Softbank is currently stockpiling cash in preparation for a worst-case pandemic scenario, according to CEO Masayoshi Son. While he acknowledges that there appear to be effective vaccines and COVID-19 treatments coming soon, he remains pessimistic. He believes that there could be second and third waves globally that will negatively impact the world's economies. 

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• Softbank has been selling off assets all year. It initially planned to sell $41B worth of assets but has more than doubled that target. 
• Softbank last week reported that it had lost $1.3B from investing in listed stocks. Softbank also lost billions on WeWork in 2019. 
• Masayoshi Son's best bet was a $20M investment in Alibaba 20 years ago. It was worth $60b when the company IPO'd in 2014. 
• He is currently invested in Google, Amazon, Facebook, Apple, and other AI space players. 

What do you think of Masayoshi Son's strategy?

Target reported revenue of $22.6B for Q3 2020, up 21% YoY. The company's profit stood at $1b, up 41% YoY.

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• The company's online sales grew by 155%, contributing to around 10% of the overall increase. Same day delivery services increased by 217%. 
• Delivery service provider Shipt's revenue increased by 280%. Target bought Shipt for $550M in 2017. 
• Target reported that the number of transactions online and in its stores increased by 4.5% YoY, and the average transaction size increased by 15.6% YoY. Yesterday, Walmart said that shoppers' number of trips decreased by 12%, but the volume of shopping during their visits increased by 24%.

Other big-box retailers:

Walmart:

• Walmart reported revenue of $134B for Q3 2020, up 5% YoY. The company's profit stood at $5.1B, up 45% YoY. 
• Walmart's U.S. e-commerce sales increased by 79%, and Sam's Club's e-commerce sales increased by 41%.
• The company's international division contributed to revenue of $30B, up 1.4% YoY, but its operating income increased 70% YoY to $1B.

Home Depot:

• Home Depot's revenue increased 23% YoY to $33.5B. The company's net income stood at $3.4B, up 24% YoY.
• The company's U.S. same-store sales increased by 25%, and the average transaction size increased 10% YoY to $73. 

Apple announced that it reduced the App Store revenue share from 30% to 15% for developers who earn less than $1M in annual sales. The change would come into effect by Jan. 1, 2021, and this is the first time Apple has reduced its 30% revenue share for a massive number of developers since the store's inception in 2008.

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• Current app marketplace revenue share: (paid apps, digital subscriptions, and in-app purchases)
  • Google Play Store – 30% (15% for subs after 12 months) 
  • Apple App Store – 30% (15% for subs after 12 months)
  • Amazon Appstore – 30% 
  • Microsoft Store – 30% on games, Business and Education stores, and 15% otherwise
• App Store has more than 28 million developers. Previously, Apple said that around 85% of the App Store apps are free, and it earns no revenue from those apps. 
• For the last quarter, the company's services segment (including revenue from App Store and subscription revenue from services like Apple Music) generated $14.5B revenue, up 17% YoY, contributing to 20% of overall revenue. For the last FY, the segment generated revenue of $53.7B, up 25% YoY.
• Apple's App Store generated revenue of $50B last year. Google's Play Store generated revenue of $29B in the same period. As a standalone, the App Store would rank #66, and the Play Store would rank #108 in Fortune 500 companies.

App Store controversies: 

• In the antitrust hearings attended by the Big Tech CEOs in July, the questions for Apple CEO Tim Cook were focussed on its monopoly in the App Store. In September, companies including Spotify, Epic Games, and Match Group have formed a nonprofit coalition to push for App Store changes.
• Apple and Google banned "Fortnite" from their app stores after the gaming company introduced a payment option to avoid the platforms' commission. The case is scheduled for a trial in May 2021.
• In June, the EU launched an investigation into Apple for its App Store policies following complaints from Spotify and an e-book/audiobook distributor. The U.S. Justice Department and Federal Trade Commission have also launched investigations against Apple's antitrust practices.
• Since the revision announced today applies to developers earning less than $1m in all their apps, companies like Fortnite and Spotify will not be affected.
• Facebook and Microsoft also expressed concerns over Apple’s control of its App Store, following the roadblocks they faced to release their own games.

U.S. mortgage debt hit a record high of nearly $10T last quarter. The debt is credited to low-interest rates, which have boosted housing markets across the country. Mortgage rates have already hit record lows 12 times this year, giving buyers financial incentives to incur debt as they purchase properties. 

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• Q3 2020 saw Americans take on an additional $85B in mortgage debt. 
• The mortgage debt in America is now significantly higher than before the 2008 financial crisis. 
• Low-interest rates have also led to a record high of $1.36T in outstanding auto loans.
• Overall, American households have the highest levels of debt in the nation's history. As of September 2020, they owe over $14.30T. 

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