states: Connecticut, Delaware, Michigan, New Jersey, Pennsylvania, and West Virginia. This launch is significant as it is the first simultaneous rollout across all these states. Nolimit City became part of the Evolution Group in 2022 as part of a €340 million acquisition.

Source: Evolution IR

My Perspective: While slots are not Evolution's core competency, these games are what most land-based casino customers are familiar with, making them a good way for Evolution to attract players to its One Stop Shop platform.

New Jersey Online Casino Revenue Grows 21% in 2024

In May, New Jersey's online casinos experienced their second-highest revenue month ever, generating over $192 million, a 19% increase from the previous year. This follows March's record-setting $197.2 million. The cumulative revenue for the first five months of 2024 stands at nearly $942.8 million, up 21% from the same period in 2023.

In 2023, NJ online casinos set a new state record with over $1.9 billion in revenue, surpassing the previous year's $1.66 billion. The current trends suggest that 2024 may surpass these figures, potentially reaching or exceeding $2 billion in annual revenue.

Source: Play NJ

My Perspective: It is extremely positive to see such strong growth in the state of New Jersey. Not only is this a direct benefit to Evolution’s revenues at the moment but it will be an example for other US states. Look at all of the additional tax revenue you could raise overnight if you legalised iGaming in your state.

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2. Nubank (Ticker: NU) Reaches 2 Million Active Insurance Policies in Brazil

Nubank and Chubb, a global insurance leader, have achieved a major milestone of 2 million active insurance policies in Brazil. This success is largely driven by Nubank Vida, a digital insurance product launched in 2020, which alone has over 1 million active policies.

The collaboration between Nubank and Chubb has been pivotal, leveraging Chubb's digital distribution platform, Chubb Studio, to efficiently create and offer insurance products through Nubank's app. As a fully digital insurance product, Nubank Vida allows users to manage their insurance needs entirely online. It addresses the high costs and lack of awareness that previously hindered access to life insurance.

Nubank’s insurance portfolio, developed with Chubb, includes various products like home, cell phone, loan protection insurance, and a unique life insurance product, Nu Vidas Juntas, which allows policyholders to gift an individual policy to another Nubank client.

Source: Nubank IR

My Perspective: Another nice milestone for Nubank. The important takeaway is that Nubank is bridging the insurance gap in Brazil by democratising access to insurance products. Nubank is quite literally expanding the insurance market in Brazil by bringing customers onboard that otherwise would not have insurance.

3. Sea (Ticker: SE) Meta and Shopee Roll out New Feature in Thailand

Meta has introduced shopping features within its Messenger service, in collaboration with Shopee, to facilitate seamless shopping experiences by integrating Shopee's merchant product catalogues. This feature, launched in Thailand, is intended to compete with TikTok and enhance both Meta's advertising revenue and Shopee's user traffic.

Thailand was chosen due to its high number of Facebook and Messenger users, with over 60 million Facebook users. The integration allows businesses to sync their Shopee catalogues with Messenger, providing a smooth shopping experience for Thai consumers.

Additionally, Meta has partnered with V Rich App to test Live Shopping tools, making it easier for businesses to showcase and sell products through livestreams. These tools will be available from mid-June in collaboration with V Rich App, ZWIZ.AI, Kaojao, and others.

Source: Bangkok Post

My Perspective: This is a very significant partnership for Sea Limited. Up until now, it could be argued that it was taking on TikTok on its own. Now, it has the support of a $1.3 trillion giant in Meta.

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4. Adyen (Ticker: ADYEN) and Stripe partner with Capital One to Combat Fraud

Capital One is collaborating with payment giants Stripe and Adyen to develop a free product aimed at reducing fraud, demonstrating a shift from competition to cooperation within the financial sector.

Capital One has created an open source project called Direct Data Share, which is an API designed to allow merchants and payment processors to share real-time transaction data. By sharing transaction data through Direct Data Share, the partners can detect and prevent fraud more effectively. For example, if a fraudulent IP address is detected via Stripe, it can also be flagged for transactions processed by Adyen.

Source: Tech Crunch

My Perspective: This is a great example of mission-driven companies like Adyen putting aside commercial interests and focusing on protecting customers for the common good. Positive customer goodwill compounds over time.

MercadoLibre (Ticker: MELI) Large Language Model Use Cases

Large Language Models (LLMs) have made rapid advancements over the past year, highlighting the transformative impact of OpenAI's GPT API on natural language processing (NLP) tasks. MELI has been exploring various innovative applications of LLMs, focusing on the practical aspects and lessons learned from their experiences.

Retrieval Augmented Generation (RAG)

RAG involves using LLMs to generate personalized answers by retrieving information from relevant documents.

Initial attempts with Llama Index showed success but revealed that LLMs struggled with questions outside their contextual knowledge base, often leading to inaccurate or hallucinated responses.

Enhancing documentation was crucial to ensure the model could provide accurate answers.

Documentation Generation Use

Integrating LLMs to generate comprehensive documentation for data tables was a significant challenge due to the vast number of tables and the incomplete existing documentation.

Using a generic prompt, the team generated documentation that was well-received by most stakeholders.

Lessons learned included the need for iterative prompt refinement, quality assurance, and creating a clear structure for outputs.

Natural Language Inputs

LLMs were used to extract specific information from raw text, going beyond basic named entity recognition to interpret contextual meanings (e.g., identifying "next week" as a specific date).

In use cases like booking services, LLMs helped translate natural language queries into actionable data, improving user experience and efficiency.

Source: MercadoLibre Tech

My Perspective: AI and LLMs have been the flavor of the month for the past year or two. While we can see the demand for Nvidia chips, I’m more interested in how the companies consuming all of these resources can truly benefit from AI.

The insights provided by MELI shed light on this. There is still a long way to go. While LLMs can effectively interpret and process complex natural language inputs, they require comprehensive and relevant documentation to provide accurate responses. Any gaps in documentation can lead to inaccuracies.

If you'd like to support the work of an independent analyst, you can buy me a coffee. The proceeds will contribute to covering the annual running costs of the newsletter.

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Happy investing

Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com

Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

There is a lot do discuss this week, let’s dive into today’s edition!

Todays Agenda

1. Airbnb at Bernstein Strategic Decisions Conference

2. Adyen Partnerships

3. Crowdstrike Q1 2025 Earnings

4. Lululemon Q1 2024 Earnings

5. NIO Q1 2024 Earnings

6. MercadoLibre Investments in Brazil to Exceed $4.35 Billion

7. Auto Partner May Sales Update

1. Airbnb (Ticker: ABNB) at Bernstein Strategic Decisions Conference

ABNB Chief Financial Officer, Ellie Mertz, was a guest speaker at the Bernstein 40th Annual Strategic Decisions Conference 2024. The following were my key highlights from the session:

1. Dynamic Pricing Implementation: Many properties maintain a static pricing model, not adjusting prices dynamically based on demand or market conditions. There's a roadmap for enhancing pricing strategies, aiming to eventually offer more dynamic pricing tools. The focus is on providing tools and suggestions rather than imposing dynamic pricing, allowing hosts to maintain control over their pricing.

2. Unique Inventory: ABNB's inventory includes many individual hosts with unique listings, which are often exclusive to the platform. The platform is designed to support individual hosts, which differentiates Airbnb from competitors that focus more on professionally managed properties. This is supported by data from analytics firm AirDNA which found that at the end of 2023, 70% of Airbnb’s hosts or 3.5 million, had only one listing on the platform.

   

   There's a common belief that professional hosts provide higher quality than individual hosts, but data suggests individual hosts often have higher ratings. Professional hosts are important, filling supply gaps in specific markets, but they are a minority of the business.

3. Take Rates: Historically, ABNB's take rates have been simple and not dynamic. Recent adjustments include lowering take rates for long-term stays (over 3 months) to increase volume. Testing small FX fees for cross-currency transactions is ongoing to see if it can drive incremental volume or monetization.

4. Potential Loyalty Program: ABNB is considering a differentiated loyalty program that might look different from traditional transactional models, possibly a subscription model offering incremental services.

Source: Koyfin

Koyfin is the financial tool I use to conduct research and screen for new ideas. The Pro version also includes transcripts from earnings calls and conferences, such as the Bernstein conference mentioned above, which are not often recorded. I have partnered with Koyfin to offer readers a 20% discount by clicking the button below.

20% Koyfin Discount

2. Adyen (Ticker: ADYEN) Partnerships

Prada

Adyen announced a partnership with Prada Group to enhance in-store payment experiences and support the company's omnichannel commerce strategy. This collaboration will enable Prada Group to use Adyen's unified financial technology platform across all retail channels, providing a seamless and unique luxury customer experience.

Prada Group aims to integrate its sales channels to provide a consistent and seamless shopping experience. Adyen’s platform will help manage payments across all channels, giving Prada a single view of each customer. According to Adyen’s 2024 Retail Report, 55% of shoppers abandon their purchase if they can't pay as they prefer, and 27% no longer carry physical wallets. This underscores the need for flexible payment options.

Prada is leveraging Adyen’s Tap to Pay on iPhone technology in the U.S. and Milan stores, with plans to expand. This technology supports all forms of contactless payments without additional hardware, enabling sales associates to process payments anywhere in the store. By migrating to Adyen’s single platform, Prada Group can efficiently collect and manage payment data, enhancing customer interactions and personalizing experiences across all touchpoints.

Adyen has a longstanding relationship with Prada Group, initially supporting e-commerce and now expanding to omnichannel solutions globally. The Devil wears Prada, but he prefers to pay seamlessly!

Source: Adyen Press and Media

Nelly Solutions

Adyen has partnered with Nelly (no, not the rapper), a health and fintech company, to streamline payment management for medical practices. The partnership enables integration into practice software, allowing medical practices to handle all payment processes through a single, unified system.

Medical practices can use Nelly for digital payment processing and maintain a bank account with a local IBAN through Adyen's banking license. Issuance of both virtual and physical corporate credit cards is included.

Integration with Adyen simplifies financial administration, from patient admission to payment processing, and supports various payment methods, including digital payment links, POS terminals, and installment payments. The digital process simplifies payment acceptance and reduces administrative time for both patients and practices.

Source: Adyen Press and Media

My Perspective: Another week and more customer wins from Adyen. At this rate, this is going to be a recurring weekly section!

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3. Crowdstrike (Ticker: CRWD) Q1 2025 Earnings

CRWD delivered exceptional Q1 results, setting records across multiple metrics. Key highlights include:

• Financial Performance

  Total revenue grew 33% year-over-year (YoY) to $921 million. Net new Annual Recurring Revenue (ARR) reached $212 million, a 22% increase YoY. Ending ARR hit $3.65 billion, growing 33% YoY. Reported Free Cash Flow (FCF) of $322 million, equating to a 35% FCF margin. CRWD achieved significant YoY operating leverage and GAAP profitability for the fifth consecutive quarter.

  

• Customer Adoption and Module Growth

  Customers are increasingly embracing CRWD's platform strategy, as indicated by a significant increase in deals with eight or more modules, growing by 95% over the previous year's Q1. Subscription customers with five, six, and seven or more modules have increased, with 65%, 44%, and 28% respectively, of subscription customers falling into these categories.

  The number of deals involving cloud, identity, or Falcon Next-Gen SIEM modules more than doubled YoY.

  

• Customer Success Stories

  Management shared a notable case involving a breach at a leading healthcare company using Microsoft products. CRWD's Incident Response team swiftly intervened with 46,000 sensors, halting the breach and restoring operations. The healthcare company embraced various CRWD solutions, leading to the replacement of Microsoft security products, a legacy SIEM, and a vulnerability management vendor. Consolidating to CRWD's single agent reduced the agent footprint by 75%. Detection and response time improved by 700%, with average alert triage dropping from over four hours to minutes. This consolidation resulted in a lower Total Cost of Ownership and enhanced cybersecurity outcomes.

Source: Crowdstrike IR

My Perspective: Expectations were high going into this quarter, but CRWD delivered. Few services are becoming as mission-critical as cybersecurity, given the strong financial impact of breaches on companies and the loss of customer trust. The failings apparent in Microsoft’s security solutions should also be noted, with CRWD being recognized as a leader in this area by Gartner.

CRWD is a stock that is high on my watchlist, and I would like to own it. Unfortunately, the stock remains richly valued, trading at a forward EV/Sales of 19 and 81 times forward earnings, so I remain on the sidelines for now. This is a company to keep on the radar. On Friday, it was announced that CRWD would be joining the S&P 500 index on 24 June as part of a rebalancing.

4. Lululemon (Ticker: LULU) Q1 2024 Earnings

LULU stock was down 40% YTD, so its Q1 2024 earnings were eagerly anticipated by investors. Key highlights include:

• Revenue

  Revenue rose by 10% overall to $2.2 billion, or 11% in constant currency, with significant growth in international markets. Mainland China saw a 52% increase, and the rest of the world grew by 30%. In the Americas, revenue increased by 4% in constant currency, with Canada up 12% and the U.S. up 2%. By category, women's merchandise grew by 10%, men's by 15%, and accessories by 2%. Store sales rose by 12%, and digital revenue increased by 8%.

• Profitability

  Gross profit reached $1.28 billion, with a slight gross margin increase to 57.7% due to lower costs and higher product margins. Earnings per share were $2.54, up from $2.28 the previous year.

• Capital Allocation

  The company also repurchased nearly $300 million of stock in Q1 and $230 million in Q2 so far, with an additional $1 billion authorized for future repurchases.

• Guidance

  Revenue guidance remains at 10% to 11% growth for the year. Management expects to open 35-40 new stores and maintain a steady gross margin. Full-year EPS guidance was raised to between $14.27 and $14.47.

Source: Lululemon IR

My Perspective: Despite a weak consumer market, LULU's business remains robust, supported by effective brand engagement and significant international growth potential. LULU has maintained its high margins, which means that it is not discounting its products, thereby maintaining a premium brand. The international segment, currently 21% of the business, is expected to grow to 50% over time. In the U.S., the slower start to the year was attributed to missed opportunities in women's apparel and bags, but strong performance in men's products. LULU trades at just 22 times forward earnings, which is very reasonable for a company growing its top line by over 10% with very healthy margins. This is another name high on the watchlist but already at an attractive valuation.

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5. NIO (Ticker: NU) Q1 2024 Earnings

NIO reported another disappointing quarter, which was well signposted given the company reports monthly delivery figures. Key highlights include:

• Deliveries

  NIO delivered 30,053 vehicles in Q1, down 3% YoY. In the second quarter, the company's deliveries began to increase month by month due to the launch of new model year products and a more flexible sales policy. In April, NIO delivered 15,620 vehicles, and in May, this number rose to 20,544 vehicles. Consequently, NIO's market share in the premium battery electric vehicle segment grew significantly, with YoY growth surpassing the segment average.

  

• Revenue

  Total revenues were $1.37 billion, marking a decline of 7% YoY and 42% quarter-over-quarter (QoQ). Vehicle sales, comprising 85% of total revenue, amounted to $1.16 billion, reflecting a decrease of 9.1% YoY and 45.7% QoQ. The YoY revenue drop was primarily due to lower average selling prices following user rights adjustments in June 2023 and reduced delivery volumes.

• Profitability

  The overall gross margin improved to 4.9% from 1.5% the previous year but dropped from 7.5% in the prior quarter, influenced by vehicle margins. Vehicle margins were 9.2% this quarter, up from 5.1% a year ago but down from 11.9% last quarter due to lower average selling prices and increased promotions. The loss from operations increased by 6% YoY to $747 million.

• Guidance

  For Q2 2024, NIO anticipates vehicle deliveries between 54,000 and 56,000 units and total revenues between $2.3 billion and $2.4 billion, marking an increase of approximately 89% to 95% from Q2 2023.

Source: NIO IR

My Perspective: Q1 was really poor, but Q2 already looks far more promising. NIO has delivered over 36,000 vehicles, which is already more than Q1 with one month to go. The continual downward trend in average selling prices is the real concern. Based on the Q2 guidance, it appears that this could drop even lower.

The slowdown in China resulted in deliveries of pure electric and plug-in hybrid cars falling by 31% quarter-on-quarter to 1.76 million units in Q1, according to CPCA data. Competitor BYD slashed prices of nearly all of its cars by 5%-20% since mid-February. Since then, the prices of 50 models across a range of brands have dropped by 10% on average, according to Goldman Sachs. Price wars are never a good thing.

6. MercadoLibre (Ticker: MELI) Investments in Brazil to Exceed $4.35 Billion

MELI will exceed its initial investment of 23 billion reais ($4.35 billion) in Brazil due to higher-than-expected sales. The revised capital expenditure plan is not yet fully disclosed but the company plans to hire 11,000 people in Brazil this year, up from the previously estimated 6,500.

MELI also plans to open two new distribution centers in Porto Alegre and Brasilia, in addition to the previously announced center in Recife. The company currently has over 20 distribution centers in Latin America, with about half located in Brazil, its main market.

MELI is implementing a new strategy to enhance efficiency in its distribution centers using robots from Quicktron. This automation aims to reduce the time for picking and packaging products, potentially speeding up same-day delivery times by 30 minutes to one hour.

Source: Reuters

My Perspective: A company investing more money due to higher-than-expected sales is music to a growth investor's ears. MELI’s implementation of robotics and automation reinforces my belief that it is a technology-first company. It always has been and it always will be.

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7. Auto Partner (Ticker: APR.WA) May Sales Update

APR reported May 2024 revenue of PLN 357.7 million, representing an increase of 7% YoY. On a cumulative basis, APR’s 2024 revenue is PLN 1.706 billion representing an increase of 17% YoY.

Source: Auto Partner IR

My Perspective: While the May number appears low, it should be noted that there was one fewer working day in Poland in May 2024 compared to May 2023. APR’s monthly revenue can be quite lumpy for a variety of reasons. For reference, March growth was 5%, while April was 23%. While I don’t believe a single month or quarter of data in isolation provides much value, APR will need to have a strong second half of the year to achieve management's target of +20% annual growth.

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Wolf of Harcourt Street

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Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Evolution at NEXT Summit: Valletta

2. Shopee Probed for Alleged Competition Rule Breaches

3. More Good News for Nubank

4. Amazon to Invest Billions in European Data Centre Expansion

5. The Technological Evolution at MercadoLibre

6. Wedbush Research on Airbnb

1. Evolution (Ticker: EVO) at NEXT Summit: Valletta

This event is viewed by many as the pinnacle of the iGaming industry, offering insights from 300 industry-leading voices. For those of us who could not make the event, it was live-streamed on YouTube.

The following were my key highlights from the event:

1. Rapid Industry Growth: The global iGaming market, valued at around $73 billion in 2023, is projected to exceed $127 billion by 2027, driven by technological advancements and increased mobile and internet accessibility.

2. AI Integration: Artificial Intelligence is gradually being incorporated into iGaming, with the potential to enhance game personalisation, customer service, and operational efficiency. The importance of proactively testing and integrating AI tools was emphasised.

3. Emerging Markets Focus: There is a notable shift towards emerging markets, especially in Latin America and Asia, due to their growing internet access and untapped potential. Latin American countries are becoming focal points for iGaming expansion. Industry leaders are increasingly focusing on these regions, adapting strategies to align with local cultural and regulatory contexts. This was further reinforced earlier this week when Evolution announced the launch of its portfolio of live casino games with Jugamax in Paraguay.

Friend of the newsletter, , attended the event. He spent two hours chatting with Evolution’s Chief Product Office, Todd Haushalter. I recommend reading his notes from the event, which are linked below.

Do Not Distribute

Conversation with Evolution's Todd Haushalter

I was in Malta last week for the NEXT Summit Valletta 2024 and had the chance to get valuable insights from industry insiders. Todd Haushalter Evolution’s Chief Product Officer was very generous with his time and I got to spend close to two hours with him…

Read more

2 years ago · 14 likes · 6 comments · Ali Gündüz

2. Shopee (Ticker: SE) Probed for Alleged Competition Rule Breaches

Indonesia’s anti-trust agency is investigating local branches of e-commerce platforms Shopee and Lazada for potential anti-competition rule violations. Shopee and Lazada are accused of favoring their own affiliated logistics services over other providers, potentially restricting consumer choice and impacting other logistics partners.

Shopee is suspected of directing users to its affiliated logistics provider, Shopee Xpress, which could unfairly boost Shopee Xpress’s shipping volumes. Indonesia’s anti-trust agency has emphasised the importance of consumer freedom to choose their preferred delivery providers and the need for marketplace platforms to avoid using algorithms to favour their affiliated companies.

Shopee’s legal team will respond to the hearing on 11 June. While no details were given about the possible penalties for Shopee, Lazada is facing fines of up to 50% of its net profit or 10% of its total sales, earned within the market during the period of infringement.

Source: Reuters

My Perspective: Shopee Xpress is integral to Shopee’s operations. In Q1, 70% of Shopee Xpress orders were delivered within three days in Asia, and the cost per order decreased by 15% in Asia and 23% in Brazil. Management has spent considerable resources building out the logistics network, so it will be very interesting to see how this case plays out given the knock-on implications for the e-commerce supply chain.

What I find most interesting about this case is that, for the past few years, the general consensus appeared to be that Shopee did not have any moat and that the e-commerce market in Southeast Asia was fiercely competitive. Now, Shopee is being investigated for anti-competitive practices. So, which is it? Without hearing Shopee's defense, I feel like this is a nothing burger and actually reinforces the competitive position of Shopee.

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3. More Good News for Nubank (Ticker: NU)

Nubank Reaches 3 Million Under-18 Accounts

NU has achieved a significant milestone with 3 million users of its under-18 accounts, solidifying its market leadership among 10 to 17-year-olds. The account for young people saw a sixfold increase in customers in 2023, reflecting NU's commitment to early financial education and secure, practical solutions for parents. The account requires a legal guardian, who is also a NU customer, to initiate the account setup.

NU has integrated several parental control features, including real-time transaction notifications, allowing parents to monitor their children’s financial activities while maintaining the child's financial autonomy. The platform offers Gift Cards with exclusive discounts for young users, usable on various popular platforms. These additions enhance the financial tools available to young users and provide further value.

Source: Nubank IR

My Perspective: This cohort increased sixfold in 2023 meaning that it had only half a million under-18 accounts at the end of 2022. This is a staggering growth rate considering NU only began to offer under-18 accounts in July 2022.

Nubank launches NuViagens

NU announced the launch of NuViagens, a travel planning platform for its high-income customers, integrating the convenience of booking air tickets and hotels through the NU app. Key features of NuViagens include:

• Best Price Guarantee: If a customer finds a lower price for a flight or hotel within 24 hours of purchase, NU will refund the difference.

• Price Monitoring and Alerts: The platform monitors flight prices and recommends the best time to buy. Customers who purchase at the recommended time get automatic reimbursement of up to BRL 500 if the price drops within 30 days.

• Flexible Payment Options: Purchases can be made in up to 8 interest-free installments via NuPay, and customers earn 1% cashback that grows at 200% of the CDI.

• 24/7 Travel Support: Dedicated travel-related support is available through the app’s chat or phone.

• Gradual Availability: NuViagens will be rolled out gradually and can be accessed in the Nubank Ultravioleta app under the "Ultravioleta Benefits" and "Travel and Leisure" sections.

Source: Nubank IR

My Perspective: I don’t know about you, but I get the feeling that NU is turning into the everything app—or dare I say it, a super app.

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4. Amazon (Ticker: AMZN) to Invest Billions in European Data Centre Expansion

Amazon's cloud computing division, AWS, is it talks with Italy to invest billions to expand its data center operations in the country. AWS launched its first cloud region in Italy in 2020 with a plan to invest €2 billion by 2029.

AWS recently announced a €15.7 billion investment in Spain, significantly increasing from a previous plan of €2.5 billion. In Germany, AWS plans a €7.8 billion investment by 2040.

Source: Reuters

My Perspective: AWS is strategically expanding its cloud infrastructure in Europe, aligning with increasing demand and regulatory requirements to store data within the European Union. To put Amazon’s scale into perspective, the €15.7 billion investment in Spain is equivalent to the GDP of Malta, where the NEXT Summit was held.

5. The Technological Evolution at MercadoLibre (Ticker: MELI)

This week, I came across a great article from Juliano Marcos Martins, a Senior Technology Manager at MELI. It details the technological evolution as MELI transitioned from a monolithic architecture (1999) to a microservices-based infrastructure (2010) called MeliCloud, and finally to the Fury platform (2015). The evolution aimed to address scaling challenges, improve deployment frequency, and enhance developer productivity.

Fury is MELI's Internal Developer Platform (IDP) providing a unified, self-service environment for efficient application creation, deployment, management, and monitoring. It was developed to support the exponential growth and complex ecosystem of MELI, with a focus on scalability, integration, and security.

Source: MercadoLibre Tech

My Perspective: MELI's journey from a monolithic architecture to a sophisticated multicloud platform underscores its commitment to being a technology-first company. A lot of companies make this claim, but few can prove it. In MELI’s case, software engineer headcount has increased 8x in 5 years to more than 16,000 people.

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6. Wedbush Research on Airbnb (Ticker: ABNB)

Wedbush sees ABNB as an attractive buying opportunity following its conservative second-quarter guidance, which has contributed to recent stock underperformance. The brokerage upgraded ABNB's stock rating to outperform from neutral and raised the price target to $165 from $160. The analysts suggest that investors should capitalize on the current period of relative weakness, expecting an upside in near-term estimates due to positive travel trends.

Wedbush increased its Q2 revenue forecast slightly to $2.74 billion and EPS target to $0.88. The consensus among analysts is a revenue of $2.72 billion and GAAP EPS of $0.90. For the full year, Wedbush raised its revenue estimate to $11.27 billion from $11.15 billion and its EPS estimate to $4.34 from $4.19. The consensus forecasts for 2024 are $11.17 billion in revenue and $4.52 in GAAP EPS.

Source: MT Newswires

My Perspective: Wedbush’s commentary is consistent with my own analysis after the Q1 earnings, where I wrote that the perceived weakness was not warranted given that the full-year guidance had not been lowered. The upcoming events in Europe, like the Paris Olympics and the Euro 2024 Championships, will boost summer travel. The full analysis of the Q1 earnings is linked below.

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Wolf of Harcourt Street

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Market Movers is your time-saving guide to crucial stock news, cutting through the noise.

It's been a while since I shared this segment of the newsletter, but I am resurrecting it based on subscriber feedback. A lot of news happens, and this segment aims to capture it all in one place so that you don’t have to go looking for it.

With all that being said, let’s dive into today’s edition!

Todays Agenda

1. Nu to Enter Telecom Market

2. Adyen Keeps Adding Customers

3. Evolution Plans New U.S Headquarters

4. MercadoLibre Applies for Digital Banking Licence in Mexico

5. DSB Research on Sea Limited

1. Nu (Ticker: NU) to Enter Telecom Market

NU has received approval to operate as a mobile virtual network operator (MVNO) using Claro's infrastructure with the service expect to launch in Q3.

Traditional MVNOs face challenges due to the high costs of purchasing data capacity wholesale, limiting their ability to compete with established telcos. NU has subverted this model by securing a revenue-sharing agreement with Claro, rather than purchasing capacity wholesale. This will result in little to no Capex for NU and result in healthy profit margins.

NU’s low acquisition and serving costs should provide a competitive edge as they already hold a 22% share of the prepaid plan top-up market. Analysts estimate that NU could capture 11 million prepaid customers and 7.5 million postpaid customers within three years, equating to 7% of Brazil's mobile phone market.

The telecom sector in Brazil has become less competitive after Oi's exit from the mobile market. Companies have been able to increase prices and grow revenue above inflation due to reduced competition. The entry of Nubank as an MVNO could disrupt the market by introducing aggressive pricing and innovative service models.

Source: Brazil Journal

My Perspective: Unlike legacy banks, what is the one thing that users need to access NU? The answer is internet connectivity. That is why this move makes so much sense for NU.

2. Adyen (Ticker: ADYEN) Keeps Adding Customers

Adyen has been very busy this week, announcing two new partnerships, both on the same day!

Addmind

Adyen, has partnered with Addmind, a leading hospitality group, to enhance payment experiences at Addmind’s venues in the UAE and globally.

The collaboration includes integrating Adyen with SevenRooms, a hospitality marketing and operations platform, which addresses payment inefficiencies, reduces no-shows, and supports preferred payment methods like American Express.

Addmind has adopted Adyen's fully integrated POS solution, enabling pay-at-table functionality, easier bill splitting, and direct tipping from payment devices, leading to increased average tips and reduced staff admin load. The collaboration has resulted in noticeable improvements, including decreased no-shows and faster service delivery, which support Addmind's expansion goals.

As Addmind expands globally, including new venues in London and Ibiza, the partnership with Adyen will ensure streamlined payment processes and a superior guest experience across all locations.

Source: Adyen Press and Media

Vapiano

Adyen has partnered with Vapiano, an Italian restaurant group, to enhance customer experiences.

Adyen's technology allows customers to customize their checkout experiences and order food via their phones using digital wallet payments. A pilot in a London branch showed 80% of orders were made via mobile, indicating high demand for faster, seamless ordering and highlighting a need for more payment options.

Adyen's research indicates 54% of consumers abandon the checkout if their preferred payment method isn't available, and 27% no longer carry wallets. Vapiano expects increased loyalty and improved operational efficiency from Adyen's fast, reliable, and secure systems, leveraging customer data to analyze trends.

Source: Adyen Press and Media

My Perspective: Adyen has been announcing new partnerships on an almost weekly basis. Adyen’s land-and-expand business model means that 80% of its growth comes from existing customers. It will not be visible in the 1H 2024 earnings but future payment volumes are being onboarded.

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3. Evolution (Ticker: EVO.ST) Plans New U.S Headquarters

Evolution’s plans for a $75 million, four-story, 130,000-square-foot building at Atlantic City have received support from the Casino Reinvestment Development Authority (CRDA). Evolution, already operating in Atlantic City, needs more space due to current constraints. The new building will address this need, allowing expansion from 850 to approximately 2,000 employees.

The proposed building will include studio, office space and data warehousing. The CRDA board's preliminary vote was mostly unanimous, with final approvals still needed. The building, projected to open in 2026, will serve as a flagship facility for Evolution in the U.S., adhering to online gaming laws that require multiple state locations.

Source: Press of Atlantic City

My Perspective: This is very welcome news and shows that management is taking proactive measures to increase capacity for US expansion.

4. MercadoLibre (Ticker: MELI) Applies for Digital Banking Licence in Mexico

Mercado Pago, the fintech arm of MELI, will apply for a banking license in Mexico to become the largest digital bank in the country, aiming to provide comprehensive banking services including savings and checking accounts, commercial loans, and mortgages. The license application process is expected to take 12 to 24 months, starting at the end of summer.

Mercado Pago already offers various digital financial services under an IFPE fintech license in Mexico, such as credit and debit cards, international transfers, interest on digital wallet funds, and loans. The Mexican market, with less than half the population having bank accounts, is a key focus for fintechs.

MELI plans significant investments in Mexico, including creating 8,200 jobs and allocating $2.5 billion to its operations, supported by lending agreements with major banks like Goldman Sachs, Citigroup, and JPMorgan Chase.

Source: Reuters

My Perspective: While this is a decision that should come as no surprise to anyone given the trajectory Mercado Pago has been on, it now positions it for a direct collision course with NU in the rapidly growing digital banking market in Mexico.

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5. DSB Research on Sea Limited (Ticker: SE)

DSB released a note on SE after it reported Q1 earnings, maintaining a buy rating and raising the price target to $96. While price targets are generally not worth the paper they are written on, it is useful to understand the narrative driving it.

DBS noted that the Q1 adjusted EBITDA of $401 million significantly exceeded the consensus estimate of $240 million, with the improvement driven by narrower e-commerce losses. The e-commerce Gross Merchandise Volume (GMV) of $23.6 billion surpassed the consensus estimate of $22.5 billion by over $1 billion.

Overall, DBS raised its price target due to raising e-commerce revenue forecasts for FY24 and FY25 by 14% and 20%, resulting in overall revenue increases of 10% and 15%. They raised the valuation of e-commerce to 2.5 times 12-month forward EV/Revenue, aligning with global peers trading at an average of 3. They value the gaming and fintech business at 12 times EV/EBITDA.

Source: DBS

My Perspective: The commentary from DBS aligns with my own analysis of the SE Q1 earnings, where I anticipated that analysts would adjust estimates upward once they fully digest the Q1 results.

If you'd like to support the work of an independent analyst, you can buy me a coffee. The proceeds will contribute to covering the annual running costs of the newsletter.

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Wolf of Harcourt Street

Contact me

Twitter: @wolfofharcourt

Email: wolfofharcourtstreet@gmail.com