Silicon Valley Tech News Roundup – October 30th

Musk completes $44 billion Twitter takeover – 10/28

Based on the filing with the Securities and Exchange Commission (SEC) on Thursday, Elon Musk completed the $44 billion Twitter takeover. According to the reports from the Washington Post, Musk fired Parag Agrawal (Twitter CEO), Ned Segal (Chief Financial Officer), and Vijaya Gadde (Head of legal policy, trust, and safety). The deadline to complete the deal was Friday. If Musk failed to finalize the deal, he would face a legal battle with the company.

Elon Musk tweeted: “the bird is freed” to reference the deal. On Friday, the New York Stock Exchange suspended trading Twitter shares by saying it was “merger effective.”

In a message to advertisers, Musk wrote Twitter would not turn into “a free-for-all hellscape, where anything can be said with no consequences!” He also said: “The reason I acquired Twitter is because it is important to the future of civilization to have a common digital town square, where a wide range of beliefs can be debated in a healthy manner, without resorting to violence… There is currently great danger that social media will splinter into far-right wing and far left-wing echo chambers that generate more hate and divide our society.”

Thierry Breton (the EU Commissioner for the internal market) tweeted: “In Europe, the bird will fly by our EU rules.” Breton is suggesting the EU will not tolerate any relaxation of Twitter policies.

Big Tech experiences brutal earnings week – 10/28

Third-quarter results published this week reveal Big Tech companies suffered massive losses. Amazon, Meta, Alphabet, and Microsoft combined lost over $350 billion in market cap. The only company resisting the trend is Apple.

Meta, the parent company of Facebook, had its lowest average revenue per user in two years and came up short on earnings. Meta stock dropped 24% over the last five days. In an earnings call, Mark Zuckerberg stated: “There are a lot of things going on right now in the business and in the world, and so it’s hard to have a simple ‘We’re going to do this one thing, and that’s going to solve all the issues.” Microsoft fell 2.6% the same week, and Amazon plunged 13%.

Meanwhile, Apple stock rose 7.5% on Friday after the company reported its September earnings. Apple beat expectations on revenue and profit and had the best day for its stock since April 2020.

Samsung names Lee Jae-yong as the Executive Chairman – 10/27

On Thursday, Samsung announced it named Lee Jae-yong as the Executive Chairman. In 2017, Lee Jae-yong was convicted of bribery and embezzlement but received a presidential pardon in August. The pardon ended the five-year ban that prevented Lee from holding a formal position at the company.

The company stated: “The Board cited the current uncertain global business environment and the pressing need for stronger accountability and business stability in approving the recommendation.”

Meanwhile, Lee Jae-yong held a staff meeting on Tuesday. He promised to preserve his father’s legacy. Furthermore, he stated: “During this period, we have had to confront many challenges, and at times, we have struggled to make breakthroughs… Without a doubt, we are at a pivotal moment… Now is the time to plan our next move.”

Samsung announced ambitious plans in May to invest $350 billion into its business and create 80,000 new jobs. The earnings presentation revealed the company experienced a 31% drop in operating profits (compared to the same period last year). However, Samsung had record sales, and its revenue in the third quarter reached $54 billion.

Apple’s unionized workers say the company is withholding benefits – 10/28

Apple employees at the Towson Town Center store in Maryland were the first to unionize. Now they claim the company is not disclosing the truth, and making it difficult to bargain for their benefits as they renegotiate their contracts.

The unionized employees wrote a letter to Tim Cook. They expressed disappointment in learning that the company would not introduce new health and education benefits to the store workers that will be available to other retail employees. According to the IAM CORE (Coalition of Organized Retail Employees), the company is not sharing any details about the benefits.

Their letter states: “There is crucial context missing in this communication around the process of change within a unionized store and the fact that we can, and we will include these (and any new benefits) in our collective bargaining contract proposal.”

Bloomberg published a report that revealed Apple’s push to withhold benefits from unionized workers in Maryland. The workers would be missing out on new healthcare plan options, prepaid tuition in some colleges, and free Coursera subscriptions. Labor experts believe it is a calculated move by the company to stall or sway votes in the ongoing union drives elsewhere in the country.