Fintech Newsletter for 5/1/21

Below are news related to the fintech industry this week.

Big tech companies reported their quarterly earnings ( GOOGL, MSFT, AMZN, AAPL,FB)

Major tech companies reported their earnings this week. Most tech companies registered in this article except Facebook are well above their pre-pandemic Net Income growth rates. Amazon exhibited the fastest recovery during the lockdown and continues to show tremendous growth rates.

Alphabet (GOOGL) reported a Revenue of $55.31B with a 34% YoY growth and a Net Income of $17.93B with a 162% YoY growth.

Some takeaways from the earnings call,

  • Google Maps to add 100+ AI-powered improvements
  • Late last year, Google announced a new Google News Showcase program to build its relationship with publishers and invested $1Billion. This quarter, Google announced it is continuing to add more publishers across various geographies to the program.
  • YouTube gathers momentum, especially with the “omnichannel” marketing and value-added up-sell opportunities with other google offerings (such as GCP)
  • Three key drivers attribute to Google cloud momentum, (a) customer momentum related to “Data cloud.”

“Our strength in AI and ML is also helping financial services customers, like HSBC, Commerce Bank, SEB Group, and BBVA, improve efficiency of payments, reduce fraud and risk, and deliver faster payment solutions. This past quarter, we released new functionality for BigQuery, delivering significantly better performance for business intelligence queries” — Sundar Pichai,CEO of Alphabet .

(b) customers need for robust IT infrastructure. © Growth in “Hybrid work” places Google workspace in a competitive position.

In summary: Google continues to differentiate its products and services based on its expertise in AI and ML. In addition, the advertisement continues to be the primary revenue source for Google, and diversifying into cloud computing will mitigate its long-term revenue risks.

Microsoft(MSFT) reported a Revenue of $41.06B with a 20% YoY growth,and a Net Income of $15.46B with a 44% YoY growth.

Microsoft mentioned investments in Azure-Arc to facilitate the customer needs in multi-cloud and multi-edge deployments . Microsoft is optimistic on the “power platform” and low-code and no-code platforms geared towards domain experts to quickly build actionable and insightful workflows.

“Just like Office-revolutionized productivity gains for knowledge workers, Power Platform will do the same for domain experts” — Satya Nadella,CEO of Microsoft

Office 365 (300M + paid seats),,Windows 10 (1.3B monthly active devices) and Microsoft 365(50M+ subscribers) continue to do well.

Amazon (AMZN) reported a Revenue of $108.09B with a 40% YoY growth,and a Net Income of $8.11B with a 220% YoY growth.

Amazon advertising with 76% YoY revenue growth and Third-party seller services with 63% YoY revenue growth led Amazon to blockbuster quarter. Even though the Physical store revenue declined AWS ,Online retail and subscription revenues more than compensated for the decline.

Apple (AAPL) reported a Revenue of $88.91B with a 54% YoY growth ,and a Net Income of 23.63B with 110% YoY growth.

Apple had strong quarterly earnings with iphone,mac and ipad all generating very strong sales numbers.

Facebook (FB) reported a Revenue of $26.17B with a 48% YoY growth ,and a Net Income of $9.5B with 94% YoY growth.

In summary, Overall Strong Ad spend and demand for cloud computing coupled with urgency for digital transformation due to Covid pandemic is driving profits for the tech companies.

Google adds more features to Google Pay.

Last year, Google introduced a newer version of Google Pay, focusing on frictionless and safer ways to pay and manage finances. Google further announced more features this week.

  1. Save — Google has partnered with Safeway and target to accept digital coupons directly from the google pay app.
  2. Commute — Google pay supports buying and using mobile transit tickets in 80+ cities in the United States, and they plan to add support in the San Francisco bay area and Chicago areas. In addition, the google pay app in android lets users use their transit tickets purchased through google pay t without having to unlock their phones.
  3. Spending by category — Google pay will add categories for different transactions. It will be easier for end-users to look at their spending habits without manually adding categories for each of their purchases.

MasterCard and Visa Announce Quarterly results.

Credit Card Networks continue to struggle from the pandemic and don’t have stellar results from Covid recovery as seen by the tech companies.

Master Card(MA) reported a Revenue of $4.16B with a 4% YoY growth,and a Net Income of $1.83B with a 10% YoY growth.

MasterCard announced its partnership with cryptocurrency exchange Gemini to launch a crypto rewards credit card.

Visa(V) reported a Revenue of $5.61B with a 2% YoY decline,and a Net Income of $3.03B with a 2% YoY decline.

Visa announced a partnership with Airbnb called Visa direct,which allows the Airbnb hosts to transfer money from their Airbnb account to their visa enabled debit card.

Stripe acquires TaxJar

Stripe earlier this week announced that it plans to acquire TaxJar, a popular provider of a cloud-based suite of tax services. Taxjar can be used to calculate, report and file sales taxes automatically. TaxJar is a “tax tech” company that will be an excellent addition to fintech companies such as Stripe. So now merchants can use Stripe’s vertical integration to help in both tax reporting and payment processing.

Fintech New Venture and IPO

  • Gr4vy, San Mateo based cloud-native payments company,raised $11m in Series A funding.
  • Keeper Tax,San Francisco based tax filing software for gig workers,raised $13m in Series A funding.
  • Paxos,New York based cryptocurrency infrastructure and white-label services platform,raised $300m in Series D funding.
  • Splitwise,Rhode island based mobile app and web platform that builds software to help users split expenses, raised $20m in Series A funding.
  • Alchemy,San Francisco based blockchain developer platform,raised $80m in Series B funding.
  • Step,San Francisco based provider of financial services for teens and families ,raised $100m in Series C funding.
  • Signal,Detroid based platform for financial advisors ,raised $10m in Series A funding.
  • Current,New York based digital challenger bank,raised $220m in Series D funding.
  • Brex,San Francisco based corporate credit card provider tailored to start-ups ,raised $425m in Series D funding.
  • Securrency,Washington D.C based blockchain financial and regulator tech company,raised $30m in Series B funding.

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