Finance

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Shares of GameStop shot to session highs Thursday after meme stock leader “Roaring Kitty” scheduled a livestream on YouTube, which would be his first one in almost four years.
Roaring Kitty, whose real name is Keith Gill, set the time for his live chat at noon Friday, which traders speculated would be a bullish discussion about his massive GameStop stake. The investor hosted three-hour livestreams in August 2020 explaining his investing thesis behind his favorite brick-and-mortar video game retailer.

GameStop popped more than 47% higher to close at $46.55 per share. The stock hit a high of $47.50 during the session, in which trading was briefly halted for volatility. The stock has more than doubled so far this week.

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GameStop, 1-day

There were already more than 10,000 people waiting in the livestream and countless comments were flowing through the chat box.
Gill, who goes by DeepF——Value on Reddit, resurfaced online recently more than three years after sparking the historic trading mania in 2021 that burned short-selling hedge funds. Last Sunday, he started posting screenshots of his E-trade portfolio holding five million shares of GameStop common shares and 120,000 call options. Combined, they have a market value of at least $200 million now. He seemed to have held onto his positions as of Thursday night.
Those call options, if exercised, could bring Gill’s stake in GameStop to 17 million shares. If the stock returns to its May high of $64.83 per share, Gill’s position would then be worth more than $1 billion.
Gill had paused posting updates during the week after The Wall Street Journal reported that Morgan Stanley’s E-Trade broker was considering booting him because of the worry that what he was doing could amount to market manipulation. 

CNBC has not independently verified Gill’s holdings.
The investor is a former marketer for Massachusetts Mutual Life Insurance. The mania in 2021 led to a series of congressional hearings, featuring Gill, around brokers’ practices and gamifying retail trading. More

Lower-income U.S. consumers are feeling stretched with their spending, Five Below CEO Joel Anderson said Wednesday.
The company’s revenue for the first quarter of fiscal 2024 came in lower than expected and it posted weak revenue guidance.
His comments come as consumer sentiment has been lagging despite some progress on inflation.

A shopper browses a selection of body boards outside a Five Below store in Bloomington, Illinois, on July 25, 2018.
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While inflation is showing signs of easing, consumers in the country may still be feeling its effects for quite some time, according to Joel Anderson, CEO of discount retailer Five Below. The executive sees underperformance particularly in the lower-income demographic.
“The lower-end customer is really being stretched,” Anderson said on an earnings call with analysts Wednesday. “We’ve got to deliver value, and we’ve got to really display that in how we go to market, and when you walk in the store, what you see. But all that’s in flight right now, and [we] expect to see some of those changes improve by back half of the year.”

Five Below issued soft revenue guidance for the second quarter and the full year. Revenue for the first quarter also came in below expectations.
Shares plummeted nearly 11% Thursday, hitting a new 52-week low during the trading session. The retailer is down more than 44% in 2024.
“Consumers were more discerning with their dollars, increasingly buying to need,” Anderson added. The types of products they’ve been purchasing reflect this, he added, noting that consumers bought more in the company’s “consumable” categories such as candy, food and beverage, beauty and health and beauty aids.
The CEO also noted that Five Beyond — the company’s in-store shop that sells some products for more than $5 — performed the best among its lower-income household stores. This, he said, indicates that when consumers see the value of products, the more they have to “stretch their dollar.”
Though there has been some indication that aspects of the U.S. economy are improving, consumer sentiment has been lagging. In fact, consumer sentiment dropped more than 10% in May, according to the University of Michigan Survey of Consumers. Not only that, more than half of Americans falsely believe the country is in an economic recession.
“The quarter solidified that consumers are feeling the impact of multiple years of inflation across many key categories, such as food, fuel and rent, and are therefore far more deliberate with their discretionary dollars,” Anderson said.

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Salesforce said Thursday it will open its first, flagship artificial intelligence center in the U.K., in London’s Blue Fin Building.
The center, part of Salesforce’s $4 billion investment in the U.K., will be used to encourage industry collaboration as well as facilitate AI training and upskilling programs.
Salesforce also revealed that its venture arm, Salesforce Ventures, has invested more than $200 million into U.K. startups, including AutoGen AI and Eleven Labs.

A Salesforce corporate logo hangs over the front door of the Salesforce Tower on January 22, 2024, in New York City.
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LONDON — Enterprise tech giant Salesforce is opening an artificial intelligence center in London, making a bullish bet on the U.K. as a global technology hub.
The U.S. software giant said in a statement Thursday that it is opening a more-than-40,000-square-foot facility in London’s Blue Fin Building, which can host over 300 people.

It will be used to encourage industry collaboration among tech firms, AI experts, Salesforce partners and customers, the company said, as well as facilitate AI training and upskilling programs.
Salesforce said it expects the AI center to play a role in creating 500,000 AI-related jobs in the U.K.
The facility will officially open June 18 with a free event to train more than 100 developers.

Salesforce said the center, which is planned to be the first of many globally, would support its U.K. and Ireland business. It will be led by the firm’s U.K. and Ireland CEO, Zahra Bahrololoumi.
The news was announced at the Salesforce World Tour event at the London Excel venue on Thursday, which is expected to see more than 17,500 delegates and customers gather from companies including Aston Martin, McLaren, Just Eat Takeway and John Lewis.

“By locating Salesforce’s first, flagship AI center in London, we are sending a clear message to customers and partners on AI: we are deeply committed to working closely together so that you can reap the rewards of this transformative technology, while ensuring it is a force for good,” Salesforce’s Bahrololoumi said in a statement.

$4 billion investment in UK

The AI center forms part of a $4 billion investment in the U.K., which Salesforce committed to make over five years in 2023.

In addition to announcing the opening of its AI center, Salesforce also revealed that it had invested more than $200 million into U.K. startups via its venture capital arm, Salesforce Ventures. These include the procurement bid writing platform AutoGen AI and Eleven Labs, an AI-powered text-to-speech and voice generator.
Patrick Stokes, executive vice president of product and industries marketing, said the U.K. was a “really interesting place to
a really interesting place to do it, because some of the challenges here with AI and data are, in some cases a little bit more difficult to solve than they are in the US, there’s a little bit more regulation here. And consumer protection. And that somewhat counter intuitively, that’s a good thing for us as, as enterprise developers, because if we can solve those problems here, we’ve kind of solved them for everywhere. So typically, you want to kind of lean into the more challenging environments, from a from a product development standpoint, and learn as much as you can, it, as you know, is more challenging environments. We expect to see more of that type of regulation and consumer privacy protection. There are parts of the United States where we were where we see it emerging, we’d like to see more so. So I think leaning into the UK is a smart decision for us. And it ties in very nicely to the commitment that we made, probably right here in this room last year.
For a billion investment in the UK.
The news comes amid concerns over whether Salesforce’s investments into AI are paying off. The company last week reported weaker-than-expected fiscal first-quarter revenue and issued guidance that fell short of investor expectations.
Salesforce reported revenue of $9.13 billion for the period, up 11% from a year ago but below analyst expectations of $9.17 billion. The company said it expects adjusted earnings of $2.34 to $2.36 per share for the current quarter, lower than the $2.40 per share expected by analysts. More

“Equities in Dallas,” cried the traders in “Liar’s Poker”, an account by Michael Lewis of his life as a junior banker in the late 1980s. Demotion from New York to the backwater of Texas would be a humiliation. Who wants to sling shares to yokels?Times may be changing. On June 4th an upstart Texas Stock Exchange (TxSE) said it had received $120m in funding from financial giants including BlackRock, a fund manager, and Citadel Securities, a marketmaker. The TxsE will, its boss wrote, be the best-capitalised challenger to the New York Stock Exchange. More

Days after Vladimir Putin’s invasion of Ukraine, Raiffeisen, an Austrian bank, said it was considering selling its business in Russia. Twenty-seven months later, the lender’s unit in the country is doing rather well. Its staff has grown to nearly 10,000, a 7% rise since 2022. Last year its profit reached €1.8bn ($2bn)—more than any of the bank’s other subsidiaries and a tripling since 2021. Raiffeisen is one of a dozen lenders that Russia deems “systemically” important to its economy. The bank also matters to the Kremlin’s own finances, since it paid the equivalent of half a billion dollars in tax last year.Raiffeisen is the biggest Western bank in Russia, but not the only one. The combined profits of the five EU banks with the largest Russian operations have tripled, reaching nearly €3bn in 2023. Success makes the banks a target. In May America threatened to curb Raiffeisen’s access to its financial system because of the bank’s Russian dealings. On June 10th, in an attempt to placate critics, the lender plans to stop making dollar transfers out of the country. Russia, for its part, is starting to seize the assets of Western banks it deems “unfriendly”. Western lenders’ Russian paper profits are at risk of turning to ash. More

Many people have experienced the joy of finding some spare change down the back of the sofa. On May 30th the World Bank experienced something similar, if on a grander scale. After rooting around in 176 countries, it discovered almost $7trn in extra global GDP—equivalent to an extra France and a Mexico.In fact, there may be a better analogy. What the World Bank discovered was not additional money to spend, but the equivalent of a discount voucher, which cuts 4% off the price of every good and service the world buys in a year. That means global spending can stretch further than previously thought. More

Bulgarian-founded corporate card startup Payhawk said it is searching for startups in the world of corporate spend management to acquire.
Payhawk’s acquisition drive comes after considerable growth for the fintech, which said it saw an 86% increase in revenue in the first quarter.

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AMSTERDAM, Netherlands — Corporate payments startup Payhawk told CNBC it is planning mergers and acquisitions to grow its footprint in the corporate spend management world and take on big players like SAP.
The startup said it is looking to acquire a company or companies at the series A stage of their development, referring to early-stage startups that have already raised a significant round of funding.

In an interview with CNBC, Hristo Borisov, Payhawk’s CEO and co-founder, said he thinks his firm has a better “product-market fit” than its rivals, which have gained multibillion-dollar valuations by handing out free corporate cards to other startups.
“We see an opportunity to have much better unit economics in this business,” Borisov told CNBC at the Money 20/20 conference in Amsterdam, Netherlands, this week. “We believe companies like Brex and Ramp still haven’t found strong product market fit for what this potential market is going to be.”
Payhawk is a corporate spend management platform that issues smart cards for clients’ employees to make payments and keep track of their expenses. Decathlon and Vinted are among its customers.

Consolidation the name of the game

Payhawk recorded huge growth in the first quarter, the company told CNBC. It revealed that revenue climbed 86% globally year-over-year, and sales jumped 127% in the U.K. — a market that now makes up 27% of overall revenue.
Payhawk’s growth came off the back of a significant increase in clients. The firm said it saw a 58% increase in customers year-over-year in the three months ending March, with the U.K., again, a major driver.

Now, Payhawk wants to build on that growth — with M&A key to unlocking future opportunities, according to Borisov.
“Many businesses that got funded in last two or three years are now in a position where they’re looking at strategic options,” Borisov said. “This is something we’re actively doing. We’re looking for companies to buy.”
“Our vision is to be able to provide a single platform that provides a homogeneous environment your corporate expense needs with a single provider,” Borisov said. “There is going to be some market consolidation.”
Borisov isn’t looking for companies in the U.S. market to acquire, Borisov said, adding that in the U.S., Payhawk is partnered with American Express under the credit card giant’s Sync Commercial Partner Program.

Goal to become a public company

Asked whether his firm was looking to raise new venture funding to achieve its objectives, Borisov said that Payhawk is always in fundraising conversations.

He added that its renewed growth over the past year had garnered interest from external investors, after a tougher 2022 and early 2023.
“Fundraising is everyday,” he said. “It’s not because we need money. The worst time to fundraise is when you need the money.”
“We’re speaking to investors daily, understanding where the market is,” Borisov added. “Partners who do believe in that vision see the same way.”
Payhawk may look to raise a new venture round either this year or next year, Borisov added. The firm, backed by venture firms Lightspeed, Greenoaks, and Earlybird, has raised $240 million to date.
He said his ultimate goal is for Payhawk to become a publicly listed company, though there’s no date yet for the firm to launch a public market debut.
“Our ultimate goal is to IPO the company, this is something we’re focused on,” Borisov said. “This really depends on the market conditions and market realities.” More

On June 7th each share in Nvidia is due to become many. In one sense such stock splits ought not to matter much: they merely lower the share price, usually returning it to somewhere near $100, in order to make small trades easier. Yet for the company and its longtime backers this administrative exercise is cause to pop the champagne. For a split to be necessary in the first place, the share price must have multiplied, commonly by two or three, prompting each share to be divided by the same factor. Each Nvidia share, however, will become ten. Two years ago both Alphabet and Amazon split each of their shares into 20. Investors in big tech have had plenty of opportunities to let the corks fly.All three firms have made traditional valuation measures look hopelessly outdated. Dividend yields, for instance, were once a popular tool for assessing prospective returns. But Amazon has never made such a payout and Alphabet will make its first ever on June 17th (of 20 cents per $175 share). Nvidia’s quarterly dividend after the split will be just one cent per share, each priced at around $120. Plainly, there is no stretch of the imagination by which these payouts explain the stocks’ spectacular returns. More