TECH

You Poor SAP

Think you had an unproductive Monday? At least you didn't lose $35 billion (we hope). That's how much SAP's market value fell yesterday, following dismal Q3 earnings that tanked shares 23%.

• SAP who? Europe's biggest tech company by sales, SAP is a German software vendor that rose to prominence in the '70s and '80s selling enterprise resource planning software (which organizes business processes like HR, customer relationship management, and accounting into a shared database). 

Against the backdrop of rising Covid-19 infections, SAP cutting profit targets and hunkering down for a couple more quarters could be a worrying sign for other tech companies. Shares of SAP's competitors Salesforce and Oracle fell 3.4% and 4%, respectively.

SAP was already dealing with some clouds

In the last decade, SAP has moved to join its legacy tech peers IBM and Microsoft aboard the cloud computing bandwagon. 

• Back in the old days when you looked up your crush's number in the white pages, companies stored their data on computer servers in the office basement. With the rise of cloud computing, they can now buy that software over the internet and outsource the hardware to cloud infrastructure providers like Amazon, Google, and Microsoft. 

The cloud is cannibalizing the software licensing model SAP used to make its big bucks from. So SAP is pushing customers to cloud-based software subscriptions, which bring in less money upfront but offer a more predictable, recurring revenue stream. 

That transition takes time, even without a pandemic. While Covid-19 has accelerated cloud adoption, it's also created more uncertainty for businesses—forcing some to hit pause on big IT investments. 

• The latest wave of Covid infections means SAP is expecting to feel those impacts through the first half of 2021.

Big picture: Tech stocks have buoyed the market recovery, but SAP's plunge could undermine investor confidence in other software vendors facing similar headwinds.

IPO

Ant Group, Yesterday

Ant Group, the Chinese fintech giant, is set to raise at least $34.4 billion in its IPO, according to new pricing terms released yesterday. That would make it the largest public offering in history.

• Valued at around $313 billion, Ant will go public in Hong Kong and Shanghai in the coming weeks...and could raise even more if underwriters decide to buy up to 15% more shares. 

Our question: If Ant is now going to be the biggest IPO...who is it beating out? Saudi Aramco (raising $29.4 billion) is currently at the top, and here's the rest of the leaderboard. 

Francis Scialabba

ICBC = Industrial and Commercial Bank of China, and the company above that is the Agricultural Bank of China. 

GAMING

We’ve Come a Long Way Since Farmville

Facebook announced yesterday it’s rolling out a cloud gaming service, in case you wanted to do something on the platform other than check whether it's any of your friends' birthdays. 

It’s not the first to have the idea

Google, Amazon, and Microsoft have all rolled out their own cloud gaming platforms with eye-popping tech specs and exclusive titles to attract paying customers. But Facebook is taking a fundamentally different approach than its rivals, focusing on free games, like the Farmville of yesteryear, that you can play within the Facebook app at your leisure.

• This is supposed to be a casual and accessible gaming experience: “No special hardware or controllers needed; your hands are the controller,” Jason Rubin, Facebook’s VP of Play, wrote in a blog post. 

But one rotten Apple is cramping Rubin’s style. For now, FB’s games will only be available on Android and the web (not on iOS) because Facebook’s offering doesn’t jibe with Apple’s guidelines around streamable content.  

Bottom line: While rolling out a completely free-to-use service might not make business sense on the surface, Facebook makes money by keeping users on Facebook. Easy-to-pick-up, instantly available games streamed from the cloud might do just that. 

SPONSORED BY ATHLETIC GREENS

A Not so Routine Morning Routine Boost

We’ve become something of an expert in morning routines—what with being involved in millions of them.

While we pride ourselves on being your morning routine’s headliner, this morning, we have another rec to make: Athletic Greens.

Athletic Greens gives you your daily dose of multivitamins, minerals, pro / prebiotics, superfoods, and greens—all in one place. What our newsletter does for your brain, Athletic Greens does for your bod, covering all the nutritional bases you need to start your day right.

And don’t get scared off by the word “athletic”; this power powder helps anyone looking to own their health by providing quality nutrients that support your gut health, immune system, stress levels, and increased energy. 

So add Athletic Greens to your morning routine. If we haven’t convinced you yet, how ’bout this tasty immunity bonus: Anyone who orders here gets up to a year’s supply of Vitamin D, free.

ELECTION

Uber and Lyft Are Feeling Prop 22

This article is part of our weeklong series exploring state-level issues in the upcoming election. 

What's Prop 22? It's an effort to beat back Assembly Bill 5, a controversial measure the state of California passed last year. 

• AB5 forced gig economy companies (like Uber and Lyft) to classify their drivers as "employees" instead of what they currently call them: "independent contractors."

More than semantics are at stake

The contractor → employee shift carries a lot of legal luggage, like health benefits and minimum wage requirements. From the POV of Uber, Lyft, DoorDash, etc., that luggage is way too heavy. So after refusing to comply with AB5 and threatening to shut down in CA, they started throwing their weight behind Prop 22. 

And by weight, we mean cash. Uber and Lyft poured $57 million and $49 million, respectively, into the Yes on Prop 22 campaign, pushing total funding to nearly $200 million. In other words, Californians are about to vote on the most expensive ballot measure of all time.

Will it pass? Your guess is as good as ours: A new poll found that 46% of voters plan to vote in favor and 42% against. 

+ Dive deeper: We rounded up some articles that argue both sides. Read them here. 

SPACE

NASA Finds Flat Seltzer on the Moon

NASA had teased a big announcement about the moon for weeks, and yesterday it finally spilled the beans: There is water on the moon. 

To clarify, scientists have been hypothesizing about the presence of H₂O on the moon since 1971. But yesterday's announcement officially confirmed that 1) there is more of it than we thought and 2) it can exist outside the freezing craters in the moon's permanently shadowy polar regions. 

It's a big deal because...

NASA's Project Artemis is aiming to have a sustained human presence on the moon by 2028, and more accessible water can help achieve that goal. 

• It's not just for drinking: The water could be used to help with various life support functions, conduct new experiments with plant life, and even create rocket fuel.  

Bottom line: The Outer Space Treaty of 1967 prevents any nation from planting a flag on the moon and calling dibs. But as new discoveries and technological advances make the moon more hospitable to human life, new rules will have to be drafted to ensure every space-faring nation, as well as the burgeoning private space industry, gets a piece of the moon's cheese. 

WHAT ELSE IS BREWING

• BuzzFeed is on target to break even this year for the first time since 2014, reports the WSJ.
• Sixty-thousand people were placed under evacuation orders in California yesterday as a wildfire swept through Orange County.
• China is imposing sanctions on U.S. companies, including Boeing and Raytheon, that are involved in arms sales to Taiwan.
• Lordstown Motors, an electric vehicle company that recently merged with a SPAC, had a successful debut on the Nasdaq.
• KFC's fried chicken-scented fire logs are back.

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BREW'S BETS

Calling all marketers: Looking to snag an in-house position at an amazing brand? Marketing Brew put together a complete guide, featuring advice from a hiring manager and an interview with someone who got an in-house job during the pandemic. Check it out. 

Tech Tip Tuesday: No need to check Facebook for friends' birthdays. This Google Chrome extension will do it for you and throw them all on the calendar of your choice. 

Two cool things from China: A surreal new bookstore in Chengdu and a building that "walks" to its new home in Shanghai.

Zoom Halloween: Pair one of these 19 Zoom backgrounds with an accessory or two for a cheap and easy costume. Or check out these 60 DIY ideas for a more complete look. 

GAMES

Photojournalism Quiz

This photo was taken last Saturday in Washington state. What are these people doing? 

1. Helping destroy a nest of Asian giant hornets
2. Testing a new coronavirus-removal mechanism
3. Rehearsing an upcoming NASA spacewalk
4. Foraging for really poisonous mushrooms

ANSWER

A is correct. They're scientists wiping out a nest of "murder hornets"—new Halloween costume idea?