💰 $157 Billion In Cash

1) Palantir’s Rapid Growth 2) Berkshire Hathaway’s Treasure Chest, 3) AirPods Empire, and more!

Happy Tuesday.

Hope you all had a great weekend. Some key data bites you should know: 

  • U.S. October job growth slowed to 150,000, below the expected 170,000, suggesting a cooling economy and possibly easing the Fed's inflation battle.

  • Disney $DIS will acquire the 33% Hulu stake from Comcast for a minimum of $8.6B, gaining full control of the company.

  • Starbucks $SBUX will hike U.S. hourly employee pay by at least 3% in January and begin accruing paid vacation after 90 days.

  • Tesla $TSLA is planning to build a $25,000 electric car at its Berlin Gigafactory, potentially making it its most affordable model yet.

In today’s newsletter:

  • 🦾 Palantir’s Rapid Growth

  • 💰 Berkshire Hathaway’s Treasure Chest

  • 🎧 AirPods Empire

Let’s dive right in!

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🦾 Palantir’s Rapid Growth

Palantir has been on a run the last few days after it surpassed earnings expectations with it’s third-quarter report, marking its fourth consecutive profitable quarter and raising its full-year revenue forecast. The company, known for its defense and intelligence services, also reported strong U.S. commercial revenue growth and increased its customer base by 37%.

Palantir reported revenue of $558M and adjusted income of $163M for the quarter. CEO Alex Karp attributes this growth to high demand for their AI platform, which contributed to closing over 80 deals worth $1M or more. The company sees full-year revenue of $2.216B - $2.22B, above the original $2.212B estimate and projects continued profitability, making it eligible for the S&P 500 index.

💰 Berkshire Hathaway’s Treasure Chest

Warren Buffett is sitting comfortably on his treasure chest of cash. His company, Berkshire Hathaway, had $157.2B in cash on hand at the end of the quarter. The company reported earnings on Saturday, and saw a $12.8B loss in the third quarter due to unrealized investment losses. Despite this, its operating profit, a better indicator to analyze the company, surged nearly 41% to $10.8B, with its insurance units delivering a robust performance.

Berkshire Hathaway has faced challenges in finding substantial acquisitions to deploy its significant cash reserves, but it has recently increased activity with the purchase of shares in Occidental Petroleum and an $11.6B acquisition of Alleghany Corp. To add on, Buffett has used share repurchases as a way to return value to shareholders, spending $1.1B on buybacks in the latest quarter, totaling about $7B for the first nine months of the year. Berkshire has been a net seller of equities, reducing its stock holdings by almost $15.7B in Q3.

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🎧 AirPods Empire

While many investors know that Apple’s iPhone makes up roughly 52% of its net sales, it’s easy to overlook the sheer size of the rest of its revenue segments. Apple’s Wearables, Home and Accessories segment includes its popular smartwatches and wireless headphones. In the last twelve months, this category did $39.8B in net sales. This is bigger than the revenue of some of the most recognized companies in the world such as Starbucks, Uber, Netflix, Nvidia, and McDonald’s.

5 years ago in 2018, Apple’s Wearables, Home and Accessories did $17.4B in trailing twelve month revenue. While Apple has been able to grow this segment by roughly 129% over the last few years, the segment is starting to see some decline, with sales falling 3% in the last quarter. Investors will look to see if Apple can continue to innovate in this category to reinvigorate higher demand.

🤖 Meet Grok. Elon Musk's xAI debuted Grok, an AI designed to handle complex inquiries, currently in beta and positioned as a competitor in the AI market. [CNBC]

🇰🇷 Short Selling Ban. South Korean stocks jumped after a ban on short-selling, aimed at appealing retail investors. [BB]

🏦 New Disney CFO. Disney $DIS has hired ex-PepsiCo exec Hugh Johnston as CFO to aid in restructuring and tackling challenges in its streaming and TV units. [R]

🐝 Bumble Struggles. Whitney Wolfe Herd stepped down as Bumble's $BMBL CEO, succeeded by Slack's Lidiane Jones. [WSJ]

Notable Companies Reporting Earnings This Week:

  • Monday:

    • Ryanair $RYAAY, BioNTech $BNTX, Freshpet $FRPT, Vertex Pharma $VRTX, NXP Semi $NXPI, Realty Income $O, Diamondback Energy $FANG

  • Tuesday:

    • Uber $UBER, UBS $UBS, Emerson Electric $EMR, KKR $KKR, Datadog $DDOG, Celsius $CELH, Squarespace $SQSP, Gilead Sciences $GILD, Occidental Petroleum $OXY, Coupang $CPNG, eBay $EBAY, Rivian $RIVN, Lucid $LCID, Toast $TOST, Robinhood $HOOD, Cava $CAVA

  • Wednesday:

    • TC Energy $TRP, Warner Bros $WBD, Roblox $RBLX, Ralph Lauren $RL, Disney $DIS, Take-Two $TTWO, HubSpot $HUBS, MGM Resorts $MGM, Lyft $LYFT, Affirm $AFRM, Twilio $TWLO

  • Thursday:

    • Sony $SONY, AstraZeneca $AZN, Li Auto $LI, Wix $WIX, TradeDesk $TTD, Illumina $ILMN, Plug Power $PLUG

  • Friday:

    • Algonquin $AQN, Soho House $SHCO

All of the companies that are reporting earnings this week can be viewed here.

Major Trades Published Week of 10/30. Trades may be those of family members. [Source: 2iQ]

Buys:

  • Tom Carper (D)

    • Company: Ranger Equity Bear ETF ($HDGE)

      • Amount Purchased: $3K - $45K

    • Company: Revance Therapeutics ($RVNC)

      • Amount Purchased: $1K - $15K

  • Markwayne Mullin (R)

    • Company: AMD ($AMD)

      • Amount Purchased: $1K - $15K

    • Company: Alphabet ($GOOG)

      • Amount Purchased: $1K - $15K

    • Company: Apple ($AAPL)

      • Amount Purchased: $1K - $15K

    • Company: Eli Lilly ($LLY)

      • Amount Purchased: $1K - $15K

Sells:

  • Katherine Clark (D)

    • Company: Coca-Cola ($KO)

      • Amount Sold: $15K - $50K

  • Tom Carper (D)

    • Company: ProShares Short QQQ ($PSQ)

      • Amount Sold: $3K - $45K

  • Jonathon Jackson (D)

    • Company: DTE Energy ($DTE)

      • Amount Sold: $15K - $50K

    • Company: NextEra Energy ($NEE)

      • Amount Sold: $15K - $50K

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