The Connected Economy 100 (CE100) Index lost 5.4% on the week, far outstripping the 2.2% loss in the Nasdaq and the roughly 1.1% decline in the broader S&P 500.
CE100 Relative Performance
All pillars fell, with the shopping segment standing out as the worst performer, down more than 8% on the week. That decline was followed closely by the “Work” pillar, which lost 6.7%.
Drilling down into those segments, double-digit declines on a name-by-name basis were the norm. Macro concerns continue to dominate, particularly amid the platforms that are focused on bringing merchants and consumers together. Spending is being buffeted by inflation, of course.
Within the “Shop” vertical, the leaders to the downside were Shopify (down 16.0%), MercadoLibre (off 15.9%), and Vroom (sliding 13.2%).
Shopify’s slide continued in the wake of news earlier this month that merchant growth on the platform has been slowing. Shopify added 71,000 net merchants in the first half of the year, according to YipitData research. The company added 680,000 at the peak height of the pandemic in 2020 and 314,000 last year.
MercadoLibre’s losses came as the company said this past week that it had launched the MercadoCoin. The digital offering will be free-floating, with an initial price of $0.10.
MercadoCoin won’t be sold directly, but instead earned via the company’s loyalty program — and, at present, only in Brazil, where it will roll out to the firm’s 80 million-strong customer base by the end of the month.
Vroom continued to give up any gains seen earlier in the month, as its quarterly results showed a 45% drop in eCommerce revenues and the number of vehicles sold in the quarter dropped by nearly 50%.
Walmart was one of the few gainers in this segment, where the retailing giant gathered 3.6% on the week — which was among the best returns of any individual names in the CE100. As noted in this space in recent days, DoorDash and Walmart are severing their on-demand grocery delivery partnership, which had been in place since 2018.
The “Work” pillar was dragged down by WeWork, which lost 21%, showing some volatility on the heels of results in August that showed that memberships were up 33% and the company’s occupancy rate for its flexible work spaces was up to 72%, echoing pre-pandemic levels.
Moving beyond the individual pillar performances, Porch sank 22%, followed by Affirm’s 21% loss. As had been profiled this week in The Wall Street Journal and recounted here, while the stock has plummeted by as much as 75% in just the past few months, Affirm founder Max Levchin is confident that underwriting activity will surpass that of many banks.
“I can swear on a stack of Bibles or your preferred book of choice, until we get through a full recession, I will get partial credit when I show the numbers that I said I will,” Levchin said, per the Journal report. “But once we’re back in a rapidly expanding economy and we’re still here, still lending money, still controlling our delinquencies, I think I’ll get full recognition.”
Separately, Roblox shares, as part of the “Have Fun” pillar, which slipped 5.5% through the past five sessions, dived 16.6%. Reporting second quarter earnings earlier in the month, Roblox founder and CEO David Baszucki told analysts that the number of users over 13 years old rose 30% year over year.
The latest quarterly revenue, at $591.2 million, was up 30% year over year. However, average bookings per DAU (ABPDAU) was $12.25 in the quarter, down 21% year over year.