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London banking startup Revolut is now worth $1.7 billion — just 33 months after launching

20 hours 59 min ago

  • Fintech Revolut raised $250 million at $1.7 billion valuation.
  • Russian billionaire Yuri Milner's DST Global led the funding round.
  • Funding will fuel international expansion and hiring.
  • Revolut started as a no-fee foreign exchange app but has expanded into banking and insurance.

LONDON — Financial technology startup Revolut has raised $250 million in a blockbuster "Series C" funding round.

The investment, one of the largest-ever in European fintech, values Revolut at $1.7 billion. It means the 33-month-old company has grown its valuation by more than five times in a year. Revolut says the funding round make it one of the fastest European tech companies to become a "unicorn." A "unicorn" is a tech industry term for a private company valued at over $1 billion.

London-headquartered Revolut began as a no-fee foreign exchange card, linked to an app, but has rapidly expanded to offer everything from travel insurance and property investment to cryptocurrency trading. It is currently applying for a banking license in Lithuania.

The app has 2 million users globally and claims to have 250,000 daily active users. Revolut is currently processing $1.8 billion of transactions per month and says it is signing up as many as 8,000 new users per day.

The funding round was led by DST Global, the investment vehicle of Russian billionaire Yuri Milner who was an early investor of Facebook, Twitter, Spotify, and Airbnb, among others. Revolut's existing investors Index Ventures and Ribbit Capital also took part in the round.

CEO and founder Nikolay Storonsky said in a statement: "Our focus, since we launched, has been to do everything completely opposite to traditional banks.

"We build world-class tech that puts people back in control of their finances, we speak to our customers like humans and we’re never afraid to challenge old thinking in order to innovate."

DST Global's Tom Stafford said: "Revolut is developing and delivering technology that reduces the complexity and cost of financial services for consumers and small businesses." He added, "We are delighted to support Nik and the Revolut team as they continue to innovate, roll out new services and expand geographically."

The fresh cash injection will be used to boost hiring and fuel expansion. The startup wants to be in the US, Canada, Singapore, Hong Kong, and Australia by the end of the year. It also expects to increase its workforce from 350 to around 800 employees. Revolut said it wants to reach 100 million customers globally within five years.

The funding takes the total raised by Revolut to $340 million and comes amid a wave of huge investment into app-only banks in Europe. In March, Germany's N26 raised $160 million and Britain's Atom raised £149 million.

SEE ALSO: A tech VC explains why Revolut is such a hot ticket as the fintech app hits 1 million users

DON'T MISS: German app-only bank N26 raises $160 million from Allianz and Tencent to crack the US

NEXT UP: Fintech startup Revolut is signing up 40 new business customers every day

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Fintech could be bigger than ATMs, PayPal, and Bitcoin combined

Wed, 04/25/2018 - 10:02pm

This is a preview of a research report from Business Insider Intelligence, Business Insider's premium research service. To learn more about Business Insider Intelligence, click here.

Fintech broke onto the scene as a disruptive force following the 2008 crisis, but the industry's influence on the broader financial services system is changing. 

The fintech industry no longer stands clearly apart from financial services proper, and is increasingly growing embedded in mainstream finance. We’re now seeing the initial stages of this transformation.

For instance, funding is growing more internationally distributed, and startups are making necessary adjustments to prove sustainability and secure a seat at the table. Most fintech segments in the ascendant a year ago have continued to rise and grow more valuable to the broader financial system. Meanwhile, several fintech categories have had to make adjustments to stay on top. New subsegments are also appearing on the scene — such as digital identity verification fintechs — as new opportunities for innovation are discovered. 

Significantly, incumbents are responding more proactively to the rising influence of fintech by making updates to their consumer-facing channels, back-end systems, and overall business operations. Most are realizing that the best way to adapt is to work alongside the fintechs that are transforming the financial services environment, either by partnering with them or acquiring the startups entirely. As fintech's power grows, incumbents will have no choice but to change in order to stay relevant and competitive. All around, fintech is becoming embedded in mainstream finance.

Business Insider Intelligence, Business Insider's premium research service, has written the definitive Fintech Ecosystem report that looks at the shifts in the broader environment that fintechs operate in, including funding patterns and regulatory trends; examines the adaptations that some of fintech's biggest subsegments have had to make to secure a foothold in the financial services system; and discusses how the continued rise of the fintech industry is pressuring incumbents to make fundamental changes to their business models and roles. It ends by assessing what a global economy increasingly influenced by innovative fintechs will look like.

Here are some key takeaways from the report:

  • The fintech industry is far more than a group of digitally native, consumer-centric startups, although they are, in many ways, becoming the new face of financial services. It's increasingly clear that fintech no longer stands apart from financial services proper, and is morphing into an integral part of the financial system. 
  • To secure their position in the mainstream economy, some of the main fintech subsegments have had to adjust their business models. These include neobanks, robo-advisors, and alt lenders. Other fintech categories, meanwhile, have instead found that current conditions are well suited to their original models, and are seeing largely smooth sailing, like regtechs, insurtechs, and payments fintechs. Innovation and dynamism is still alive in fintech too, with new categories still emerging.
  • The rising influence of fintechs is having a dramatic effect on incumbents, from banks to insurers to wealth managers, pushing them to respond proactively to stay relevant. Incumbents are reacting to changes wrought by fintechs on three key fronts: the front end, the back end, and in their core business operations. As such, incumbents and fintechs are converging on a digital middle ground.
  • As this happens, the fintech industry is on the cusp of becoming an integral component of the broader financial services ecosystem. But it will likely first have to go through a complete credit cycle, and survive an economic downturn like the one that set the stage for its arrival in 2008, for this to happen.

In full, the report:

  • Looks at how the environment in which the fintech industry operates is changing, and what that means for the digitization of financial services.
  • Gives an overview of the main subsegments within the global fintech industry, and discusses which categories have had to adapt to survive, which have reaped benefits from their original game plans, and which new segments have come to the fore in the past twelve months.
  • Outlines the adaptations that incumbent financial institutions have begun making to adjust to an economy that's inevitably shifting to digital, and in which tech-savvy fintechs are increasingly setting the standards.
  • Discusses what the future of financial services will look like as fintech embeds itself into the financial mainstream.
Subscribe to an All-Access membership to Business Insider Intelligence and gain immediate access to: This report and more than 250 other expertly researched reports Access to all future reports and daily newsletters Forecasts of new and emerging technologies in your industry And more! Learn More

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THE EVOLUTION OF ROBO-ADVISING REPORT: How automated investment products are disrupting and enhancing the wealth management industry

Wed, 04/25/2018 - 9:04pm

This is a preview of a research report from Business Insider Intelligence, Business Insider's premium research service. To learn more about Business Insider Intelligence, click here.

Startups with robo-advisor products are failing to live up to their initial promise.

As solutions proliferate and consumer adoption remains slower than expected, many firms are re-examining and updating their strategies to survive. 

In a new report, Business Insider Intelligence scopes the current market for robo-advisors, providing an updated forecast through 2022. In addition, we explain the different types of robo-advisors emerging, detail how startups and incumbents are working to ensure the success of their products, and outline what will happen to the market over the next 12 months.

Here are some of the key takeaways from the report:

  • Business Insider Intelligence forecasts that robo-advisors — investment products that include any element of automation — will manage around $1 trillion by 2020, and around $4.6 trillion by 2022. 
  • Startups offering robo-advisors are struggling to acquire AUM due to overcrowding in the global robo-advisory market and lower than expected customer uptake. 
  • Incumbents are rolling out their own robo-advisor products, a trend we expect to pick up in the period to 2022. 
  • North America remains the leading robo-advisory market, but we expect Asia to catch up and outpace the region in terms of AUM managed by robo-advisors in the period to 2022. 
  • There will be a winnowing of the startup robo-advisory market as only a few firms remain stand-alone, while incumbents looking to launch their own products will profit from purchasing the technology of startups that have fallen by the wayside, at low cost. 

 In full, the report:

  • Provides a forecast for the volume of assets robo-advisors will manage by 2022.
  • Outlines the current robo-advisory landscape.
  • Explains how startups with robo-advisor products are evolving their business strategies. 
  • Provides an outlook for the future of the robo-advising industry. 
Subscribe to an All-Access pass to Business Insider Intelligence and gain immediate access to: This report and more than 250 other expertly researched reports Access to all future reports and daily newsletters Forecasts of new and emerging technologies in your industry And more! Learn More

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Adidas just opened a futuristic new factory — and it will dramatically change how shoes are sold

Wed, 04/25/2018 - 9:00pm

  • Adidas' Speedfactory in Atlanta is open, producing shoes like the new AM4NYC limited collection.
  • The factory is completely automated, and designed to be able to speedily produce limited runs of customizable product or replenish the hottest product selling quickly during the same season.
  • Adidas said it can get shoes to market three times faster in a Speedfactory than with traditional means.
  • The Atlanta location is Adidas' second Speedfactory, with the first in Germany. In conjunction, Adidas said it hopes the two factories can produce one million pairs of shoes a year by 2020.
  • Adidas will continue to experiment with the Speedfactories, adding new technology and more automated processes to get to a goal of 50% of shoes made by with speedier methods.

Adidas' American Speedfactory is open for business.

The 74,000-square-foot facility in Cherokee County, Georgia, outside Atlanta, is now pumping out shoes using a completely automated digital manufacturing process.

The first shoes produced and sold from the factory, the new AM4NYC (Adidas made for New York City), created specifically for New York's urban streets, will go on sale Thursday.

The shoes were made for quickly changing directions on urban streets using Adidas sports-science data, and are an example of the combination of speed and flexibility the new factory offers, as well as its ability to create specific and custom footwear.

As the name implies, the Speedfactory is about speed

"We have ambition to have 50% of our sales [from] under what we call speed programs," Gil Steyaert, an Adidas executive board member responsible for global operations, told Business Insider. "That means that product, which would be reproduced or created in the season [is] for the same season." 

The speed initiative is "very much aiming at the fast fashion model where we can bring product closer to the consumer," Steyaert said.

Closer to the consumer also means physically closer — that is, produced in North America, not Asia, where the majority of Adidas shoes are made. That makes it much quicker to ship the shoes throughout the continent, and the shoes can be made specifically for the American market, which has been the major focus for the brand and part of its stellar performance in the last few years.

The Speedfactory is fast, but flexible

The Speedfactory can create more inventory for a hot shoe that's flying off shelves and can't be kept in stock,  supplementing other inventory shipped over from Asia. Or the factory can create entirely new shoes specifically for the market as part of a limited run.

Eventually, Steyaert says customers may be able to create their own completely custom, one-of-a-kind Adidas shoes designed to their own specifications online. Things like patch placement and details on the uppers of shoes would be able to be customized.

"Speedfactory is able to customize the shoe indefinitely while being in an automated engineering process," Steyaert said. "We can actually tune the shoe to the customization that the consumer wants to have. That's the goal: full customization, but without compromise on speed."

The fully automated factory means shoe specifications can be changed quickly.

"It's customization without compromising the needle on the speed nor on the changing of the line," Steyaert said. "If you had to make a new line [with traditional manufacturing] you'd have to stop the production line and reproduce."

Adidas has lofty goals for its Speedfactories

The apparel giant wants to create a total of one million shoes a year from both of its two Speedfactories — the Atlanta location as well as the first in Germany — by 2020.

That number is significant, but it's small compared to the total number of shoes Adidas makes each year — 403 million pairs of shoes in 2017, or more than a million a day on average.

The Speedfactories are meant to be "complementary to our main source of supply," Steyaert said. "[They] will never substitute our main source of supply."

As of now, the factory currently has about 150 employees. That relatively low number means it is economically feasible to have a factory in a country without an employee base full of highly skilled shoemakers.

Adidas wants to increase its speed in other ways

The second part of Adidas' speed strategy relates to infrastructure — something that's been under pressure in the US as Adidas' popularity has taken off, particularly distribution.

"When you grow more than 30% per year you push inevitably some infrastructure," Steyaert said.

Adidas has made investments in its East Coast and West Coast warehouses, including its own warehouse in  Spartanburg, South Carolina.

The brand is also planning to open a brand new warehouse in New Jersey dedicated to e-commerce and retail. Steyaert says this will be able to service New York City — one of Adidas' "key cities" — with quick delivery, possibly even same-day. 

Adidas isn't done with its Speedfactories, however. It plans to innovate within them to add more automated processes and see if it can get even more speed and flexibility out of them. There are currently no plans to create more factories, but Steyaert says he hopes to eventually duplicate its automated technology or even export the technology tested in the Speedfactories to its locations in Asia.

SEE ALSO: Adidas is launching a new 'dad shoe' for the summer

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Facebook tried to sell video as its next big thing — but viewership is already declining (FB)

Wed, 04/25/2018 - 8:59pm

  • Facebook users are watching fewer videos on the service, company officials reported Wednesday.
  • The decline in viewing follows changes the company made to how it prioritizes certain kinds of content in its News Feed.
  • News Feed video was previously a big emphasis for the company, but now it's switching gears to promote its Watch service.

It wasn't all that long ago that Facebook saw video as its next big thing — but those days may already be over.

As a result of the high-profile and widely-discussed changes the company has made to its service to prioritize certain kinds of content over others, users are watching less video on it, company representatives said Wednesday.

"We've […] observed some continued declines as we've done this, and in the passive consumption of video specifically," CEO Mark Zuckerberg said in a conference call with analysts following the company's first-quarter earnings report.

Zuckerberg and other Facebook officials declined to offer any specifics about how much video users are watching these days, or how that's changed, on the call. They also declined to discuss overall usage of the site.

But their comments indicate the decline in video watching comes on top of the overall usage decline Zuckerberg announced in January. He said then that changes the company had made to its service had resulted in users reducing the time they spent on it by about 50 million hours a day.

Since late last year, Facebook has been overhauling the algorithms underlying its News Feed to promote interactions with friends over posts from news publishers and other content producers and organizations. Publishers, in particular, have complained that they've seen a sharp dropping off in the amount of traffic they're seeing from Facebook following the changes.

But it's not just news articles that are taking a hit. So too are videos.

Facebook previously encouraged publishers to post videos

For the last several years, Facebook was encouraging individuals and content producers to post videos to its site, promising to promote them in the News Feed. Seeing an opportunity, several big-name publishing firms, including BuzzFeed and Mic, bet big on producing videos for Facebook, particularly live or short-form ones they thought would play well with its users. Now, some of those bets are looking suspect.

The decline in News Feed video watching is in line with what the company expected after it made its algorithm changes, Zuckerberg said.

"We think this is going in the direction of building a stronger community and a stronger business over the long term," he said.

We think this is going in the direction of building a stronger community and a stronger business over the long term," he said.

Facebook hasn't abandoned video. But it's now focusing its efforts on its Watch service, which is kept separate from the News Feed. The company is aiming to offer a "very different" experience in Watch compared to what users could see in the News Feed or what they might find on YouTube, Zuckerberg said Wednesday.

Unlike News Feed videos, those on Watch are curated and are typically episodic. Additionally, Facebook is working on ways to tie them into its social network, such as by encouraging groups of users to watch them together.

Facebook likes how Watch is developing thus far, Zuckerberg said. But he declined to say how many users are tuning into into, saying only that "it's still pretty early overall" for the service.

The changes Facebook made to its algorithms came in the wake of growing criticism about its service and its influence on society. The company has taken a beating over charges that its service is actually harmful to its users' well being and that it has been repeatedly hijacked by propaganda artists to influence elections and divide societies.

SEE ALSO: AI is great at recognizing nipples, Mark Zuckerberg says

SEE ALSO: Facebook's rep has taken a hit from the Cambridge Analytica scandal — but its ad business hasn't

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Mark Zuckerberg revealed one of his 'great regrets' — and the timing doesn't seem like an accident (FB)

Wed, 04/25/2018 - 8:16pm

  • Facebook CEO Mark Zuckerberg said he regrets not having a bigger impact on "the way that mobile platforms developed" in the last decade.
  • Because Facebook was a small company when iOS and Android were first emerging, he says "that just wasn’t a thing we were working on."
  • The perspective comes as Facebook is trying to get past a backlash about certain ways its product has harmed society.

Mark Zuckerberg, at 33 years old, is worth billions of dollars and has built a product that's used by 2 out of every 7 people on the planet. 

But that doesn't mean the man has no regrets.

During Facebook's Q1 conference call on Wednesday, Zuckerberg revealed one of his "great regrets" about his stewardship of the company. Facebook, in Zuckerberg's view, did not play enough of a role developing and influencing the mobile technology that's become society's primary means of computing. 

"Frankly, we haven't been a hardware company or an operating system company," Zuckerberg said during the call. 

Smartphones and other mobile gadgets are designed around apps, instead of people, the Facebook CEO explained. Were Facebook not so busy building its own service at the dawn of the smartphone age a decade ago, it would have been able to show everyone a better way.

"One of my great regrets in how we’ve run the company so far is I feel like we didn’t get to shape the way that mobile platforms developed as much as would have been good," Zuckerberg said. 

Zuckerberg made the comments in response to a question about Facebook's Oculus virtual reality headset — a product that Zuckerberg believes could lay the foundation for a new and improved "people first" computing platform. 

It's a convenient time for Facebook to make this point

Facebook's struggles with mobile have impacted the company before, most notably when Facebook was slow to move its advertising business to mobile after its 2012 IPO and its stock tanked.

But it's tough not to view his comments in the context of the current backlash facing the company, including Facebook's role in spreading misinformation and the misuse of its users' private data. Zuckerberg spent two days on Capitol Hill earlier this month getting grilled by lawmakers about Facebook's responsibility. 

To hear Zuckerberg tell it now, Facebook is merely a bystander struggling to get buy in a mobile world created by other companies. And as Facebook looks for ways to recast its role in the current narrative and to shield itself from the blame, Zuckerberg's "regret" could have some nice benefits.

Here are Zuckerberg's full comments from the call: 

"One of my great regrets in how we’ve run the company so far is I feel like we didn’t get to shape the way that mobile platforms developed as much as would have been good, because they were developed contemporaneously with Facebook early on. iOS and Android came out around 2007, we were a really small company at that point, so that just wasn’t a thing we were working on.

The way that I think about this is that people should really be at the center of how we design technology. It shouldn’t be designed around apps, it should be designed around our relationships, because that’s what matters to people, and that’s not the world we’re on, on mobile."

SEE ALSO: Facebook shredded Wall Street's Cambridge Analytica worries with a giant Q1 and its stock is soaring

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BEYOND BITCOIN: How financial institutions are applying distributed ledger technologies to new use cases for ground-up business transformation

Wed, 04/25/2018 - 7:32pm

This is a preview of a research report from Business Insider Intelligence, Business Insider's premium research service. To learn more about Business Insider Intelligence, click here.

Of the many technologies reshaping the world economy, distributed ledger technologies (DLTs) are among the most hyped. DLTs are most often associated with cryptocurrencies like Bitcoin, but such coverage sidelines the broader use cases of DLTs, even though they stand to make a far bigger impact on the broader the financial services (FS) industry.

DLT's value lies in its ability to centralize record-keeping, while cutting out the need for authorization by an overseeing party, instead allowing a record to be confirmed by multiple parties with access to the database. This means DLTs have the potential to streamline financial institutions' (FIs) operations, boost data security, improve customer relationships, and drastically cut costs. But many FIs have struggled to implement DLTs and reap the rewards, because of organizational obstacles, but also because of issues rooted in the technology itself. There are a few players working to make the technology more usable for FIs, and progress is now being made.

In a new report, Business Insider Intelligence takes a look at what DLTs are and why they hold so much promise for FS, the sectors in which DLTs are gaining the most traction and why, and the efforts underway to remove the obstacles preventing wider DLT adoption in finance. It also examines the few FIs close to unleashing their DLT projects, and how DLTs might transform the nature of FS if adoption truly takes off. 

Here are some of the key takeaways from the report:

  • DLTs are proving attractive to FIs because of their ability to act as a single source of truth, distribute information securely, cut out middlemen, improve transaction times, and cut redundancy and costs.
  • DLTs like blockchain and smart contracts stand to save the FS industry up to $50 billion a year through improved operational efficiencies, reduced human error, and better regulatory compliance. 
  • The technology is being explored actively across FS, with trade finance, insurance, and capital markets proving especially active. Overall adoption is still low because of organizational and technical hurdles, but these are now being eliminated, promising to boost implementation.
  • A few FIs have pulled ahead of the curve and are very close to taking their DLT projects live, if they haven't already. These players can serve as useful case studies for other institutions in getting their DLT solutions live.

In full, the report:

  • Looks at what DLTs are, and why the FS industry is working hard to make use of them. 
  • Gives an overview of the financial segments which are seeing the most DLT activity, and what they stand to gain.
  • Outlines efforts being made to make DLT more approachable and usable for the FS industry.
  • Examines use cases in which FIs have managed to take their pilots live, and what they can teach their peers. 
Subscribe to an All-Access pass to Business Insider Intelligence and gain immediate access to: This report and more than 250 other expertly researched reports Access to all future reports and daily newsletters Forecasts of new and emerging technologies in your industry And more! Learn More

Purchase & download the full report from our research store

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Amazon is trading at more than 200 times its earnings — here's why that's not as crazy as it sounds (AMZN)

Wed, 04/25/2018 - 7:17pm

  • Ahead of Amazon's earnings report Thursday, the company is trading at a steep premium to its earnings.
  • Even with that premium, bulls have lots of reasons to like the company and its stock.
  • But there are some clouds overhanging the company, including criticism from President Trump and a swelling amount of debt and long-term obligations.

At more than 20 years old and with a valuation of more than $700 billion, Amazon's no startup. But if you're invested in the company, you're banking that it will continue to grow like one.

That bet has paid off quite handsomely of late. Amazon's shares have well more than doubled over the last two years and are up around 25% in the year to date.

But with the company's stock now trading at a precariously high rate of more than 200 times its earnings over the last year, the key question for investors is whether Amazon will be able to keep meeting their expectations.

For now, Wall Street thinks it can. When Amazon reports earnings on Thursday, analysts are expecting it will announce a 40% jump in sales — boosted in part by its Whole Foods acquisition — and are looking the company to forecast a similar increase for the second quarter.

Bulls have plenty they can point to support their optimism. Amazon dominates online commerce in the US and continues to grow its share of the market both here and abroad. Its purchase of Whole Foods last year gives it a new opportunity to grow its retail sales, luring Whole Foods customers to its web store and its online customers to the grocery chain.

Meanwhile, the company recently announced that it now has 100 million subscribers to its Prime service. Because Prime customers tend to spend more with the company than the average consumer, the ever growing number of them could lead to a boom in Amazon's retail sales.

Amazon's best bets may be outside traditional retail sales

But many analysts think that the company's best prospects are outside its traditional business of selling products directly to customers. There's a lot of optimism, for instance, about Amazon's prospects in a related area — selling and delivering goods for other merchants.

Over the last several years, Amazon has been building out its network of fulfillment centers around the world. Last year, it spent $10.1 billion — up from $6.7 billion the year before — in part to expand that network.

That outlay is starting to pay off. Last year, the company brought in $31.9 billion from commissions and shipping and delivery fees for sales by third-party vendors. That was up from around $23 billion in 2016.

Another area many analysts are hopeful about is advertising. As Amazon has become the first stop for folks shopping online, it's started to build up an advertising business, allowing companies to advertise their wares to its shoppers.

Many analysts have high hopes for that business, seeing it as a source of low-cost revenue growth, which could lead to substantial profits. It's already off to a strong start. Last year, the company brought in $4.7 billion in "other" revenue, which includes its advertising sales. That was up from about $3 billion the previous year.

AWS remains its crown jewel

But the biggest source of optimism for analysts and investors has generally been Amazon Web Services, the company's cloud-computing service. The company pioneered the market and now firmly leads it. With large and small businesses alike increasingly embracing the cloud and moving away from operating their own data centers, that's a good position to be in.

AWS has already been growing rapidly. Last year, the segment posted sales of $17.5 billion and reached an annualized run rate of $20 billion. That was up from $12.2 billion in sales in 2016.

Even though the cloud-computing effort still represents a small portion of Amazon's overall revenue, it already provides the lion's share of its profits. Last year, AWS brought in $4.3 billion in operating income, which more than made up for the $225 million operating loss posted by Amazon's combined North American and international retail operations.

Analysts are betting that AWS will continue to post such strong results.

But for any company trading at such a steep premium, falling even a little shy of analyst and investor expectations could be painful. And there are at least some reasons to be concerned about Amazon.

But Trump and debt may weigh on the company

Of late, the company and founder Jeff Bezos have found themselves in the sights of President Donald Trump, who has complained that Amazon unfairly competes with local retailers and pays less than it should to the US Postal Service for delivery costs. Those complaints could eventually weigh on Amazon's revenue and profits, particularly if they result in more uniform collection of online sales taxes — which could hit the company's third-party sellers — and higher postage rates.

But there are other concerns beyond those coming from Trump. As the company has built out its fulfilment network and added new titles to its library of streaming videos available to its Prime members, its debt has started to swell and long-term obligations have started to swell. Last year, its long-term debt more than tripled to $24.7 billion, while its long-term obligations — which are largely comprised of lease agreements — jumped to $21 billion from $12.6 billion.

More broadly, Amazon has some $40 billion in bills coming due between now and the end of 2020 just from debt, leases, video content production agreements, and similar long-term commitments.

Much of the bull case around the company has been built around not its reported profits, which are traditional fairly modest, but around its ability to produce free cash flow, which is the difference between the money generated from its operations and its investments in property and equipment and other capital expenditures.

Last year, Amazon posted free cash flow of $8.4 billion. That was more than double its reported profit of $3 billion, but off from the $10.5 billion it posted the year before.

Free cash flow is supposed to be a way of getting at how much cash a company is really generating on an ongoing basis. But in Amazon's case, that may not be the case. If you start taking into account the money it's spending repaying its leasing costs, the company's cash flow starts to look a lot worse. By at least some measures, if you include such costs, Amazon actually saw a net outflow of cash last year, to the tune of $1.5 billion.

For now, though, Amazon's optimists are winning the day. As long as the company continue to post impressive growth, that likely won't change.

SEE ALSO: A soft spot in Amazon's core business will surprise investors in Q1, but Wall Street will have a bigger reason to celebrate

SEE ALSO: Trump's anti-Amazon crusade could actually help the company — even if it leads to sales tax changes and higher shipping rates

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Starting salaries in 18 European nations, ranked from lowest to highest

Wed, 04/25/2018 - 7:01pm

For many of us, securing a job after university is a huge task, requiring countless applications, seemingly dozens of interviews, and many disheartening rejections.

But once you've got your foot on that ladder, a first professional job can be a lucrative business, with salaries in some European nations exceeding $90,000 for entry level positions, according to data from consultancy Willis Towers Watson released on Thursday.

Across Europe, salaries vary wildly, with the gap between the first and last universities on this list more than $55,000 (£40,000), but the best paid professionals are generally in Northern European countries, the continent's most prosperous nations.

Check out where in Europe young professionals pick up the biggest paychecks below.

SEE ALSO: How much you can earn in your first year at Goldman Sachs, JPMorgan and other big investment banks

18. Portugal — $22,630 (£16,229)

17. Greece — $25,132 (£18,023)

16. Slovenia — $29,414 (£21,094)

See the rest of the story at Business Insider

AI is great at recognizing nipples, Mark Zuckerberg says (FB)

Wed, 04/25/2018 - 6:47pm

  • Facebook is increasingly relying on artificial intelligence to identify offending items on its site.
  • But AI is better at recognizing some things than others, CEO Mark Zuckerberg said on Wednesday.
  • One example: it's good at finding nipples, he said. But not hate speech.

There's a growing fear of how artificial intelligence is going to affect society, but at least right now, AI is a lot better at some things than others.

One of the things it's pretty good at? Recognizing nipples.

That was the word from Facebook CEO Mark Zuckerberg on Wednesday. The social networking giant is increasingly relying on AI to police its service and identify content that violates its policies and guidelines.

But it's having varying degrees of success. Terrorism-related posts from the likes of ISIS and Al Qaeda are easy to  police with AI, he said. So too is nudity. But hate speech? Not so much.

"It's easier to build an AI system to detect a nipple than what is hate speech," Zuckerberg said on a conference call with analysts following the company's first-quarter earnings report.

Using AI, Facebook is able to identify and remove about 99% of terrorism-related content without a user having to notify the company first, he said. By contrast, it will likely take years for AI to reliably recognize hate speech he said. That difference is "frustrating," he acknowledged.

Zuckerberg's comments echo his testimony before Congress earlier this month during hearings examining the Cambridge Analytica scandal. He said then it could take five to 10 years for AI technology to mature enough that it would be able to reliably distinguish hateful slurs from legitimate political expression.

Meanwhile, his comparison to identifying nipples is an apt one. The company was embroiled in a controversy several years ago about people posting photos to the site of mothers breastfeeding their infants. After initially appearing to bar such photos, the company modified its terms of service to make clear that it would allow them — as long as no nipples are visible.

SEE ALSO: Mark Zuckerberg says AI won't be able to reliably detect hate speech for 'five to 10' years

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Och-Ziff's co-CIO Jimmy Levin has been selling a bunch of his stock in the hedge fund — and Wall Street investors are wondering why (OZM)

Wed, 04/25/2018 - 6:41pm

  • Och-Ziff's co-CIO Jimmy Levin has sold a chunk of his Class A stock in the firm for the first time ever, all at a rapid pace.
  • Levin owns other types of stock, like Class B shares, which carry voting power in the company but no monetary value, as well as restricted stock which won't be available for sale until the end of 2018.
  • Och-Ziff shares are down about 80% in value in five years.
  • Och-Ziff says the sales are part of a pre-arranged plan, but the quick rate of selling raised questions among some investors on Wall Street.

Jimmy Levin, the 35-year-old investor once considered next in line to become CEO of Och-Ziff Capital Management, has been selling shares in the publicly-traded hedge fund at such a rapid clip that some investors are wondering why. 

Levin, the fund's co-chief investment officer and head of global credit, has sold all of his holdings in Och-Ziff's Class A shares, filings with the Securities and Exchange Commission show. The stake sale, of 2.5 million shares, happened in 13 transactions that were disclosed over about two weeks. The last disclosed sale was on Tuesday.

Levin owns other types of stock, like Class B shares, which carry voting power in the company but no monetary value, as well as restricted stock which won't be available for sale until the end of 2018.

The sale represents a small fraction of what Levin owns. A person familiar with the matter said that, following his sale, Levin now owns the equivalent of about 35 million shares, a figure which includes options.

Och-Ziff, a $32 billion fund, says the sales are part of a publicly "pre-established plan" to sell shares, but the pace of the stake sale has investors asking what's going on, according to an analyst who covers the company. Another person said others in the community, including at Och-Ziff, have taken notice.

Levin's selling has drawn attention because it's the first time that he has had any disclosed sales. He joined Och-Ziff in 2006.

The sales come at a low point for the stock price – Och-Ziff shares are down nearly 80% in value over the past five years – and follow Och-Ziff's abrupt announcement that Levin is no longer on track to become the firm's CEO

Levin sold 13 batches of stock in two weeks, worth about $5.8 million

On April 6, Levin began the first of what amounted to sales of about 2.5 million of his Class A shares, regulatory filings show. Levin has made a total of 13 reported sales starting April 6, over a period of about two weeks.

Och-Ziff said in filings the sales are part of a plan that's in compliance with a regulation called Rule 10b5-1(c). That rule allows company insiders to avoid insider trading by setting up a pre-determined trading plan.

Levin owned about 2.5 million Class A shares at the start of April, the filings show. The sales occurred at different times with shares being sold at different prices, but at an approximate price of $2.30 each, he would've have made roughly $5.8 million in the process.

Earlier this year, Levin got a new contract after reportedly clashing with founder Dan Och about Och's succession plan.

Levin's new contract gave him 13.4 million restricted stock units, a February filing shows. As part of the deal, he also got a base pay of $4 million, with a minimum bonus of $7.5 million a year.

If you have more information, please contact reporter Rachael Levy. Her contact information is here.

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Stocks are defying conventional wisdom — and their strange behavior offers a huge hint about what's really driving the market

Wed, 04/25/2018 - 6:05pm

  • The stock market is doing something unexpected, bucking forecasts that investment experts have been making for months.
  • The dynamic goes a long way toward showing what's driving equities.

The stock market isn't obeying the playbook laid out by investment experts.

For months, so-called yield proxy stocks have been viewed as the most at-risk in a rising-interest-rate environment. After all, a huge part of their appeal stems from the investor payouts they offer, usually in the form of dividends.

Instead, the opposite has happened. As Treasury yields have climbed above the closely watched 3% threshold, fueling speculation of faster rate hikes, yield proxies — specifically utility and telecom stocks — have outperformed the market.

Not bad for a group once marked for death as soon as interest rates started rising.

As the chart below shows, over the past two days, they've been the only two sectors in the S&P 500 that have gained. And it's not particularly close.

So now the key question becomes: Why are yield proxy stocks behaving unexpectedly?

There are a couple of possibilities.

First and most likely, investors' nerves are rattled, so they're defensively rotating out of riskier industries like tech and into safer areas like utilities and telecom. This desire for safety would seem to be outweighing any ill effect of higher interest rates on yield proxies. Meanwhile, tech is holding up its end of the bargain, leading the market lower for a second straight day.

It's also possible that traders are using the negative sentiment creeping into markets as an excuse to pare positions. Though US stocks are mired in a rough patch, they're still just 9% from record levels reached in late January.

Whatever the reason, we can agree that the staid narrative of yield proxies coming under pressure as rates rise is flawed. Clearly, there are other forces afoot, and traders would be best advised to survey all possible options.

SEE ALSO: 'They're changing the whole way that commerce works' — BlackRock's $1.8 trillion bond chief explains how millennials are spearheading an economic revolution

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A Tesla Model X driver claims her car crashed into a gym after she hit the brakes — but similar incidents point to a different explanation (TSLA)

Wed, 04/25/2018 - 5:54pm

  • A Tesla Model X crashed into a gym in Florida on Sunday, according to ABC.
  • No one was injured during the incident.
  • The driver reportedly claimed the vehicle accelerated after she hit the brakes, though a Tesla representative said similar incidents in the past revealed that the driver accidentally pressed on the accelerator instead of the brake.

A Tesla Model X crashed into a gym in Florida on Sunday, according to ABC.

A security video obtained by ABC shows the vehicle entering an Anytime Fitness outside of Tampa Bay a few feet away from a man walking off a treadmill. No one was injured during the incident.

The driver reportedly claimed the vehicle accelerated after she hit the brakes, though a Tesla representative said similar incidents in the past revealed that the driver accidentally pressed on the accelerator instead of the brake.


"We take the safety of our customers very seriously and we’re glad our customer is safe," the representative in a statement. "We investigate the vehicle diagnostic logs in every accident in which a driver claims their car 'suddenly' and 'unexpectedly' accelerated, and in every case the vehicle's diagnostic logs confirm that the vehicle operated as designed. Accidents involving 'pedal misapplication,' in which a driver presses the accelerator pedal by mistake, occur in all types of vehicles, not just Teslas. The accelerator pedals in Tesla vehicles have two redundant sensors that clearly show us when the pedal is physically pressed down, such as by the driver’s foot."

According to ABC, the Florida Highway Patrol is investigating whether Tesla's semi-autonomous Autopilot software was activated during the incident, though the software is most often used on highways, where it can match a vehicle's speed to surrounding traffic conditions and keep the vehicle within its lane.

In 2016, a Model X crashed into a gym in Lighthouse, Florida. The driver claimed the vehicle accelerated on its own, though Tesla determined the accelerator pedal was pressed after reviewing the vehicle's data logs. Tesla came to the same conclusion after a similar incident two months earlier in a parking lot in Irvine, California.

SEE ALSO: Kanye West praises Elon Musk, says his Tesla is the 'funnest' car he's ever driven

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A Silicon Valley biotech hub that offers startups $250,000 in funding explains the ‘secret sauce’ to success

Wed, 04/25/2018 - 5:22pm

  • Silicon Valley's startup scene is highly competitive, with more than 33,000 existing startups and new ones sprouting up daily.
  • Arvind Gupta is the founder of a fast-growing biotech incubator that funded meat alternative startup Memphis Meats, which is now backed by Bill Gates and Richard Branson.
  • Gupta's accelerator IndieBio gives startups $250,000 in seed funding as part of a 4-month incubation program. He looks for three main traits in a startup before he commits.

Arvind Gupta, the founder of a fast-growing Silicon Valley biotech incubator called IndieBio, couldn't care less about a startup's lofty vision for the future.

IndieBio funded Memphis Meats, a lab-grown meat startup founded by Uma Valeti that now has backing from Bill Gates, Richard Branson, Twitch cofounder Kyle Vogt, and Elon Musk's brother, Kimbal Musk. Two food giants — Tyson Foods and Cargill — are other notable backers. The startup burst onto the Silicon Valley startup scene — which now numbers more than 33,000 — in 2015.

The most important piece of advice Gupta gave Valeti involved dissuading him from focusing too much on his dreamy long-term vision of reducing waste and saving the planet from climate change. Instead, Gupta frequently encouraged him to talk about the goals his company had already accomplished, such as making real meat without a single farm animal.

It is an approach that Gupta encourages with all of the startups in his ecosystem, which is now in its third year and sixth class of companies.

"Your pitches won't sell your company," Gupta told Business Insider during a recent meeting at IndieBio's headquarters in San Francisco's Civic Center district. "Don't talk about what you're going to do. Talk about what you've done."

The startups that Gupta has helped fund range from drug companies to startups focused on lab-grown meat. Most recently, IndieBio welcomed a spate of early-stage companies focused on neuroscience, including NURO, a Canadian startup that's creating a brain machine interface for locked-in patients, and Neurocarrus, which is focusing on a non-opioid drug for severe pain.

Here are the highlights that Gupta looks for in a startup. Together, he said these items form the basis of what he calls IndieBio's "secret sauce" for startup success.

Home in on a niche issue

Startups often have ambitious goals — from linking our brains to our computers to regenerating limbs — but focusing too much on long-term aspirations can cripple a team's progress, Gupta said.

"Saying you're just going to show up on Mars is a great dream, but you need to solve a lot of smaller issues first," Gupta said.

Instead of paying too much attention to a far-off target, Gupta advises finding a discreet problem and homing in on a creative, valuable solution to that. With Memphis Meats, for example, the ultimate goal was reduced waste. But the smaller problem was meat that doesn't require barn houses full of animals.

Give the hardest workers the most equity

One of the most powerful lessons Gupta learned early on with IndieBio was that if the people who aren't putting in the most work aren't also getting the most equity, it can squelch their chances of success.

One company he funded several years ago, for example, got a complex term sheet from an investor. Rather than agreeing on a solution, the team argued over the details until they eventually split up. He said the main problem was that the people who'd worked the hardest at making their product a reality weren't valued the most within the company. As a result, they had no real voice and couldn't lead the company toward the best solution.

Create something with real value

Besides ensuring your company is ideologically focused and financially balanced, Gupta said a startup needs to create a product that generates value for consumers.

With that in mind, he encourages companies to talk to potential investors about what they've already accomplished and showcase the products they've already produced, rather than discussing a dreamy vision for the future of the planet.

"Once you start talking about what you've done, you get insight," Gupta said. "The next questions you need to ask yourself are, 'How does that insight translate into a product? And how does that product create real value for people?'"

Memphis Meats, which created the world's first lab-grown chicken meat last year, has been able to tick off all of these boxes so far — a feat that recently landed them on the cover of Inc. magazine.

"We're giving scientists a chance to be entrepreneurs when literally no one else would have given them a chance," Gupta said. "Seeing Uma on the cover of Inc. — that's my personal gratification."

SEE ALSO: A controversial technology could save us from starvation — if we let it

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IDENTITY VERIFICATION IN BANKING: How banks are using new authentication methods to boost conversions and keep their customers loyal

Wed, 04/25/2018 - 5:02pm

This is a preview of a research report from Business Insider Intelligence, Business Insider's premium research service. To learn more about Business Insider Intelligence, click here.

The way incumbent banks onboard and verify the identities of their customers online is inconvenient and insecure, resulting in lowered customer satisfaction and loyalty, and security breaches leading to compensation payouts and legal costs.

It’s a lose-lose situation, as consumers become disgruntled and banks lose business. The problem stems from the very strict verification standards and high noncompliance fines that banks are subject to, which have led them to prioritize stringency over user experience in verification. At the same time, this approach doesn't gain banks much, since the verification methods they use to remain compliant can actually end up compromising customers' personal data.

But banks can't afford to prioritize stringent verification at the cost of user experience anymore. Onboarding and verification standards are increasingly being set by more tech-savvy players within and outside their industry, like fintechs and e-retailers. If banks want to keep customers loyal, they have to start innovating in this area. The trick is to streamline verification for clients without compromising accuracy. If banks manage to do this, the result will be happier and more loyal customers; higher client retention and revenue; and less spending on redundant checks, compensation for breaches, and regulatory fines.

The long-term opportunity such innovation presents is even bigger. Banks are already experts in vouching for people’s identities, and because they’re held to such tight verification standards, their testimonies are universally trusted. So, if banks figure out how to successfully digitize customer identification, this could help them not only boost revenue and cut costs, but secure a place for themselves in an emerging platform economy, where online identities will be key to carrying out transactions. 

Here are some of the key takeaways from the report:

  • The strict verification standards that banks are held to have led them to create onboarding and login processes that are painful for clients. Plus, the verification methods they use to remain compliant can actually end up putting customers' personal data at risk. This leaves banks with dented customer satisfaction, as well as security breaches and legal costs.
  • Several factors are now pushing banks to attempt to remedy the situation, including a tougher regulatory environment and increasing competition from agile startups and tech giants like Google, Amazon, and Facebook, where speedy onboarding and intuitive service is a given.
  • The trick is to streamline verification for clients without compromising accuracy, something several emerging technologies promise to deliver, including biometrics, optical character recognition (OCR) technology, cryptography, secure video links, and blockchain and distributed ledger technology (DLT). 
  • The long-term opportunity such innovation presents is even bigger. Banks are already experts in vouching for people’s identities, so if they were to figure out how to successfully digitize customer identification, this could help them secure a valued place, and relevance, in a modernizing economy.

In full, the report:

  • Looks at why identity verification is so integral to banking, and why it's becoming a problem for banks.
  • Outlines the biggest drivers pushing banks to revamp their verification methods.
  • Gives an overview of the technologies, both new and established but repurposed, that are enabling banks to bring their verification methods into the digital age.
  • Discusses what next steps have to happen to bring about meaningful change in the identity verification space, and how banks can capitalize on their existing strengths to make such shifts happen.
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Chipotle surges after beating on earnings and announcing it's buying back more stock (CMG)

Wed, 04/25/2018 - 4:40pm

Chipotle Mexican Grill shares soared more than 10% in after-hours trading Tuesday after the company beat on earnings, showed an improvement in same store sales, and announced it was allocating more money to buy back stock. This was the first quarterly report under the leadership of CEO Brian Niccol, who came over from rival Taco Bell in March. 

The restaurant chain, best known for its burritos, reported a adjusted earnings of $2.13 a share, easily beating the $1.57 that analysts surveyed by Bloomberg were expecting.

The company also announced the Board approved investment up to $100 million to use for share buybacks. 

"We are in the process of forming a path to greater performance in sales, transactions, margins and new restaurants," Niccol said in a press release. "This path to performance will be grounded in a strategy of executing the fundamentals while introducing consumer-meaningful innovation across the business." 

First-quarter revenue hit $1.1 billion, a 7.4% increase from a year ago, which was attributed to new store openings. The company opened 35 new restaurants and closed 2 restaurants during the quarter. 

For full year 2018, management forecasts 130-150 new restaurant openings and same store sales growth in the low- single digits. 

Chipotle shares have gained 27.3% this year. 

SEE ALSO: Snap is sinking after saying its looking into rolling back part of its redesign

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Ford beats on first-quarter earnings — but kills sedans in USA (F)

Wed, 04/25/2018 - 4:33pm


  • Ford beats analysts expectations for Q1 earnings.
  • Ford is in the midst of a corporate restructuring.
  • Ford announced it will not invest in new sedans in North America but will keep Mustang and a new crossover with the Focus nameplate.

Ford reported first-quarter earnings after the markets closed on Wednesday and beat analysts expectations, with a profit of $0.43 per share and revenue of $42 billion.

"We are committed to taking the appropriate actions to drive profitable growth and maximize the returns of our business over the long term," CEO Jim Hackett said in a statement.

"Where we can raise the returns of underperforming parts of our business by making them more fit, we will. If appropriate returns are not on the horizon, we will shift that capital to where we can play and win."

Winning for Ford means killing off its sedans.

"Given declining consumer demand and product profitability, the company will not invest in next generations of traditional Ford sedans for North America," the carmaker said.

"Over the next few years, the Ford car portfolio in North America will transition to two vehicles – the best-selling Mustang and the all-new Focus Active crossover coming out next year."

Consumers have made a decisive shift away from four-doors to SUVs in recently years. Fiat Chrysler Automobiles moved away from sedan over a year ago, while General Motors has remained committed but has dialed back production. 

Ford said that 90% of its US lineup would be pickups, SUVs, and commercial vehicles.

Ford shares finished the trading day on Wednesday up just over 1%, to $11. Year-to-date, Ford stock has declined over 12%.

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NOW WATCH: Ford replacing its CEO points to the short-termism on Wall Street

Facebook is surging after crushing on earnings and adding more users than expected (FB)

Wed, 04/25/2018 - 4:31pm

Facebook shares are up 5% in after-market trading Wednesday, to above $167 a share, after the company reported better-than-expected first-quarter earnings.  

Facebook reported earnings-per-share of $1.69, up 63% year-over-year and above Wall Street's expected $1.35. Revenue was $11.97 billion, up 49% year-over-year, and also beating estimates of $11.4 billion. 

Daily active users came in at 1.45 billion, in line with analyst estimates of 1.45 billion. But monthly active users came in at 2.2 billion, beating estimates of 2.19 billion. 

Facebook is now down about 8% so far this year. 

SEE ALSO: Snap is sinking after saying its looking into rolling back part of its redesign (SNAP)

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AMD is surging after a stellar earnings report (AMD)

Wed, 04/25/2018 - 4:23pm

Shares of AMD (Advanced Micro Devices)  soared more than 7% in after-hours trading Wednesday after the chip maker's first-quarter results topped analyst expectations.

The company said it earned an adjusted $0.11 per share, outpacing the $0.09 that analysts surveyed by Bloomberg were expecting. Revenue was $1.65 billion, which was ahead of the $1.57 billion that Wall Street was anticipating.

"The first quarter was an outstanding start to 2018 with 40 percent year-over-year revenue growth,” said Lisa Su, AMD's president and CEO, in a press release. "PC, gaming and datacenter adoption of our new, high-performance products continues to accelerate. We are excited about our long-term roadmaps and focused on delivering sustained revenue growth and profitability."

The crypto craze that peaked in January provided a boost for GPU makers like AMD and its competitor NVDA. But as prices have fallen in 2018, so too has would-be miners interest in the chips that were traditionally only popular among PC gamers.

"Ultimately, we don’t believe Crypto GPU Rev is sustainable and see 3 potential issues: (1) Price volatility in Ethereum which makes mining less economical, (2) Bitmain’s Ethereum ASIC scheduled for release in July, and (3) An increased probability of Crypto moving from proof-of-work to proof-of-stake negating the need for mining/GPUs all together," Credit Suisse analyst John Pitzer warned clients ahead of the earnings report.

AMD did not directly mention cryptocurrencies in its quarterly filing — but will almost certainly be asked about their impact on its bottom line by analysts on the conference call later Wednesday evening. 

"AMD had a blowout revenue quarter, beating guidance and growing 40% year on year which would make it the third straight quarter of double digit YoY revenue growth," Patrick Moorhead, an analyst at Moor Insights & Strategy, said in an email. "The growth was led by sales of AMD's Ryzen client CPU and APU product line in desktops and notebooks. I expect AMD to show even more gains next quarter based on channel fill of second generation Ryzen desktop CPU, increased distribution of Ryzen mobile notebooks and the continued ramp of EPYC server deployments.” 

Shares of AMD are down 10% since the beginning of the year.

SEE ALSO: Young people are loving AMD ahead of earnings

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Genesis Trading looks to stay open 24/7 as it rides a wave sweeping up traders in one corner of the bitcoin market

Wed, 04/25/2018 - 4:18pm

  • Genesis Trading is hiring an overnight trader to help the firm meet demand out of Asia. 
  • The new hire might be a precursor to the firm setting up shop on the continent, CEO Michael Moro told Business Insider. 

Genesis Trading, a New York-based cryptocurrency trading firm, is hiring an overnight trader to meet demand from clients in Asia as it weighs whether or not to expand onto the continent. 

The company, which trades cryptocurrencies such as bitcoin over-the-counter, is looking to hire someone to sit on the desk from 7 p.m. to 7 a.m., according to a job advertisement

Genesis Trading was one of the first trading firms to jump on the bitcoin bandwagon. The company spun-off from SecondMarket's cryptocurrency trading desk in 2015. It recently has launched a new lending business which has attracted more than 60 clients, including market making firms and cryptocurrency hedge funds.

Chief executive officer Michael Moro told Business Insider in an interview that the new overnight trader will address new demand out of Asia. 

"We've always traded in the off hours, but it was always by appointment," Moro said. "We'd have someone awake to deal with a certain client and then go back to bed."

Moro said the addition of the overnight trader could be a precursor to the firm expanding into Asia. 

"I'm still trying to figure out is whether I need an entire trading operation in London or Tokyo, or just a salesforce to do business development, with a 24/7 hour trader in New York," he said. 

Moro said the firm is leaning towards option B, for now. 

Asia, specifically Japan, has become a big market for cryptocurrency trading. 40% of bitcoin trading from October to November was conducted in yen, according to a Nikkei report cited in a Deutsche Bank note. The country was among the first to designate bitcoin as a legal tender and it has one of the most well-established and supportive regulatory environments for cryptocurrencies.

Circle Trade, another cryptocurrency trader, is also enjoying a boom in over-the-counter trading markets. It recently expanded its operations in Asia, Bloomberg reported.

DRW's Cumberland has also set up a cryptocurrency desk in Asia

Cryptocurrency trading in OTC markets is rising, while volumes across retail exchanges have tanked as interest in bitcoin markets has fizzled in recent months. Per data from CoinMarketCap, 24-hour trading volumes are down to about $25 billion a day from all-time highs near $70 billion at the beginning of the year.

SEE ALSO: A Chicago trading firm is setting up shop in Singapore to dominate the bitcoin market in Asia

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