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First Republic Bank’s stock fell by ~50% after the company reported $100B in net outflows, Biden will veto the Republicans’ debt bill if passed by Congress, US new-home sales hit a one-year high in March, Netflix is investing billions in South Korean content, and Binance.US terminated its deal to buy Voyager Digital.

Let’s dive in.

Before The Bell

Markets

• All three major US indexes shed over 1% yesterday as signs of a struggling First Republic Bank added to recession fears presented by mediocre earnings

  • The S&P and Dow posted their largest one-day percent drops in a month

• Benchmark Treasury yields posted their steepest drop since March

• Argentina's peso tumbled to a record low

Earnings

• UBS widely missed Q1 net profit estimates after increasing provisions for 2008 MBS-related litigation while also recording a drop in revenue and increase in operating expenses; the bank nonetheless saw $28B in new wealth management inflows in sign of confidence over its Credit Suisse takeover (CNBC)

• Alphabet beat Q1 EPS and revenue estimates on a first ever profit for its cloud segment and resilient ad sales despite slowing demand; the firm is relying on cost cuts to make up for a weak ad market (CNBC)

• Microsoft delivered a Q3 beat and raise on growth in its cloud computing and Office productivity software businesses and optimism over AI-related prospects; their stock surged 9% AH (CNBC)

• GM posted a Q1 beat and raise on positively quick impacts from its cost-cutting efforts and continued demand for high-end models; their stock nonetheless fell 4% (CNBC)

• Visa beat Q2 EPS and revenue estimates on a 24% rise in cross-border payments volume driven by a resilient post-pandemic travel rebound and growth in other metrics despite recession worries (BBG)

• Spotify missed Q1 revenue estimates and posted a wider-than-expected loss on a soft ad market but recorded 500M+ monthly active users and a 15% rise in premium subscribers, sending shares up 5% (RT)

• UPS missed on Q1 top and bottom lines on deceleration in US retail sales and ongoing demand weakness in Asia while lowering FY revenue forecasts in light of 'current macro conditions'; their stock fell 10% (CNBC)

• Verizon missed Q1 revenue and FCF estimates on wireless subscriber losses by inflation-hit Americans delaying device upgrades and stiff competition from AT&T and T-Mobile in its fast-growing 5G venture (RT)

• Raytheon beat on Q1 top and bottom lines on explosive Chinese demand for commercial aircraft spare parts amid on on-going global travel recovery (RT)

• McDonald's beat on Q1 top and bottom lines on growing traffic across all markets and income groups despite price hikes and recession threats; their stock is trading at all-time highs (RT)

• PepsiCo delivered a Q1 beat and raise on a combination of steady demand and successful price hikes undertaken to offset higher costs (RT)

• What we're watching this week:

  • Today: Meta, Boeing 

  • Thursday: Amazon, Intel, Snap, Eli Lilly 

  • Friday: Exxon, Chevron 

• Full calendar here

Headline Roundup

• US consumer confidence dropped to a nine-month low (RT)

• US new home sales soared 9.6% to a one-year high in March (RT)

• Biden will veto House Republicans' debt bill if passed by Congress (RT)

• BoE chief economist said Brits ‘need to accept’ they’re poorer (BBG)

• US equities saw their first inflow in a month last week driven by HFs (BBG)

• Biggest treasury buyers turn to swaps to flee wild price swings (BBG)

• UBS is set to post the biggest ever banking profit in Q2 quarter after it completes its Credit Suisse takeover (FT)

• Eastern Europe is borrowing at record rates amid rising war burden (BBG)

• ECB quizzes lenders over risk of SVB-style losses (FT)

• First Republic shares fell 50% to record low after reporting a ~$100B deposit drop (CNBC)

• Fitch sees First Republic's strategic options as 'very challenging' (RT)

• Short interest in First Republic Bank rose to $945.5M in the past month (RT)

• Price hikes boosted consumer giants' bottom lines in Q1 (RT)

• US is policing firms' AI usage to prevent civil rights violations (RT)

• Major VCs link arms in new climate push (AX)

• Netflix is investing $2.5B in South Korean content (AX)

• 3M will cut another 6k jobs or 9% of workforce (BBG)

• Gap will cut over 500 jobs corporate jobs in second lay off round (WSJ)

• UK-based VC Anthemis cut 28% of jobs (TC)

• Americans aren't taking advantage of high savings rates (AX)

• A senior Citigroup exec departed after reports of meetings with Epstein (FT)

• San Francisco is swarming with driverless cars (WP)

• Bang Energy's founder deleted Instagram comments to avoid fines (BBG)

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Deal Flow

M&A / Investments

• First Republic Bank is exploring divesting up to $100B of long-dated mortgages and securities to reduce asset-liability mismatch (BBG)

• Crypto exchange Binance.US terminated its $1.3B deal to acquire bankrupt crypto broker Voyager Digital (BBG)

• PE firm BPEA EQT and its existing portfolio company Nord Anglia Education agreed to buy Florida-based sports education provider IMG Academy for $1.25B (BBG)

• Japanese insurer Tokio Marine is considering a sale of its life insurance business in Southeast Asia at a potential $1B valuation (BBG)

• FTX debtors agreed to sell its crypto derivatives platform LedgerX to an affiliate of exchange operator Miami International Holdings for $50M (RT)

• Bondholders in French fashion group SMCP are expecting first-round bids for their 37% stake in the company by mid-May (RT)

VC

• Vedanta Biosciences, a clinical-stage biotech startup developing new oral therapies based on bacterial consortia, raised $106.5M in funding led by AXA IM Alts and The AMR Action Fund (FN)

• Rocket engine startup Ursa Major raised a $100M Series D from BlackRock and Space Capital (TC)

• Cloud developer platform Replit raised a $97.4M round at a $1.16B valuation led by a16z (PRN)

• Virta, an EV charging platform, raised $93M in funding led by Jolt Capital (FN)

• South Korean pharmaceutical company Mezzion Pharma raised $40M in funding from BRV Capital Management (FN)

• Adcentrx Therapeutics, a biotech startup focused on antibody-drug conjugates, raised a $38M Series A+ led by Eight Roads Ventures (FN)

• Woodoo, a startup developing augmented wood and decarbonized materials, raised $31M in funding led by Lowercarbon Capital (FN)

• Robotics safety startup Veo raised a $29M Series B led by Safar Partners and Yamaha Motor Ventures (TC)

• Cyclic Materials, a metals recycling company focused on producing critical materials, raised a $27M Series A led by Energy Impact Partners and BMW i Ventures (BW)

• Climate-monitoring satellite startup Hydrosat raised a $20M Series A led by Statkraft Ventures (TC)

• PreAct Technologies, a startup building near-field software-definable flash LiDAR tech, raised a $20M Series B led by I Squared Capital (PRN)

• Rinsed, a car wash CRM company, raised a $20M Series B led by VMG Technology (FN)

• TaxCloud, a sales tax compliance platform for ecommerce businesses, raised $20M in growth equity funding led by Camber Partners (FN)

• Karate Combat, a DAO sports league, raised an $18M round led by BITKRAFT Ventures (FN)

• Bobsled, a startup building a cross-cloud data sharing platform, raised a $17M Series A led by Greycroft and Madrona Venture Group (TC)

• Israeli-based patient monitoring platform Neteera raised a $13M Series B led by Aescuvest (PRN)

• Ox, an AI-powered technology platform for frontline operations, raised a $12.6M Series A led by BBG Ventures and MaC Venture Capital (PRN)

• CyberQP, a Vancouver-based provider of privileged access management and helpdesk security automation, raised $12M in funding from Arthur Ventures (FN)

• Carbon accounting platform CarbonChain raised a $10M Series A led by Union Square Ventures and Voyager Ventures (PRN)

• Zaptic, a frontline operations platform for manufacturing companies, raised a $10M Series A led by Molten Ventures (FN)

• Universal Ledger, a startup enabling users to build their own crypto wallets, raised a $10M round led by Hard Yaka (FN)

• NetRise, a cloud-based SaaS platform that analyzes and continuously monitors the firmware of Extended Internet of Things devices, raised an $8M round led by Squadra Ventures (PRN)

• Seatfrog, a rail ticketing app, raised $7.45M in growth funding from Pembroke, Praetura, and Octopus Ventures (FN)

• Riscosity, a platform helping manage and mitigate data supply chain risk, raised a $7M round led by S3 Ventures (FN)

• Student debt repayment platform Summer raised a $6M Series A extension led by General Catalyst, QED, Flourish Ventures, and more (TC)

• Physical security tech startup Hakimo raised a $6M round led by Rocketship.vc (FN)

• Credora, a startup providing privacy-preserving tech that enables real-time credit analytics, raised a $6M round from S&P Global and Coinbase Ventures (FN)

• DFlow, a provider of a decentralized payment for order flow protocol, raised a $5.5M round led by Framework Ventures (FN)

• Grace, a Korean aggregator of international health and beauty brands, raised a $5M Series B led by SKS Capital (FN)

• Ledgebrook, a Boston-based insurtech startup, raised a $4.6M SAFE round led by Markd (PRN)

• Ophthalmology-focused medtech company Ciliatech raised a $3.8M hybrid Series A led by BNP Développement, Kreaxi and Bernard Chauvin (FN)

• Rydes, a Berlin-based employee mobility budget platform, raised a $3.6M seed round led by Assembly Ventures and Rethink Ventures (FN)

• Springbok Analytics, a startup using MRI data to create personalized muscle visualizations, raised a $3M seed round led by Transition Equity Partners (PRN)

• Albatroz Therapeutics, a biotechnology startup targeting tissue remodeling to stop cancer growth, raised a $3M round led by Outram Bio and SEEDS Capital (FN)

• Whale, a knowledge sharing and employee training platform, raised $2.8M in funding led by Volta Ventures and Peak (FN)

IPO / Direct Listings / Issuances / Block Trades

• Nickel Asia, the Philippines' biggest nickel ore producer, is eying an IPO for its renewable energy business within the next three years (RT)

SPAC

• UK-based Hambro Perks Acquisition Company, which initially raised ~$186.25M, will wind down after abrupt departure of CEO (FT)

Bankruptcy / Restructuring

• Some creditors of Digital Currency Group's bankrupt crypto lending unit Genesis walked away from a prior restructuring agreement (RT)

Fundraising

• Carlyle raised $950M for its Carlyle Asia Partners Growth II fund (PEI)

• Fiera Real Estate, the real estate arm of Canadian investment manager Fiera Capital, raised $124M for a debut European debt fund (PER)

• Seattle-based VC Capria raised a $100M fund to invest in tech startups in the Global South (GW)

Crypto Corner

• Coinbase trading volumes fall as regulatory uncertainty weighs (FT)

• South Korea charged Terra co-founder Daniel Shin with fraud (WSJ)

• Chamath believes ‘crypto is dead in America' (CNBC)

• US CFTC said crypto must end anonymity for illicit finance (RT)

• UK FCA wants to work with crypto sector to develop regulation (CD)

• A Gibraltar court froze crypto assets in hunt for missing $43M (FT)

Exec’s Picks

• Technology news continues to cross over into the mainstream, with banking collapses, AI breakthroughs, and nonstop volatility in the venture capital industry. The Information has been a great resource to stay up to speed on insider news that does not get covered by TechCrunch, The Verge, or Bloomberg. Highly recommend a subscription to anyone serious about tech or venture capital. You can check them out here.

• Byrne Hobart wrote a good piece on why so many of the world’s most successful companies become ad platforms.

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