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Despite healthy orders, can Just Eat deliver on share price growth? | Food & drink industry

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Ordering a takeaway and sitting down with a box set was the height of entertainment for most people during successive coronavirus lockdowns – and this served up bumper sales and profits for a string of food delivery companies.

But now that restaurants, cafes and other hospitality venues have reopened, will consumers lose their taste for ordering and go back to eating out?

Investors will get more answers about how food delivery firms are faring following the easing of Covid restrictions when Just Eat Takeaway releases its first-half results on Tuesday. The food delivery service’s revenue for the quarter to June is forecast to hit €1bn (£850m), according to the average estimate of analysts polled by Reuters.

The company, which is headquartered in Amsterdam, has already indicated that orders rose by 61% between January and June and raised its overall order growth guidance for 2021 – excluding US-based Grubhub – to 45% from 42%.

Last week, Just Eat’s main UK rival, Deliveroo, painted a fairly rosy picture of post-lockdown trading for food delivery companies, dishing up news that it had more than doubled its customer orders in the first half of 2021 as appetite for takeaways continued to grow even after hospitality venues reopened.

Deliveroo’s founder and chief executive, Will Shu, cautioned that demand for food deliveries “may moderate later in the year”, but also said he believed the pandemic had accelerated consumers’ shift to buying food online.

In this highly competitive market, Just Eat has size on its side. It was formed when Dutch firm Takeaway took over UK rival Just Eat in a fortuitously timed £6.2bn deal in early 2020. The buying spree continued when Just Eat Takeaway snapped up Grubhub for £5.8bn – securing access to the lucrative US market and creating the largest food delivery service outside China, serving customers in 25 countries.

Earlier this year, Just Eat – which also competes with Uber Eats in the UK – said it had put “tremendous effort” into improving its British business, doubling its salesforce and increasing restaurant choice.

It said this investment had already helped it gain online share in the UK (where pizza is the most-popular dish, followed by Chinese and Indian meals) – especially in London – and added that it expected pre-tax losses to have peaked by June.

Despite these positive noises, Just Eat’s share price performance has been disappointing in recent months, and has been on a downward trend since October last year, when it hit a peak of €110. It’s currently hovering just under €73.

The company’s low valuation has irritated one of its largest shareholders, US-based Cat Rock Capital, which holds a 4% stake. In a presentation entitled “Just Eat must deliver”, it described the company as a “fantastic” business, but criticised its relations with investors.

It blamed “deeply flawed communication” for Just Eat being “deeply undervalued and vulnerable to takeover bids at far below intrinsic value”.

In a crowded market, where new competitors are snapping at its heels, Just Eat enjoys widespread name recognition with consumers.

“Just Eat pulled a blinder with their sponsorship of the Euros football this summer,” said Danni Hewson, financial analyst at stockbroker AJ Bell, pointing out that the company’s share price rose before any England match. She added that continued order growth could make investors take another look at food delivery firms’ shares.

“They seem undervalued, Just Eat and Deliveroo both,” she said. “As you start to see these businesses maintain that delivery share, they won’t build on it in the same way, but they will maintain it. That is when investors may start to think it’s time to take a look at the business, particularly if they can claw their way to profit.”

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Amazon Web Services outage hits sites and apps such as IMDb and Tinder | Amazon

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Several Amazon services – including its website, Prime Video and applications that use Amazon Web Services (AWS) – went down for thousands of users on Tuesday.

Amazon said the outage was probably due to problems related to application programming interface (API), which is a set of protocols for building and integrating application software, Reuters reported.

“We are experiencing API and console issues in the US-East-1 Region,” Amazon said in a report on its service health dashboard, adding that it had identified the cause. By late late afternoon the outage appeared to be partially resolved, with the company saying that it was “working towards full recovery”.

“With the network device issues resolved, we are now working towards recovery of any impaired services,” the company said on the dashboard.

Downdetector showed more than 24,000 incidents of people reporting problems with Amazon. It tracks outages by collating status reports from a number of sources, including user-submitted errors on its platform.

The outage was also affecting delivery operations. Amazon’s warehouse operation use AWS and experienced disruptions, spokesperson Richard Rocha told the Washington Post. A Washington state Amazon driver said his facility had been “at a standstill” since Tuesday morning, CNBC reported.

Other services, including Amazon’s Ring security cameras, mobile banking app Chime and robot vacuum cleaner maker iRobot were also facing difficulties, according to their social media pages.

Ring said it was aware of the issue and working to resolve it. “A major Amazon Web Services (AWS) outage is currently impacting our iRobot Home App,” iRobot said on its website.

Other websites and apps affected include the Internet Movie Database (IMDb), language learning provider Duolingo and dating site Tinder, according to Downdetector.

The outage also affected presale tickets for Adele’s upcoming performances in Las Vegas. “Due to an Amazon Web Services (AWS) outage impacting companies globally, all Adele Verified Fan Presales scheduled for today have been moved to tomorrow to ensure a better experience,” Ticketmaster said on Twitter.

In June, websites including the Guardian, Reddit, Amazon, CNN, PayPal, Spotify, Al Jazeera Media Network and the New York Times were hit by a widespread hour-long outage linked to US-based content delivery network provider Fastly Inc, a smaller rival of AWS.

In July, Amazon experienced a disruption in its online stores service, which lasted for nearly two hours and affected more than 38,000 users.

Users have experienced 27 outages over the past 12 months on Amazon, according to the web tool reviewing website ToolTester.



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South Korea sets reliability standards for Big Tech • The Register

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South Korea’s Ministry of Science and ICT has offered Big Tech some advice on how to make their services suitably resilient, and added an obligation to notify users – in Korean – when they fail.

The guidelines apply to Google, Meta (parent company of Facebook), Netflix, Naver, Kakao and Wavve. All have been told to improve their response to faults by beefing up preemptive error detection and verification systems, and create back up storage systems that enable quick content recovery.

The guidelines offer methods Big Tech can use to measure user loads, then plan accordingly to ensure their services remain available. Uptime requirements are not spelled out.

Big techs is already rather good at resilience. Google literally wrote the book on site reliability engineering.

The guidelines refer to legislation colloquially known as the “Netflix law” which requires major service outages be reported to the Ministry.

That law builds on another enacted in 2020 that made online content service providers responsible for the quality of their streaming services. It was put in place after a number of outages, including one where notifications of the problem were made on the offending company’s social media site – but only in English.

The new regulations follow South Korean telcos’ recent attempts to have platforms that guzzle their bandwidth pay for the privilege. Mobile carrier SK Broadband took legal action in October of this year, demanding Netflix pitch in some cash for the amount of bandwidth that streaming shows – such as Squid Game – consume.

In response, Netflix pointed at its own free content delivery network, Open Connect, which helps carriers to reduce traffic. Netflix then accused SK Broadband of trying to double up on profits by collecting fees from consumers and content providers at the same time.

For the record, Naver and Kakao pay carriers, while Apple TV+ and Disney+ have at the very least given lip service to the idea.

Korea isn’t the only place where telcos have noticed Big Tech taking up more than its fair share of bandwidth. The European Telecommunications Network Operators’ Association (ETNO) published a letter from ten telco CEOs asking that larger platforms “contribute fairly to network costs”. ®

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Twitter acquires Slack competitor Quill to improve its messaging services

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As part of the acquisition, Quill will be shutting down at the end of the week as its team joins the social media company.

Twitter has acquired the messaging platform Quill, seen as a potential competitor to Slack, in order to improve its messaging tools and services.

Quill announced that it will be shutting down at the end of the week as its team joins the social media company to continue its original goal “to make online communication more thoughtful, and more effective, for everyone”.

The purchase of Quill could be linked to Twitter’s new strategy to reduce its reliance on ad revenue and attract paying subscribers.

Twitter’s general manager for core tech, Nick Caldwell, described Quill as a “fresher, more deliberate way to communicate. We’re bringing their experience and creativity to Twitter as we work to make messaging tools like DMs a more useful and expressive way people can have conversations on the service”.

Users of Quill have until 11 December to export their team message history before the servers are fully shut down at 1pm PST (9pm Irish time). The announcement has instructions for users who wish to import their chat history into Slack and states that all active teams will be issued full refunds.

The team thanked its users and said: “We can’t wait to show you what we’ll be working on next.”

Quill was launched in February with the goal to remove the overwhelming aspects of other messaging services and give users a more deliberate and focused form of online chat.

In an online post, Quill creator Ludwig Pettersson said: “We started Quill to increase the quality of human communication. Excited to keep doing just that, at Twitter.”

The company became a potential competitor for Slack, which was bought by Salesforce at the end of 2020 for $27.7bn. The goal of that acquisition was to combine Salesforce’s CRM platform with Slack’s communications tools to create a unified service tailored to digital-led teams around the world.

Last week, Salesforce announced the promotion of Bret Taylor to vice-chair and co-CEO, just days after he was appointed independent chair of Twitter after CEO Jack Dorsey stepped down.

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