What We’re Reading This Week [November 11, 2022]
On November 8th, Fortune reported on the sudden implosion of FTX, the second biggest crypto exchange. The value of FTX’s proprietary token — FTT — started dropping precipitously this week as various news reports came out about it and more and more owners began to sell. The owner of FTX, known as SBF, tried to defend its value by selling other assets in order to buy up the FTTs flooding the market, but to no avail, and by Tuesday his companies were facing insolvency. [Fortune; Nov. 8, 2022]. The New York Times reported on November 11th that SBF resigned as CEO of FTX, and FTX filed for bankruptcy. This filing is the latest, and by far the largest, in a series of crypto related bankruptcies this year. [New York Times; Nov 11, 2022].
On November 9th, Reuters reported that cancer drug maker, Clovis Oncology, had stated it was likely to file for bankruptcy in the near term. Clovis has been struggling to sell its cancer drug Rubraca. Sales of Rubraca have been hit by intensifying competition from rival ovarian cancer treatments, and also by lower cancer diagnoses during Covid lockdowns. Rubraca sales fell by 10% to $148.8 million in the 2021 financial year, compared to $164.5 million a year earlier. [Reuters; Nov. 9, 2022].
According to Yahoo Finance, recent layoffs by Facebook parent company Meta mark a turning point for the company. Meta’s stock dropped close to 70% last year, and earnings over the last several quarters have also been down In the second quarter of this year, Meta reported its first year-over-year drop in sales, and in the following quarter, it reported its second ever decline. Many are attributing the recent loss in value to the company’s singular focus on the immersive “metaverse” experience, the rise of rival social media platform TikTok, privacy changes by Apple that have hurt advertising revenue and the lack of Gen Z users. [Yahoo; Nov. 10, 2022].
