MOODY’S: Concerns Flagged Over China

Moody's Investors Service has revised its assessment of Chinese sovereign bonds, shifting the outlook from stable to negative. This move highlights the growing global apprehension regarding the substantial debt levels in the world's second-largest economy.

In its statement, Moody's maintained a long-term rating of A1 for the nation's sovereign bonds while expressing concerns about China's utilization of fiscal stimulus to bolster local governments and the escalating challenges posed by the property market downturn. These factors are seen as potential risks to the nation's economy, as indicated by the rating agency.

Moody's shift in perspective coincides with the worsening property market situation in China, prompting a transition towards fiscal stimulus as a primary measure to strengthen the nation's economy. This shift has increased borrowing, raising alarms about China's escalating debt levels. Beijing is on course for record bond issuance this year, further fueling these concerns.

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GITLAB: Remote Model, Real Gains

GitLab delivered an impressive earnings report that left a strong impression on Wall Street, resulting in an 18% surge in its stock price following the announcement. For the quarter ending on October 31, GitLab reported a substantial 32% year-over-year growth in revenue. The company also disclosed a net loss of $285.2 million, which translates to $1.84 per share, a notable contrast to the net loss of $48.5 million, or $0.33 per share, recorded in the same quarter the prior year.

Since its IPO in 2021 and its unique remote operating model, GitLab has attracted 874 customers who collectively contribute annual recurring revenue exceeding $100 million. This represents a remarkable 37% increase compared to the corresponding quarter in the previous year.

Earnings:

• EPS: $0.09 per share vs. - $0.01 per share expected

• Revenue: $149.7 million, vs. $141.5 million expected

META: Forging Alliance with IBM

Meta Platforms and International Business Machines (IBM) have collaborated to launch a collation comprising more than 50 artificial intelligence (AI) companies and research institutions. This coalition aims to promote what they term an "open AI model" in an effort to gain traction within the rapidly growing AI market.

The AI Alliance includes notable members such as Intel, Oracle, Cornell University, and the National Science Foundation. Their collective objective is to combine resources and champion the principles of "open innovation and open science" in the realm of AI.

A significant portion of the alliance's members strongly endorse the open-source approach, which involves the free sharing of technology and draws from a history of collaboration among major technology firms, academic institutions, and an enthusiastic community of independent programmers

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Beverage Breakthrough - Defying Inflation

This man became a billionaire by never raising the price of his product.

Most companies raise product prices and blame inflation.

However, Arizona Iced Tea isn’t like most companies. They have famously kept prices stuck at 99 cents since 1992. If they were to keep up with inflation, the price of tea would be almost $3.00!

You might wonder how they've managed this feat in a world where prices are always climbing—the secret lies in their clever business strategy. Arizona Iced Tea focuses on cost-effective measures like bulk selling, shipping at night, and avoiding expensive advertising channels.

The company also leverages its iconic, oversized cans as a marketing tool, eye-catching enough to attract buyers without needing costly ad campaigns. This combination of intelligent packaging, bulk sales, and minimal advertising expenses allows Arizona to maintain its 99-cent price tag, making it a standout in the beverage industry for its commitment to affordability and consistency.

Chart of the Day

📊 Since around 2015, the general investor sentiment has been bearish. Are we destined for a longer bull cycle soon?

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