Three stories in tech stood out this week, featuring streaming-music company Spotify (NYSE: SPOT), tech giant Apple (NASDAQ: AAPL), and social network Facebook (NASDAQ: FB):
- Spotify's unusual direct listing went surprisingly well.
- Apple gave creators and professionals a better idea of when to expect the redesigned Mac Pro.
- Facebook CEO Mark Zuckerberg admitted to the social network's missteps.
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Here's what investors should know about each of these stories.
Spotify hits the stock market
Streaming music company Spotify saw its shares start trading on the stock market this week in an unconventional debut called a direct listing, in which Spotify bypasses investment-bank underwriting and doesn't issue any new shares. Instead, Spotify is essentially taking its shares straight to the New York Stock Exchange (a subsidiary of Intercontinental Exchange) by letting some registered shareholders sell some of their own shares.
Without any investment bankers to set an official starting price for the stock, there was concern that shares would trade with exceptional volatility when they hit the New York Stock Exchange. But the stock has been more resilient than expected since its April 3 debut. With the stock opening at $165.90, shares settled between about $145 and $150 as the week went on. The stock closed out the week at $147.92, with a $26.4 billion valuation. This puts Spotify's valuation at about 5.3 times sales.
The revamped Mac Pro is "a 2019 product"
About a year ago, Apple admitted it had taken its Mac Pro in the wrong direction, frustrating many professional users who have been Mac customers for years. To address the situation, Apple executives confirmed last year that the company was working from the ground up on a "completely rethought" modular Mac Pro.
Apple said last year that the revamped Mac Pro would come sometime after 2017. But now Apple's senior director of Mac hardware product marketing, Tom Boger, is saying the product won't launch until 2019, according to TechCrunch. "We want to be transparent and communicate openly with our pro community," Boger said, "so we want them to know that the Mac Pro is a 2019 product. It's not something for this year."
With Apple's Mac revenue up 9% year over year in the trailing-12-month period, another catalyst for the segment could help the company build on the momentum it's seeing in its Mac business. But investors will have to wait until 2019 to see the Mac Pro's impact on the segment.
Zuckerberg admits to Facebook's "huge mistake"
Facebook said in a press release last month that its policies and procedures to protect users' information failed to prevent a third-party developer from mishandling user data, resulting in a data company collecting profile data on as many as 87 million users. Since then, the stock has sunk about 15%.
CEO Mark Zuckerberg attempted to ease concerns this week in a press conference in which he admitted that the company has erred not only in this case, but also in not mitigating abuse, fake news, hate speech, and foreign influence in elections.
"We didn't take a broad enough view of what our responsibility is, and that was a huge mistake," Zuckerberg said. "It was my mistake."
Zuckerberg's remorseful attitude is good news for investors, who are hoping the company can prove to both users and marketers that it can correct its missteps.
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