Uber is lowballing its I.P.O.

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Uber’s cautious approach to its I.P.O.

The ride-hailing giant disclosed this morning that its I.P.O. could value it at $91 billion — less than what it had told some investors to expect a few weeks ago.

Uber set a price range of $44 to $50 for its stock sale, leading to a valuation of $80 billion to $91 billion. It had mentioned a figure of $100 billion to some bond investors, and some bankers had suggested it shoot for $120 billion.

This might be a Lyft effect. Shares in that ride-hailing company are 22 percent below the price at their debut last month, not a look Uber wants to copy. Kathleen Smith of Renaissance Capital, which tracks I.P.O.s, told the NYT: “The best way to avoid breaking your I.P.O. price is to be conservative when you start out with your valuation.”

The pricing could still change depending on how much enthusiasm Uber gets from potential investors during its roadshow.

But someone’s definitely buying in: PayPal. The payment company will invest $500 million in the ride-hailing giant at its I.P.O. price.

Uber will begin its roadshow today, and could begin trading on the public markets in a few weeks.

Regulators are coming for Facebook

Yesterday’s news about the Federal Trade Commission potentially fining Facebook up to $5 billion was met by many with disdain because it didn’t go far enough. But that might not be all the F.T.C. does, Cecilia Kang and Adam Satariano of the NYT report:

• “The company and F.T.C. officials have discussed additional mandates,” the two report, citing unnamed sources.
• “Among conditions that are being discussed by the F.T.C. are stronger monitoring of Facebook’s privacy practices and greater restraints on how the company shares data with third parties.”
• Such conditions could set “standards for future privacy violations” and influence “the creation of privacy regulations in the United States and other countries.”
• “But the conditions are not finalized and could change.”

Other agencies are at work, too:

• “In Europe, officials in Britain, France, Germany and Ireland are scrutinizing the social media company’s practices.”
• “Just this week, the Irish Data Protection Commission started a fresh inquiry into Facebook exposing user passwords.”
• “Governments in Australia, India, New Zealand and Singapore have passed or are considering new restrictions on social media.”
• The New York attorney general’s office yesterday said it was investigating how Facebook gained access to the email address books of more than 1.5 million users without permission.
• And a new investigation by officials in Canada into the Cambridge Analytica data scandal determined that Facebook violated national and local laws. The company has disputed the report.

This global scrutiny represents “a massive wave of outrage that will crash straight into the central premise of the company’s business model,” Ben Scott, a former State Department official in the Obama administration, told the NYT. New regulations on Facebook, it now seems, are inevitable.

One-day shipping? That’ll be $800 million

Amazon announced yesterday that it will take a big hit to its second-quarter earnings this year as it spends $800 million to offer next-day delivery around the world.

It’s a bid to draw more customers, winning them over with sheer convenience.

Most of the spending will be in North America, where Prime members currently get free two-day shipping, according to Brian Olsavsky, the company’s C.F.O. “The company did not give a timeframe for when it expected the offer to be available to all members, or how many products would become eligible for one-day shipping,” the FT reports.

But Amazon’s growth has slowed. While the company announced its best-ever quarterly profit, $3.56 billion, and a record quarterly operating margin of 7.4 percent, the WSJ notes, its revenue grew by just 17 percent year over year. That’s the slowest in four years.

“It’s hard to say Amazon’s go-go growth days are gone for good,” Shira Ovide of Bloomberg Opinion writes. “Amazon is just scratching the surface in food, health care, home furnishings, corporate tech, advertising and much more. The size of Amazon’s opportunity, however, makes it all the more baffling that the company has hit a growth lull.”

Who owns Huawei? It’s complicated

The Chinese telecom giant tried to disclose its ownership structure yesterday, to counter American claims that it’s secretly controlled by Beijing. It didn’t exactly work, Ray Zhong of the NYT reports.

• The secretary of Huawei’s board, Jiang Xisheng, explained that the company “is owned by a labor union that solicits donations from employees when their colleagues have health problems and the like.”
• “The union also supervises the company basketball club.”
• Huawei also showed off a big blue book usually locked away at its headquarters in Shenzhen. Within it “are said to be the names of all the Huawei employees who hold ‘restricted phantom shares’ in the company — proof, the company says, that no piece of Huawei is owned by the Chinese government.”
• But two American researchers say “Huawei’s virtual stock program ‘has nothing to do with financing or control’ and is ‘purely a profit-sharing incentive scheme.’ ”
• Mr. Jiang rejected that argument, adding that with some people, “no matter what you say to them, they will only say what they want to say. They won’t listen to you.”

We hope that cleared things up.

More: Huawei spent $15.3 billion on research and development last year, more than any company except Amazon, Alphabet and Samsung. Here are the countries that have (and haven’t) banned Huawei 5G equipment.

Bill McGlashan shared his college admissions guru 

TPG has concluded an internal investigation into Bill McGlashan, a onetime rising star at the firm who has been caught up in the recent college admissions scandal. Here’s what the investment giant found:

• Mr. McGlashan introduced Rick Singer, the man accused of helping clients get their children into college by cheating on exams and faking athletic profiles, to TPG executives.
• The introductions were reportedly made before Mr. McGlashan had participated in the fraudulent scheme.
• TPG’s deal team quickly decided not to invest in Mr. Singer’s business proposals, and TPG says that none of its resources were involved in Mr. Singer’s alleged fraud.
• Two other TPG employees hired Mr. Singer, for what the firm said was legitimate college counseling.

TPG has stripped Mr. McGlashan of all profits from its Growth and Rise funds, which he oversaw until he was fired (or, according to him, left). They have stakes in Silicon Valley darlings like Uber and Airbnb.

Expect a legal fight over what could be tens of millions of dollars.

China reboots Belt and Road

In the face of criticism about overpriced and superfluous projects, China is reshaping and retooling its grand infrastructure plan, known as the Belt and Road Initiative, Jane Perlez of the NYT writes:

• “The program has broadly drawn concerns from officials in Western Europe and the United States. The Trump administration has called the project predatory.”
• “But Beijing isn’t retreating from its vision to build a network of ports, rails and roads.”
• “Rather, China’s efforts are intended to present a friendlier face to global leaders.”
• “To show it’s a more responsible player, China is promising corruption-free, environmentally conscious ventures.”
• “It is also seeking advice from major multinational banks, asking other countries, such as Japan, to collaborate, and in some cases scaling back its projects.”

Many nations remain skeptical. America is pushing ahead with an alternative plan led by the revamped Overseas Private Investment Corporation. And the European Commission vice president Maros Sefcovic has said that Beijing must provide “more transparency and more information” if more countries are to sign up.

Revolving door

The grain-trading giant Bunge has named Greg Heckman as its permanent C.E.O.

Snap has hired Kenny Mitchell, a former executive at McDonald’s and Gatorade, as its first chief marketing officer.

Three members of Apple’s industrial design team — Rico Zorkendorfer, Daniele De Iuliis and Julian H?nig — have reportedly decided to leave.

The OxyContin maker Purdue Pharma said that its chief medical officer, Marcelo Bigal, and head of R.&D., John Renger, plan to leave.

3M said it plans to cut 2,000 jobs after a slowdown.

The speed read

Deals

• Magic Leap has raised $280 million from NTT DoCoMo of Japan and will reopen its most recent fund-raising round. (NYT)
• Comcast is reportedly in discussions to sell its 30 percent stake in Hulu to Walt Disney. (CNBC)
• Private-market investors have valued Slack at about $17 billion as it prepares for a likely public-market debut. (CNBC)
• Saudi Arabia’s sovereign wealth fund plans to raise billions of dollars in debt to finance investments. (WSJ)
• Laurene Powell Jobs has quietly turned her charitable foundation into a venture-capital powerhouse. (Bloomberg)

Politics and policy

• White House officials have reportedly urged Republican lawmakers to quickly raise the U.S. debt ceiling. (WaPo)
• A Pentagon ethics inquiry cleared the acting defense secretary, Patrick Shanahan, of accusations that he favored his former employer, Boeing, in official discussions about military contractors. (NYT)
• President Trump and Rudy Giuliani denied that the president asked his former White House counsel, Don McGahn, to fire Robert Mueller. Mr. McGahn’s lawyer disagreed. (NYT)

Trade

• President Trump said that President Xi Jinping of China would visit the White House soon, suggesting a trade deal is imminent. (NYT)
• Steve Bannon and the hedge fund manager Kyle Bass accused Wall Street of “funding” China’s trade fight with the U.S. (CNBC)

Tech

• A federal judge granted Elon Musk and the S.E.C. an extra week to hash out their differences over his Twitter habit. (WSJ)
• Intel lowered its financial expectations for the year. It also clarified that it had decided to quit the 5G smartphone modem market afterApple and the 5G modem front-runner, Qualcomm, settled their legal disputes. (WSJ, Verge)
• The New York attorney general’s office says that the cryptocurrency exchange Bitfinex covered up an $850 million loss of customer funds. Cryptocurrencies slid on the news. (Axios, Bloomberg)
• Twitter reportedly chose not to automate banning of white supremacists for fear that Republican politicians would be caught up. (Motherboard)
• Facebook is banning personality quiz apps. Thank Cambridge Analytica. (Verge)

Best of the rest

• Morgan Stanley agreed to pay $150 million to settle claims by California that it had misled investors about the risks of mortgage-backed securities. (NYT)
• Carlos Ghosn was released from a Tokyo jail yesterday. (NYT)
• The Commodity Futures Trading Commission is investigating Glencore over potential corruption. (FT)
• Anna Sorokin, who successfully conned businesses and banks, was found guilty yesterday of multiple fraud charges. (BuzzFeed News)

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