Over and done with…
The invasion of privacy lawsuit that forced Gawker into bankruptcy has finally come to a close. Well, almost. All Gawker needs to do is write a check to Hulk Hogan for $31 million, which is actually small potatoes considering that the original judgement against Gawker was for $140 million. Hogan’s suit was helped by the fact that PayPal co-founder Peter Thiel secretly financed the suit. He’s no fan of Gawker founder Nick Denton ever since he outed Thiel back in 2007. Of Hogan’s lawsuit, Thiel said, “I saw Gawker pioneer a unique and incredibly damaging way of getting attention by bullying people even when there was no connection with the public interest.” He makes a valid point. In any case, Gawker was forced to file Chapter 11 bankruptcy and the company’s assets were sold in a government auction to Univision for the bargain price of $135 million. But I guess that’s what you’d call payback.
Yelp had a nice surprise today in the form of a profit. And who doesn’t like a surprise like that? However, with that profit came the news that the company would be saying goodbye to 175 employees – 4% of its workforce – since the company has been unsuccessful in its attempts to expand across the pond. Yelp, which reviews restaurants and other assorted businesses, makes its money through advertising, of course, and also through other services like online reservations. The company’s third quarter net income was $2.1 million, earning the site 22 cents per share, even though experts predicted a 3 cent per share loss. The company’s revenue rose by 30% to $186.2 million, again beating expectations of $183 million. That was a major change from Yelp’s year-over-year profit loss of $8.1 million and 11 cents per share. The company saw a 29% uptick in reviews which brought its total customers to 115 million users.
Leave it to the presidential race to send gun sales soaring. Both Sturm-Ruger and Smith & Wesson have been reporting months of record gun sales. In the meantime, FBI background checks to purchase firearms rose 16% to 2.3 million this year from last year’s 2 million during the same period. And you can expect background checks to set a new record for 2016. How’s that for a correlation? Anticipating new gun-control regulations, gun enthusiasts are stocking up as the second amendment figures prominently in this election. As a result, Sturm-Ruger not only experienced a sales surge back in the summer, but saw net sales in its third quarter jump 34% 10 $161.4 million as consumers loaded up on such favorites like concealed-carry pistols and AR-15 rifles. Profits also went up for the company 66% to $20 million and $1.03 per share. Sturm-Ruger took all possible political outcomes into consideration both in the White House and the Senate. While Hillary Clinton hopes to bring back the assault weapons ban, Donald Trump wants to tweak gun legislation and focus on healthcare for the mentally ill instead. The irony is that Sturm-Ruger sales went up following incidents involving gun violence that led to politicians demanding stricter gun-control laws. If gun enthusiasts feel that it will be more difficult to purchase guns in the future, they stock up now. During Sturm’s second quarter earnings call, the company implored its customers and “all freedom-loving Americans to take action in support of the Second Amendment.” Sturm-Ruger pledged $2 to the NRA for every gun it sold and offered to match all donations up to $5 million. Incidentally, despite record gun sales, shares of both Smith and Wesson and Sturm-Ruger had been down 11%. Look for Smith & Wesson’s earnings December 6.