 Bill Hwang, left, leaving court in Manhattan on Wednesday. | Image: NYT Archegos Capital Management founder Bill Hwang and former CFO Patrick Halligan were arrested on Wednesday and charged with securities fraud, wire fraud, and racketeering. Federal prosecutors allege the men unlawfully manipulated the prices of publicly traded securities in Archegos’ portfolio. The asset management firm collapsed in March 2021, resulting in over $10B in losses for banks and Archegos’ employees. More: - The men are accused of using leverage to inflate their market positions, which swelled to $160B.
- Hwang allegedly used derivative securities that do not require public disclosure to hide the size of Archegos’ market positions.
- As a result, investors were unaware Archegos dominated the trading of a few select companies, including Discovery Communications and ViacomCBS.
- When prices for these stocks fell, Archegos could not meet its margin calls, and the firm's counterparties suffered significant losses.
- Credit Suisse suffered the most, with about $5B in losses.
- The indictment was brought by the U.S. Attorney’s Office for the Southern District of New York.
- The SEC has also filed a civil suit.
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Facebook’s parent, Meta Platforms, released its Q1 2022 earnings on Wednesday, reporting its slowest revenue growth since its IPO in 2012. The company reported total revenue of $27.91B, up 7% YoY. Net income came in at $7.47B, down 21% YoY. Diluted EPS was $2.72, down ~18% YoY. Meta surpassed analysts’ expectations on Facebook’s daily active users (DAUs) and average revenue per user (ARPU). ARPU was $9.54. More: - Facebook’s DAUs were 1.96 billion, up 4% YoY, and monthly active users (MAUs) were 2.94 billion, up 3% YoY.
- Across the company’s family of platforms, including Instagram and WhatsApp, daily active people (DAP) was 2.87 billion, up 6% YoY.
- Monthly active people was 3.64 billion, up 6% YoY.
- Meta bought back $9.39B of its Class A common stock in Q1.
- The company expects Q2 total revenue to fall between $28B and $30B.
- Meta shares popped over 18% in after-market trading. The company is down over 48% year to date.
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Tesla CEO Elon Musk has won the shareholder lawsuit against him over Tesla’s $2.6B acquisition of SolarCity. In the suit, Tesla shareholders alleged that the 2016 purchase of SolarCity was not in Tesla's best interest. They accused Musk of controlling the board and using the deal to rescue SolarCity from insolvency. They wanted the court to order Musk to return the Tesla shares he received as part of the stock-for-stock deal. The shares are valued at about $13B today. More: - SolarCity was a solar energy company founded in 2006 by Musk’s cousins, Peter and Lyndon Rive.
- Musk owned a 22% stake in the company and was its chairman.
- In 2020, Tesla’s board of directors settled the claim against them for backing the SolarCity deal for $60M.
- Musk was the only Tesla director to challenge the investors’ claims in court.
- During the trial, Musk denied the claims and testified that he recused himself from Tesla board votes on the deal and had no role in negotiating the terms.
- Musk also noted the merger allowed Tesla to combine its battery business with SolarCity’s solar photovoltaics installations.
- Since the acquisition in 2016, Tesla’s share price has increased over 1,800%.
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 Margot Robbie as Barbie in Warner Bros' Barbie movie | Image: Warner Bros Toymaker Mattel has held talks with private-equity firms, including Apollo Global and L Catterton, about a potential sale. According to people familiar with the matter, the discussions are early and may not result in a deal. On Wednesday, the company released its Q1 2022 earnings, reporting $1.04B in net sales, up 19% YoY. Net income came in at $21M or 8 cents a share. More: - In January, Mattel announced it won the license to produce toys based on Walt Disney’s princess lineup and from the “Frozen” franchise, beating rival Hasbro.
- On Tuesday, Warner Bros Discovery released a teaser image for the upcoming live-action movie starring Mattel's popular Barbie toy.
- According to Mattel, about two Barbies are sold every second somewhere in the world.
- On the news of the potential buyout, Mattel shares closed up ~10.8% at $24.49.
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Boeing reported its Q1 2022 earnings on Wednesday, missing analysts’ expectations on revenue. The plane manufacturer reported revenue of $13.99B, down 8% YoY. Net loss increased to $1.24B, or $2.06 a share, from $561M reported a year prior. The company said it has suspended the production of its 777X plane through 2023. The delay would cost the company about $1.5B. Boeing also doesn’t expect to start delivering the planes until 2025. More: - Boeing delivered 95 planes in Q1, up from 77 delivered a year prior.
- Boeing has lost about $1.1B on costs associated with a deal to modify two 747 jumbo jets into Air Force Ones.
- Air Force One is the official designation for any plane carrying the president of the United States.
- CEO Dave Calhoun said the company probably shouldn’t have taken the deal for the planes.
- Boeing signed the deal for the two planes in 2018 under former CEO Dennis Muilenburg.
- Of the $1.2B in net loss reported for Q1, about $660M is associated with delays and higher Air Force One program costs.
- The company said it has submitted its 787 Dreamliner certification plan to the FAA.
- Boeing shares were down ~7.5% on Wednesday. It closed at $154.46 a share.
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- Nike has named a building on its campus after tennis star Serena Williams. The Serena Williams building is scheduled to open this week at the Nike World Headquarters in Beaverton, Oregon.
- SpaceX successfully launched four astronauts toward the International Space Station on Wednesday. This marks the fifth time SpaceX has launched astronauts to the ISS for NASA. The crew is expected to dock at around 8 p.m. ET.
- On Tuesday, investment platform Robinhood announced it is laying off about 9% of its full-time workers and cutting back on duplicate roles and job functions added during a period of hyper-growth from 2020 to H1 2021. Note: Inside.com's founder and CEO, Jason Calacanis, is an investor in Uber.
- Apple has opened a new online self-service store where customers can order replacement parts and tools for certain Apple devices. Customers can also view repair manuals on the site. Self Service Repair is currently available in the U.S. and will expand to other countries starting with Europe later this year.
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 |  | Vanessa Omeokachie is a Researcher at Inside. Her interests include finance, tech, and startups. In her free time, she enjoys reading, hiking, attending music festivals, and traveling. Connect with her on Twitter @VanessaOmeo or through email at vanessa@inside.com |  | | Editor | Aaron Crutchfield is based in the high desert of California. Over the last two decades, he has spent time writing and editing at various local newspapers and defense contractors in California. When he's not working, he can often be found looking at the latest memes with his kids or working on his 1962 Ford. | |
Laika is a unified compliance platform that automates workflows for audits, infosec monitoring, and vendor due diligence in a single, collaborative space. | |
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