Event Recap
Event Recap

Aiera Investor Event Recap - Week of February 14, 2022

Nvidia's confident growth trajectory, Economic volatility legitimizes AI lending, Airbnb leading travel shift with hybrid workers, digital transformation continues for all restaurant types.

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Q4 Earnings Season Report | February 14-18, 2022

Most Notable Topics and Themes This Week:

  • Nvidia’s (-1.8% since close) confidence in gaming & data center growth trajectory
  • Economic volatility legitimizes AI lending, says Upstart (+23.7% since close)
  • Avis Budget Group (-11.3% since close) posts record quarter, but misses on one key metric
  • Airbnb (+3.6% since close) leading transformation in travel with longer stays for hybrid/remote workers
  • Traditional hotel groups trying to rebound, differentiate from short-term rentals
  • The digital transformation continues for ALL types of restaurants

Transcripts Cited in this Report:

Nvidia Offers Strong Revenue Outlook on Chip Demand and AI Appetite

Gaming (Nvidia’s Largest Market) Sees Sustained Demand for Processors as Video Games Continue to Advance Technologically

“Starting with Gaming. Revenue of $3.4 billion rose 6% sequentially and was up 37% from a year earlier. Fiscal year revenue of $12.5 billion was up 61%. Gaming has become the top entertainment medium that continues to show strong momentum. Just last month, Steam hit a record 28 million concurrent users, up 50% in 2 years.”

  • Colette M. Kress, Executive VP & CFO, NVIDIA Corporation | Q4 2022 NVIDIA Corp Earnings Call, Feb 16th, 2022

Data Center Sales Rose 71% YoY, Citing Strong Appetite for AI Applications

“Moving to Data Center. Record revenue of $3.3 billion grew 11% sequentially and 71% from a year earlier. Fiscal year revenue of $10.6 billion was up 58%. Data center growth in the quarter was once again led by our compute products on strong demand for NVIDIA AI. Hyperscale and cloud demand was outstanding, with revenue more than doubling year-on-year. Vertical Industries also posted strong double-digit year-on-year growth led by consumer Internet companies.”

  • Colette M. Kress, Executive VP & CFO, NVIDIA Corporation | Q4 2022 NVIDIA Corp Earnings Call, Feb 16th, 2022

Tonal + Textual Confidence on Full Display from Nvidia CFO When Discussing Growth Trajectory

“For Q1, our guidance can include an acceleration of Data Center from where we left in terms of Q4. We will have growth across several of our market platforms within Q1, both Data Center, Gaming and probably a couple of others. But yes, there is expected to be accelerated growth as we move into Q1.”

  • Colette M. Kress, Executive VP & CFO, NVIDIA Corporation | Q4 2022 NVIDIA Corp Earnings Call, Feb 16th, 2022

Learn More About Tonal Sentiment Analysis

Upstart +23% Following Earnings Report After Beating Revenue Expectations and Announcing $400M Buyback

“An economy and market in transition plays to our strength.”

“Like you, we've been eyes wide open, watching all that's happening in the world in the last few months: the rise and fall of the Omicron variant, the clear signs of inflation and the Fed's plan to counter it, and of course, the market rotation out of high-growth technology. But through all of it, our business continues to get stronger and my confidence in Upstart's future has never been greater. As the rare public technology company with triple-digit growth and profits, we're confident that an economy and market in transition plays to our strength… 2021 will be remembered as the year AI levying came to the forefront, kicking off the most impactful transformation of credit in decades.”

  • David J. Girouard, Co-Founder, President, CEO & Chairperson of the Board, Upstart Holdings, Inc. | Q4 2021 Upstart Holdings Inc Earnings Call, Feb 15th, 2022

Economic Volatility Cited as Key Legitimizing Force Behind AI-Enabled Lending

“Our core thesis is that over a period of years, AI lending will rapidly gain market share over legacy approaches to credit and Upstart is in the pole position to benefit from that. In fact, economic volatility, such as we've seen in the last 2 years only serves to demonstrate the value of a modern AI-enabled approach to credit origination.”

  • David J. Girouard, Co-Founder, President, CEO & Chairperson of the Board, Upstart Holdings, Inc. | Q4 2021 Upstart Holdings Inc Earnings Call, Feb 15th, 2022

UPST Expects Accelerated Growth Into Auto Lending, Even as Auto Retailers Continue to Grapple with Supply Chain Headwinds

CEO Girouard Expresses Textual + Tonal Confidence on the Subject: “I think generally, the biggest challenge in auto retail at the moment is the supply chain that car manufacturers and the auto industry overall is seeing, meaning it can be challenging to sell software to a dealership that helps them sell more cars when they don't have enough cars to sell in the first place. But despite that and despite that headwind that we're selling into, as you can see, we are expanding pretty rapidly. So our expectation is we'll see rapid acceleration of that over the year. Certainly, as supply chains sort of repair themselves and inventory levels on car dealerships, et cetera, begin to sort of return to normal, we think that will be a tailwind that will just further accelerate. So we're really pleased with the progress and we think we would expect to continue to accelerate adoption across rooftops through this year.”

  • David J. Girouard, Co-Founder, President, CEO & Chairperson of the Board, Upstart Holdings, Inc. | Q4 2021 Upstart Holdings Inc Earnings Call, Feb 15th, 2022

Learn More About Tonal Sentiment Analysis

Despite Another Record Quarter, CAR Stock Slides as Omicron Hurts Revenue-Per-Day (RPD) and Impacts Seasonal Patterns

CAR Price Reaction During Q4 2021 Earnings Call

“Speaking of RPD, this is the first quarter in over a year where we saw a sequential decline. RPD in the fourth quarter of 2021 was down 10% from the previous quarter, but up 30% versus the same period in 2019… In normal years, December is the month with the highest RPD in the fourth quarter given the peakiness of Christmas. However, in 2021, December represented our lowest RPD in the fourth quarter. We believe the rate should normalize once we move past Omicron and turn to normal seasonal trends.”

  • Joseph Ferraro, CEO & President, Avis Budget Group, Inc. | Q4 2021 Avis Budget Group Inc Earnings Call, Feb 15th, 2022

Airbnb Leading a Fundamental Change in Travel, While Traditional Hotel Groups Focus on Customer Recovery

[Airbnb] People are Traveling - and Still Working Remotely: “Nearly 2 years into the pandemic it's clear that we are undergoing the biggest change in travel since the advent of commercial flying. Remote work has untethered many people from the need to be in an office. And as a result, people are spreading out to thousands of towns and cities, staying for weeks, months or even entire seasons at a time. For the first time ever, millions of people can now live anywhere.”

  • Brian Chesky, Co-Founder, CEO, Head of Community & Chairman of the Board, Airbnb, Inc. | Q4 2021 Airbnb Inc Earnings Call, Feb 15th, 2022

[Airbnb] Average Length-of-Stay Dramatically Increasing: “And finally, guests are not just traveling on Airbnb, they are now living on Airbnb. Nearly half of our nights booked in Q4 were for stays of a week or longer. 1 in 5 nights were for stays of a month or longer. And in the past year alone, nearly 175,000 guests stayed for 3 months or longer.”

  • Brian Chesky, Co-Founder, CEO, Head of Community & Chairman of the Board, Airbnb, Inc. | Q4 2021 Airbnb Inc Earnings Call, Feb 15th, 2022

Meanwhile, Hotel Groups are Focusing on Leisure, Group Bookings, and Business Transient

Wyndham Seeing (and Expecting) Longer Stays from Essential Workers and Infrastructure Bill Beneficiaries: “Average length of stay continues to surpass 2019 levels… I mean we know that there are over 10 million construction workers out there that travel every week. And we also know that relocation and long-term assignments are going to continue to pick up. We're going to see, we feel, millions of more essential workers hitting the road with the coming Infrastructure Bill and keeping that industry-wide extended stay average daily rate occupancy up in the high 70s and 80% range.”

  • Geoffrey A. Ballotti, President, CEO & Director, Wyndham Hotels & Resorts, Inc. | Q4 2021 Wyndham Hotels & Resorts Inc Earnings Call, Feb 16th, 2022

Marriott Attempts to Differentiate from Airbnb, Focus on Amenities: “I think if you look particularly at the performance we've seen in our luxury tier resorts and our full-service resorts, one of the things we hear from our customers pretty clearly is their desire for a full complement of services and amenities. And as we've said in the past, that's probably the most significant differentiator between our product offering and some of the short-term rental offerings that are out there.”

  • Anthony G. Capuano, CEO & Director, Marriott International, Inc. | Q4 2021 Marriott International Inc Earnings Call, Feb 15th, 2022

Marriott Seeing Reduced Desire for Isolated Vacations, Narrowing Airbnb Customer Gap: “The other thing I'll mention is clearly in the beginning of the pandemic when you were kind of imagining searches for people wanting to get away, there was a larger proportion of searches that were for places that are out of the way, truly places where people felt comfortable going where they could be away from others. And we have seen that gap narrow in terms of the searches for classic room-sharing type places as well as hotels. We've seen that gap narrow, which I think makes sense given the progress as we move through the pandemic.”

  • Kathleen Kelly Oberg, CFO & Executive VP, Marriott International, Inc. | Q4 2021 Marriott International Inc Earnings Call, Feb 15th, 2022

Hilton Remains Focused on Rebound of Core Customer Segments: “Despite some near-term choppiness, we remain optimistic about accelerated recovery across all segments throughout 2022. We anticipate strong leisure trends to continue again this year, driven by pent-up demand and nearly $2.5 trillion of excess consumer savings… Similarly, we expect more flexible travel policies across large corporate customers to fuel increasing business transient trends… On the group side, our position for the year is to remain steady as Omicron-related disruption was largely contained to the first quarter of 2022 with most events rescheduled for later in the year. We continue to expect meaningful acceleration in group business in the back half of the year as underlying group demand remains strong.”

  • Christopher J. Nassetta, President, CEO & Director, Hilton Worldwide Holdings Inc. | Q4 2021 Hilton Worldwide Holdings Inc Earnings Call, Feb 16th, 2022

Hyatt Talks Pent Up Leisure Demand, President’s Day Travel Trends: “I’ll give you a real time data point as we sit here right now, President Day weekend, which is just ahead of us, up double digits relative to 2019 in our legacy Hyatt portfolio. So I would just tell you that Omicron considerations have dissipated as quickly as they rose at the inception. And we keep talking about this term pent-up demand. It's just an enduring level of people who really feel compelled to get out, to engage, to connect. And we're seeing it come up data point after data point after data point. So that's just -- I know it's one fact and an anecdotal one at that, but it is real time.”

  • Mark Samuel Hoplamazian, President, CEO & Director, Hyatt Hotels Corporation | Q4 2021 Hyatt Hotels Corp Earnings Call, Feb 17th, 2022

Related: Airline Bookings YoY for President’s Day Weekend (U.S. Origin). Current Percentage of Reservations Compared to Years Prior (Source: Tripit)

Digital Transformation Continues for All Types of Restaurants - Quick Service, Fast Casual, and Sit Down

Toast CEO on Digital Transformation: “What we have learned in our history serving the industry is that restaurant operators are incredibly resilient. Even before COVID-19, the industry was transforming. Dining itself was changing from mobile order and pay at the table to delivery and online ordering. The pandemic accelerated these changes. When looking at the performance of restaurants on the Toast platform, we have been impressed by their ability to take full advantage of the platform's capabilities to reinvent their business and navigate the impact of COVID-19.”

  • Christopher P. Comparato, CEO & Director, Toast, Inc. | Q4 2021 Toast Inc Earnings Call, Feb 15th, 2022

Restaurant Brands International (Parent Company to Burger King, Popeyes, and Tim Horton’s): “And a quick update on our digital sales progress. We ended 2021 with over $10 billion in global digital sales, representing just over 30% of our total system-wide sales. Tremendous progress from just over 4 years ago when we had virtually no digital sales in most of our major markets.”

  • Joshua Kobza, COO of Restaurant Brands International Inc. | Q4 2021 Restaurant Brands International Inc Earnings Call, Feb 15th, 2022

Shake Shack: “In the fourth quarter, we grew our first-time web and app customer base by nearly 10% versus the prior quarter and by more than 80% for the full year 2021 as we leaned into more personalized and digital marketing as well as launching key limited time offers through our own app channels. Our digital retention remains strong. In December, we retained nearly 80% of the digital business that we had generated in January 2021, even as our in-Shack sales nearly doubled. Our digital sales mix was 42% in the quarter and nearly 60% when considering kiosks and our digital channels combined. The long-term and sustainable growth of our digital business is top of mind in our 2022 G&A guidance and overall investment plan. We believe our initiatives are important to lay the groundwork for improved digital frequency and lifetime value of these guests.”

  • Katherine Irene Fogertey, CFO, Shake Shack Inc. | Q4 2021 Shake Shack Inc Earnings Call, Feb 17th, 2022

Related: Shake Shack Launches New Black Truffle Burger & Fries, Available Only via the Shack App | Yahoo News

Cheesecake Factory: “As I shared previously, with the strength of our sales performance, we have shifted our marketing for The Cheesecake Factory profile of The Cheesecake Factory brand, while continuing to upgrade and enhance our marketing and technology platforms. [We] refreshed [our] website just 2 weeks ago along with a more contemporary look - the more commerce forward platform delivers a better guest experience with the goal of driving higher conversion rates and average order values for online ordering.

  • David M. Gordon, President, The Cheesecake Factory Incorporated | Q4 2021 Cheesecake Factory Inc Earnings Call, Feb 16th, 2022

Chuy’s: “Other digital marketing initiatives include an organic influencer program on Instagram, YouTube video advertising, promotional advertising partnership with DoorDash, and a launch of our new website later this year, all of which are designed to reach a broader audience group and allow us to better connect with the new and returning guests.”

  • Steven J. Hislop, Chairman, CEO & President, Chuy's Holdings, Inc. | Q4 2021 Chuy's Holdings Inc Earnings Call, Feb 17th, 2022

DoorDash Comments on Reopening Restaurants: “What happens to demand as diners go back and eat inside restaurants? Well, I think clearly, takeout and delivery, as shown by our performance, not just in the fourth quarter but also in 2021, [shows] that they're complementary. It's very possible to eat inside of a restaurant and get delivery because we eat 3 times or more maybe per day, and that's over 100 shopping moments per month.

  • Tony Xu, Co-Founder, CEO & Chair, DoorDash, Inc. | Q4 2021 DoorDash Inc Earnings Call, Feb 16th, 2022