Americas Technology - Internet - Q3'22 EPS Review - Where To From Here - Recapping Takeaways & Debates Top Picks Going Forward

18 November 2022 | 12:03AM EST
Americas Technology: Internet
Q3’22 EPS Review: Where To From Here?– Recapping

Takeaways & Debates; Top Picks Going Forward
This past earnings season will be remembered as one of the most volatile in the 20+ Eric Sheridan
+1(917)343-8683 | eric.sheridan@gs.com
years of the sector as many large/mega cap companies moved in 10-20% Goldman Sachs & Co. LLC
increments on the back of mixed narratives around a) the broader macroeconomic Alexandra Steiger
+49(69)7532-3097 |
environment, and b) idiosyncratic decisions by company mgmt. teams to align alexandra.steiger@gs.com
Goldman Sachs Bank Europe SE
investments (incl. headcount, capex, product development etc.) against a slower,
Ben Miller
more mature revenue growth profile. In the case of both Amazon and Meta +1(917)343-8674 |
For the exclusive use of JONATHAN.SU@CELADONPARTNERS.COM
benjamin.miller@gs.com
Platforms: narratives around investment and margin dynamics were reversed a few Goldman Sachs & Co. LLC
weeks later by subsequent company announcements on workforce reductions. With Lane Czura
+1(917)343-8682 | lane.czura@gs.com
Goldman Sachs & Co. LLC
the vast majority of the US Internet sector tied to broad global consumer habits,
investors continue to focus their attention on scaled players with a proven track Alex Vegliante, CFA
+1(212)934-1878 |
alex.vegliante@gs.com
record and that can either be valued on GAAP earnings or free cash flow and/or have Goldman Sachs & Co. LLC
favorable profit narratives driven by a mix of scaling structural advantages and/or Pierre Riopel
+1(212)934-4505 | pierre.riopel@gs.com
mgmt. focus on balancing investments needs and revenue growth for a more Goldman Sachs & Co. LLC
normalized 2023 landscape. In terms of risk factors, we would highlight: 1) Sarah Boulos
+1(212)357-0476 | sarah.boulos@gs.com
continued monitoring of enterprise and consumer spending trends for any rate of Goldman Sachs & Co. LLC
change that would put forward operating estimates under pressure; 2) regulatory Sanchit Chandna
+1(332)245-7674 |
scrutiny as an impact on P&L and as a continued headwind to inorganic growth via sanchit.chandna@gs.com
Goldman Sachs India SPL
M&A for largest names in the sector; & 3) rising competitive intensity in some
verticals (most notably digital advertising) at a time when revenue growth is already
impaired by post-pandemic maturity, macro headwinds and industry privacy
abf1713081cf4bd28921692cb124a462
changes. In our investor conversations over the past 4-6 weeks, many investors
continue to see a high probability of a regional/global consumer recession between
2H ’22 and 1H ’23 and thus remain in a much more defensive than offensive
mentality with respect to the sector.
Sub-Sector Takeaways: Mixture of Slowdowns Emerge While Some Consumer

Facing Sub-Sectors Surprise To Upside
With respect to digital advertising, the broadest takeaway from earnings season is
that the industry has begun to demonstrate a broader slowdown with a mixture of
macroeconomic headwinds, increased competition, relative industry maturation &
Apple privacy changes. Looking forward, we see the potential for the digital ad
environment to continue to slow alongside any downward macroeconomic activity in
Goldman Sachs does and seeks to do business with companies covered in its research reports. As a result,
investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this
report. Investors should consider this report as only a single factor in making their investment decision. For Reg AC
certification and other important disclosures, see the Disclosure Appendix, or go to
www.gs.com/research/hedge.html. Analysts employed by non-US affiliates are not registered/qualified as research
analysts with FINRA in the U.S.
Goldman Sachs Americas Technology: Internet
1H 2023 but remains an industry that should resume solid growth (in the high single/low
double digits range) in a more normalized environment. Looking forward, we note a few
themes from early Q4 advertising industry checks: 1) visibility into the forward operating
environment remains low (especially with respect to 2023 budget planning); 2)
competitive intensity for user time/engagement remains high but stable – in short-form
video specifically, Reels (META) and YouTube Shorts (GOOGL) seem to have responded
to rising competitive intensity on both the product and potential monetization
opportunity; 3) new mediums (short-form video, ad supported streaming platforms &
merchant media efforts) could amplify competitive intensity in 2H’22 and 2023 as many
industry players compete for ad budgets in an uncertain backdrop & 4) CMO/ad agency
conversations point to a stable environment in US as consumer behavior remains more
resilient vs. initial expectations ahead of the holiday season across a number of verticals
but weakness continues to build in the broader European region.
With regards to eCommerce, we would highlight 1) the more resilient operating

performance of scaled players, as consumers consolidated more of their spend towards

aggregators and as merchants found increasing value in the large platforms’ pools of
organic traffic and high-attribution bottom-of-funnel advertising solutions; 2) the
continued divergence in spending trends between the lower-end and higher-end
consumers, 3) a clear message from companies that the European consumer was a
source of weakness in terms of both September quarter exit velocity and early read on
October activity levels; & 4) sharper focus from unprofitable platforms to provide a
near-term path towards Adj. EBITDA breakeven, often through extensive cost
rationalization exercises and curtailing of non-core growth initiatives. On this last point,
the key eCommerce narrative for Amazon shares to recover/outperform remains line of
sigh into improved North America eCommerce margins (with any visibility into return
levels last seen pre-pandemic in 2018/2019) and increased disclosure about regional
impacts and long-term trajectory for International losses (the latter being a low visibility
point for many investors). A common thread across AMZN’s AWS and GOOGL’s Google
abf1713081cf4bd28921692cb124a462
Cloud was enterprise customers looking to optimize spend into an uncertain macro
backdrop (which we think could result in a multi-quarter slowdown in reported growth
before returning to normal as backlog trends remained healthy in the quarter) & higher
energy prices placing some pressure on margins. While we acknowledge that economic
conditions will likely produce slower than normal growth and margins in the coming
quarters, we are unchanged in our long-term view of the potential for cloud computing
(as evidenced by Amazon’s $104bn revenue backlog that grew +57% YoY).
Both the online travel sector & local commerce/food delivery sub-sectors remained
areas where short-term trends remain elevated (especially tied to the US consumer) and
forward mgmt commentary for stability in behavior into October and through the
December quarter ran counter narrative from investor fears/perception heading into
earnings season. Looking beyond the next few months, there remains a healthy investor
debate on demand trends (both units and pricing) in many of these consumer facing
sub-sectors if the consumer behavior were to soften throughout 1H 2023 and hence the
bar for incremental investor interest remains low on line of sight. Within the online travel
sector, debates center around: 1) hybrid work/life vs. return to office post-Summer ‘22;
2) room night growth & ADR tailwinds which could moderate going forward from mix
18 November 2022 2
and/or weakening consumer demand; & 3) continued industry efforts to optimize

marketing channels for more direct traffic. While still tied to consumer consumption at
its core, we are increasingly of a view that ridesharing platforms (with rider bases still
below pre-pandemic levels and some regions, especially the US West Coast, well below
pre-pandemic levels) have room to grow their utility as consumer travel, return to office
and resumption of normative mobility remain tailwinds at the same time rider/driver
incentives (as a pressure on margins) continue to abate.
In streaming media, the launch of Netflix’s ad supported tier and the global crackdown
on password sharing has driven increased investor interest (& with it strong recent stock
outperformance) but we remain skeptical that any new normal has emerged as we
continue to see broad based industry maturation & rising competitive intensity but
acknowledge the narrative is unlikely to be proved/disproved in the short term. We sit on
the sidelines for both Peloton (visibility into renewed growth & turnaround strategy
needed) and Spotify (with debates centered around visibility into long term gross margin
expansion and diversified audio product initiatives). With regards to gaming

(PC/console/mobile), we saw a few key themes arise: 1) softness in mobile gaming,
citing continued IDFA headwinds as well as broader macro environment; 2) premium
annual unit sales demonstrated strength offsetting mobile weakness; 3) in-game
monetization across the board trended lower (albeit rate of consumption/engagement
remains relatively healthy); & 4) less robust holiday slate given game delays against the
backdrop of supply constraints starting to ease for the next gen of consoles. That being
said, as we turn the calendar to 2023, we are increasingly positive on this sub-sector (&
recently upgraded TTWO to Buy on our long-term industry thesis – link) based on a
mixture of an improved console cycle, a robust industry wide content cycle and
improvement in mobile gaming trends as IDFA and pandemic headwinds are broadly
absorbed and lapped in company operations. Online Dating had another quarter of solid
user growth however forward commentary – both Q4 and initial 2023 guidance —
largely disappointed as BMBL and MTCH continued to face a mix of micro (delay in
abf1713081cf4bd28921692cb124a462
product initiatives/launches) and macro headwinds (esp. on a-la-carte & among the more
economically sensitive user base) with investor focus now shifting to 2023 key product
launches, rate of change in macro trends and pace of international expansion (Bumble &
Hinge).
Framing Risk/Reward - Top Picks Focused On Large Caps That Can Weather Volatile
Environment
Looking at our stock coverage’s risk/reward skew exiting Q3 earnings, we see the most
compelling risk/reward setups in the group among a collection of large cap names with
a mixture of traits incl. large/scaled end market positioning, ability to manage for
improved margin trajectory (in various economic outcomes) and lingering investor
debates that create a “wall of worry” that can be measured between the Q4 based
2022 exit velocity and into 2023. Specifically, we highlight: 1) eCommerce - AMZN
(remains our top pick for 2022) with debates focused on the potential slowdown in AWS
(which we tackled in our recent cloud preview – link), the level of conservatism baked in
to Q4 revenue guide and the scope of a potential recovery in eCommerce margins.
ETSY which has proven the relative resilience of their business model (solid user growth
18 November 2022 3
& retention dynamics in Q3 and better Q4 GMS guide) amidst a challenging macro
environment as the platform differentiates through product and value; 2) UBER – For
third quarter in a row, produced progress on profit initiatives with stable end demand
trends & overall industry competitive intensity; 3) Digital Advertising/Internet Services –
We remain Buy rated on META & GOOGL and think the downside case of a potential
range of outcomes for a 1H 2023 recession are increasingly reflected in the current
share prices. As investor pushback on levels of investment and forward margin
dynamics, both companies need a mixture of digital ad recovery line of sight mixed with
margin stability to recover from current share price levels. In addition, we would
highlight the positive risk/reward skew of PINS, EXPE, LYFT, TTWO & IAC among a wider
array of our Buy rated stocks.
Risk/Reward Matrix & RSI

Exhibit 1: Risk/Reward Matrix - Large Cap
9
LYFT
6
APP
Upside/Downside Skew
EXPE
5
GOOGL AMZN
abf1713081cf4bd28921692cb124a462
UBER
3
SPOT TTWO
DASH
BKNG
2 MTCH META
ABNB PINS
ETSY
EBAY
1
-60% -40% -20% 0% 20% 40% 60% 80% 100% 120% 140%
EA
RBLX SNAP
0
NFLX % Upside/Downside to PT
As of 11/16/2022
Source: FactSet, Company data, Goldman Sachs Global Investment Research
18 November 2022 4
Exhibit 2: Risk/Reward Matrix - SMID Cap
16
14 IAC
TDUP
12
VCSA
Upside/Downside Skew
10
ANGI
UBI-FR DUOL
6
GDRX UPWK
4
NRDY ZIP
YELP XMTR ACVA
ROVR KIND PLTK
FTDR 2 BMBL
W SCPL
DV
-50% GRPN 0% PTON 50% 100% 150% 200%
CHGG FVRR0 % Upside/Downside to PT
COUR
As of 11/16/2022
Exhibit 3: RSI Across our Large Cap Coverage (Trailing 30 days) Exhibit 4: RSI Across our SMID Cap Coverage (Trailing 30 days)
70 80
60 70
abf1713081cf4bd28921692cb124a462
Average = 50.5 60
50
Average = 50.5
50
40
40
30
30
20
20
10
10
0 0
TDUP
DUOL
UPWK
CHGG
ROVR
GRPN
ACVA
YELP
ZIP
W
PTON
COUR
ANGI
IAC
XMTR
UBI
KIND
PLTK
DV
NRDY
BMBL
FVRR
GDRX
VCSA
FTDR
SCPL
Lookback as of 11/16/2022 Lookback as of 11/16/2022
Source: FactSet Source: FactSet
18 November 2022 5
Key Debates & Our View

Exhibit 5: Key Debates & Our View - Digital Advertising
Digital Advertising
Company Ticker Rating 12 mo. PT Key Debate: Our Take:
Alphabet's Q3 '22 earnings report revolved around a few key themes: 1) Search revenue tracked inline with our estimate as the company called out a mix of performance of certain industry verticals in Q3 in addition to
continued impact from tough YoY comps; 2) YouTube revenue continued to face headwinds from a mix of ad budget pullback, tough YoY comps and newer headwinds from lower-monetized formats incl. Shorts & connected
How will a mix of near-term headwinds (macro, tough
TV (though the company expressed optimism for tailwinds in forward periods as YouTube Shorts monetization increases and the connected TV opportunity continues to scale); & 3) Cloud revenue continues to grow at solid
comps, investments) & longer-term tailwinds
YoY rates and remains a key area of focus for the company against the long-term opportunity. In our view, a mixture of investments toward long-term growth opportunities, shareholder returns (via buybacks) and increasing
Alphabet GOOGL Buy $ 135 (exposure to industry secular growth themes) translate
operating efficiencies are likely going to be the key driver of share price performance in the years ahead. In particular, the trajectory for Google Services operating margins in 2023 & beyond (driven by the inputs laid out by
into revenue growth & margin expansion in 2023 &
management) will likely be critical to understand the compounded returns for GOOGL shares. While the macroeconomic conditions will likely impact the short term narratives, we remain constructive on the opportunity for
beyond?
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behavior increasingly shifts toward that use case).
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around Reels/short-form video) & the lapping impact of the prior 12+ months of headwinds from Apple's privacy changes. Taken alone, the narrative around advertising trends would have left investors with an upside
returns over the next 2+ years and how will a mix of
surprise relative to both expectations and recent earnings reports with management's commentary pointing to a potential ~DD% revenue growth in 2022 in a more stable macro environment in 2022. On the other hand,
continued headwinds (macro, IDFA/data privacy,
Meta opex/capex in 2022 remains elevated with management providing initial 2023 opex/capex guidance well above expectations. Despite these investments going toward a range of initiatives in support of AI, knowledge
META Buy $ 165 competition, shift to short-form video) and tailwinds
Platforms graph/recommendation engine, ad platform automation measurement/attribution and overall data center infrastructure, this level of investment puts a material downward node on profitability and FCF generation in 2023.
(Reels monetization, easier comps, mitigating privacy
While management framed the potential for out-year margin stability and capex intensity to lessen, the mixture of low visibility into such trends against investor fears of the current macro environment, competition, and
headwinds, etc.) translate into medium-term topline
ŽǀĞƌĂůůƐĞŶƐŝƚŝǀŝƚǇƚŽ'WƉƌŽĨŝƚĂďŝůŝƚǇͲĚƌŝǀĞŶǀĂůƵĂƚŝŽŶĂƉƉƌŽĂĐŚĞƐŶŽǁůŝŬĞůǇŵĂŬĞƐDdĂ͞ƐŚŽǁŵĞƐƚŽƌǇ͟ĨŽƌŝŶǀĞƐƚŽƌƐŽŶĂϭϮͲϭϴŵŽŶƚŚǀŝĞǁ͘DdΖƐϮϬϮϯƌĞǀĞŶƵĞƚƌĂũĞĐƚŽƌǇĂŶĚŽƵƚͲǇĞĂƌŵĂƌŐŝŶŝŵƉƌŽǀĞŵĞŶƚƐďŽƚŚ
growth?
provide an eventual means to test returns on this investment surge in 2022/2023.
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Can Angi execute against home services market
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opportunity following period of investment? Can
IAC IAC Buy $ 87 capital toward both its own stock and the potential for M&A opportunities. Based on the above thematic elements, we were not surprised that ANGI rallied off mgmt comments and IAC shares were slightly weaker. We
Dotdash successfully integrate recently acquired
remain focused on a few key long-term variables: IAC remains a collection of compelling consumer internet businesses trading at a discount to NAV and with sustained long-term growth opportunities and attractive
Meredith and create shareholder value?
structural margin profiles as we look out over the next few years. Specifically, taking IAC's current market cap & backing out the market value of their stakes in ANGI & MGM implies an enterprise value of ~$977mm for
Dotdash Meredith, Search, businesses within their Emerging segment & their stake in Turo. In addition, IAC management has a proven track record of creating value for shareholders by unlocking value in individual assets
through operating expertise & financial acumen.
WŝŶƚĞƌĞƐƚΖƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚǁĂƐďƌŽĂĚůǇƉŽƐŝƚŝǀĞŝŶŽƵƌǀŝĞǁ͕ƉĂƌƚŝĐƵůĂƌůǇĂŵŝĚƐƚĂǀŽůĂƚŝůĞŽǀĞƌĂůůĂĚǀĞƌƚŝƐŝŶŐĞŶǀŝƌŽŶŵĞŶƚʹƵƐĞƌŐƌŽǁƚŚƐŚŽǁĞĚƉŽƐŝƚŝǀĞƐŝŐŶƐŽĨƐƚĂďŝůŝǌĂƚŝŽŶͬƌĞĂĐĐĞůĞƌĂƚŝŽŶǁŝƚŚĞŶŐĂŐĞŵĞŶƚƚƌĞŶĚƐ
Will PINS sustain recent stabilized user
ƌĞŵĂŝŶŝŶŐƐƚƌŽŶŐ͕ǁŚŝůĞƌĞǀĞŶƵĞŐƌŽǁƚŚŽƵƚƉĞƌĨŽƌŵĞĚĨĞĂƌƐĂƐĚĞŵĂŶĚ;ĞƐƉ͘ǁŝƚŚŝŶWŝŶƚĞƌĞƐƚ͛ƐŬĞǇǀĞƌƚŝĐĂůƐĞ͘Ő͘ƌĞƚĂŝů͕ĞŽŵŵΘW'ͿƐŚŽǁĞĚƐŝŐŶƐŽĨƌĞƐŝůŝĞŶĐĞ͘ůŝŐŶĞĚǁŝƚŚŽƵƌƌĞĐĞŶƚƵƉŐƌĂĚĞƌĞƉŽƌƚ͕WŝŶƚĞƌĞƐƚ
growth/engagement trends post-COVID and can
management indicated signs of making solid progress toward key long-term revenue growth initiatives (shopping/commerce, depth of engagement across media types, international monetization, etc.) that, coupled with a
Pinterest PINS Buy $ 31 management execute against future monetization
ƉŽƐŝƚŝǀĞƵƐĞƌŐƌŽǁƚŚŶĂƌƌĂƚŝǀĞ͕ƐĞƚƐƵƉƚŚĞƉůĂƚĨŽƌŵĨŽƌƐƵƐƚĂŝŶĞĚĂďŽǀĞͲŝŶĚƵƐƚƌǇĂǀĞƌĂŐĞƌĞǀĞŶƵĞŐƌŽǁƚŚŽǀĞƌƚŚĞŶĞǆƚϮͲϯǇĞĂƌƐŝŶŽƵƌǀŝĞǁ͘ƚƚŚĞƐĂŵĞƚŝŵĞ͕ǁĞǀŝĞǁŵĂŶĂŐĞŵĞŶƚ͛ƐĐŽŶƚŝŶƵĞĚĨŽĐƵƐŽŶƌĞƉƌŝŽƌŝƚŝǌŝŶŐ
opportunities (including shopping/commerce) while
ŝŶǀĞƐƚŵĞŶƚƐĂƐĂƉŽƐŝƚŝǀĞĨŽƌĨƵƚƵƌĞŵĂƌŐŝŶĞǆƉĂŶƐŝŽŶĂŶĚůŽŶŐͲƚĞƌŵƉƌŽĨŝƚĂďŝůŝƚǇ͘tŚŝůĞƐŽŵĞƋƵĞƐƚŝŽŶƐǁŝůůůŝŬĞůǇƌĞŵĂŝŶĂƌŽƵŶĚŵĂŶĂŐĞŵĞŶƚ͛ƐYϰŽƵƚůŽŽŬ;ǁŝƚŚŽǀĞƌĂůůŐƵŝĚĂŶĐĞΕŝŶůŝŶĞǁŝƚŚĞǆƉĞĐƚĂƚŝŽŶƐďƵƚƐŽŵĞ
balancing investments with margin expansion?
commentary of QTD trends tracking at low end of range), we view this earnings report as a step toward realigning investor focus toward the medium-to-long-term opportunities in 2023 & beyond.
^ŶĂƉΖƐYϯ͚ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚǁĂƐďƌŽĂĚůǇŶĞŐĂƚŝǀĞŽŶĂŵŝǆƚƵƌĞŽĨĚŝƐĂƉƉŽŝŶƚŝŶŐƌĞǀĞŶƵĞƚƌĞŶĚƐ;ďŽƚŚŝŶƚŚĞƌĞƉŽƌƚĞĚƋƵĂƌƚĞƌĂŶĚƚŚĞĨŽƌǁĂƌĚYϰƌĞǀĞŶƵĞĐŽŵŵĞŶƚĂƌǇͿĚƌŝǀĞŶďǇĐŽŶƚŝŶƵĞĚŵĂĐƌŽŚĞĂĚǁŝŶĚƐ;ďƵĚŐĞƚ
ĚĞĐŝƐŝŽŶƐĂŶĚďƌĂŶĚŵŝǆĐƌĞĂƚŝŶŐǀŽůĂƚŝůŝƚǇͿĚĞƐƉŝƚĞƚŚĞĐŽŵƉĂŶǇ͛ƐŵŽƌĞƉŽƐŝƚŝǀĞĐŽŵŵĞŶƚĂƌǇŝŶůĂƚĞƵŐƵƐƚ͘ĂƐĞĚŽŶŽƵƌƌĞĐĞŶƚĂĚŝŶĚƵƐƚƌǇĐŽŶǀĞƌƐĂƚŝŽŶƐ͕ŽƵƌǀŝĞǁƌĞŵĂŝŶƐƚŚĂƚƚŚĞƐĞŚĞĂĚǁŝŶĚƐĂƌĞĂŵŝǆƚƵƌĞŽĨƌĞůĂƚŝǀĞ
Can Snap mitigate recent headwinds (macro, IDFA/data
industry positioning, competition dynamics, continued platform-specific headwinds around ATT/IDFA and with targeting/measurement specifically and less robust ad auction density as opposed to being a direct read-
privacy, competition) and execute against restructuring
Snap SNAP Neutral $ 10 through of a broad-based ad recession. In addition, SNAP remains a platform in transition from its past with messaging at its core utility to its identified future around augmented reality based utility and media consumption
efforts to drive meaningful topline growth & margin
(with those dynamics creating additional medium term monetization headwinds). Looking forward, we expect Snap as a stock to be range bound for the short/medium term (after this negative after hours reaction which
expansion in the coming years?
resets the stock back to the levels seen after its Q2 earnings disappointment) as investors digest a new normal of depressed revenue growth (with low line of sight into above industry growth), a potentially better long term
margin structure (on the back of efficiency plans) and an equity value that likely needs to digest that dynamic in an environment where investors are prioritizing stocks that are more easily valued on GAAP profitability.
/ŶŝƚƐYϯΖϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕EĞǆƚĚŽŽƌ;</EͿŵĂŶĂŐĞŵĞŶƚƐƚƌƵĐŬĂŶƵŵďĞƌŽĨŬĞǇƚŚĞŵĞƐ͗ϭͿƚŚĞĐŽŵƉĂŶǇƐĂǁŵŝǆĞĚƌĞǀĞŶƵĞƉĞƌĨŽƌŵĂŶĐĞĚĞƉĞŶĚŝŶŐŽŶĂĚǀĞƌƚŝƐĞƌǀĞƌƚŝĐĂů;ƐƚƌĞŶŐƚŚĨƌŽŵŐŽǀ͛ƚΘŚĞĂůƚŚĐĂƌĞ͖ǁĞĂŬŶĞƐƐ
from financials, real estate & home services) and size as the broader macroeconomic volatility impacted the digital advertising environment in Q3 and played a role in the company lowering its FY 2022 forecast; 2) the
Can KIND continue to grow revenues & improve
ĐŽŵƉĂŶǇƐƚŝůůƌĞŵĂŝŶƐŝŶŝŶǀĞƐƚŵĞŶƚŵŽĚĞĂŐĂŝŶƐƚůŽŶŐƚĞƌŵŽƉƉŽƌƚƵŶŝƚŝĞƐ;ůŽĐĂůĐŽŶŶĞĐƚŝǀŝƚǇĂŶĚƐŽĐŝĂůĐŽŵŵĞƌĐĞ͕ĂĚƚĞĐŚͬŵĞĂƐƵƌĞŵĞŶƚ͕ĞƚĐ͘ͿĂŶĚŝƐƐƚƌŝŬŝŶŐĂďĂůĂŶĐĞŽŶŝŶǀĞƐƚŵĞŶƚƐĂŐĂŝŶƐƚĂǁĞĂŬĞƌƌĞǀĞŶƵĞŽƵƚůŽŽŬʹ
abf1713081cf4bd28921692cb124a462
margins through product & ad platform improvements
Nextdoor KIND Neutral $ 2.75 ŶĞǆƚƐƚĞƉǁŝůůďĞĂŶǇďĂůĂŶĐŝŶŐŽĨŝŶǀĞƐƚŵĞŶƚƐŝŶƚŽĂŵĂƌŐŝŶƚƌĂũĞĐƚŽƌǇŝŶƚŽ͛Ϯϯ;ĂĐŽŵŵŽŶƚŚĞŵĞŝŶǀĞƐƚŽƌƐŝŶƚŚĞƐĞĐƚŽƌŬĞĞƉƌĞƚƵƌŶŝŶŐƚŽͿ͖ΘϯͿƚŚĞĐŽŵƉĂŶǇĐŽŶƚŝŶƵĞƐƚŽƐĞĞŽǀĞƌĂůůƐŽůŝĚƵƐĞƌŐƌŽǁƚŚĂŶĚĞŶŐĂŐĞŵĞŶƚ
in light of a current volatile macro environment within
trends with a sizeable under-monetized international base of users. Shorter-term, we see investors remaining focused on a mixture of advertising revenue volatility & a path to improved profitability. Looking long term, we
digital advertising?
see KIND as having a long runway to grow its user base and increase monetization (from relatively low levels currently), with management maintaining a healthy investment cadence (primarily within S&M and R&D) against
this longer-term opportunity.
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕ǁĞĨŽƵŶĚz>WĨŽĐƵƐŝŶŐŽŶĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿĂĚǀĞƌƚŝƐĞƌĚĞŵĂŶĚƌĞŵĂŝŶĞĚƐŽůŝĚŝŶYϯĚĞƐƉŝƚĞƚŚĞŐƌŽǁŝŶŐǀŽůĂƚŝůŝƚǇŝŶƚŚĞŵĂĐƌŽĞĐŽŶŽŵŝĐĞŶǀŝƌŽŶŵĞŶƚǁŝƚŚƉĂƌƚŝĐƵůĂƌƐƚƌĞŶŐƚŚǁŝƚŚŝŶŚŽŵĞ
How will a mixture of tailwinds (local ad recovery, shift
services and restaurants; 2) management continues to execute on its overall costs restructuring with progress made that pushed YELP toward the high end of its guided Adj EBITDA range; & 3) management remains focused
to multi-location & self-serve model, etc.) and
on both consumer facing and advertiser product initiatives into 2023 with optimism around the runway for the advertising opportunity. In the coming quarters, we think investors will remain focused on the exit velocity of
Yelp YELP Neutral $ 35 headwinds (rising competition, uncertain ad macro
2022 (especially as a run-rate for 2023) around the macroeconomic environment & how the competitive landscape for local advertising spend might evolve. Balancing these two time frames and set of debates, we still see
environment) translate into revenue growth & margin
ƚŚĞƌŝƐŬͬƌĞǁĂƌĚĂƐďĂůĂŶĐĞĚŽŶƐŚĂƌĞƐĨƌŽŵĐƵƌƌĞŶƚůĞǀĞůƐ͘>ŽŽŬŝŶŐůŽŶŐͲƚĞƌŵ͕ǁĞĂƌĞŽǀĞƌĂůůĐŽŶƐƚƌƵĐƚŝǀĞŽŶzĞůƉ͛ƐĂďŝůŝƚǇƚŽĐŽŶƚŝŶƵĞƚŽŐƌŽǁƉĂŝĚĂĚǀĞƌƚŝƐŝŶŐůŽĐĂƚŝŽŶƐ;W>ƐͿĂŶĚĐĂƉƚƵƌĞĂŶŝŶĐƌĞĂƐŝŶŐƐŚĂƌĞŽĨĞǆŝƐƚŝŶŐ
trajectory in the coming years?
advertiser budgets through new products/initiatives such as services, multi-location, self-serve and continued ad tech improvements.
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕ŽƵďůĞsĞƌŝĨǇ;sͿƉƌŽĚƵĐĞĚĂŶĂĐƌŽƐƐƚŚĞďŽĂƌĚďĞĂƚǀƐ͘'^ͬ;&ĂĐƚ^ĞƚͿ^ƚƌĞĞƚĞƐƚŝŵĂƚĞƐŽŶďŽƚŚƌĞǀĞŶƵĞĂŶĚĚũ/dǁŝƚŚŶŽƚĂďůĞƐƚƌĞŶŐƚŚǁŝƚŚŝŶŝƚƐĐƚŝǀĂƚŝŽŶƐĞŐŵĞŶƚ͘/ŶŝƚƐĞĂƌŶŝŶŐƐ
report, we saw DV highlight a few key themes: 1) broad based strength across its three segments as the company remains levered to the opportunity for growing clients & spend per client and executing on geographic
Can secular tailwinds (brand safety, fraud, etc.) and
expansion; 2) acknowledging the potential volatility that could come over the next few quarters as ad budgets are potentially rationalized (which would impact growth irrespective of the secular thematic tailwinds that DV is
ŝĚŝŽƐǇŶĐƌĂƚŝĐŐƌŽǁƚŚŽƉƉŽƌƚƵŶŝƚŝĞƐ;ŶĞǁǀĞƌƚŝĐĂůƐ͕ŝŶƚ͛ů͕
exposed to); 3) remaining in investment mode and calling out themes that had been discussed at their Analyst Day (new product development, new channel expansion, international, etc.); & 4) growing number of platform
DoubleVerify DV Buy $ 32 product development, etc.) continue to drive above-
partnerships & capabilities (incl. TikTok, Netflix, etc.). Short term, we expect the overall debate for DV (as with almost the entire digital ad ecosystem) to remain focused on the potential volatility in ad budget allocation over
average industry growth for DV despite an uncertain
the next 3-6 months. Looking longer term, we view DoubleVerify as positively levered to a number of long-term secular tailwinds within digital advertising, including a) steadily increasing penetration of digital as a % of total
digital ad macro environment?
media spend and engagement; b) increasing focus around brand safety, fraud prevention & content moderation across digital media platforms; & c) increasing exposure to faster-growing/emerging digital channels such as
social & connected TV.
Source: Company data, Goldman Sachs Global Investment Research, Factset
18 November 2022 6
Exhibit 6: Key Debates & Our View - Online Travel, Transportation & Food Delivery
Online Travel, Transportation & Food Delivery
EŚĂĚĂƐŽůŝĚYϯ͚ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚǁŝƚŚĂƐůŝŐŚƚďĞĂƚŽŶďŽƚŚďŽŽŬŝŶŐƐͬƌĞǀĞŶƵĞĂŶĚĂŵŽƌĞƉƌŽŶŽƵŶĐĞĚƵƉƐŝĚĞŽŶĚũ/dĂŶĚ&&ĂƐĂŵŝǆŽĨƐƵŵŵĞƌƚƌĂǀĞůƚƌĞŶĚƐƌĞƐƵůƚĞĚŝŶŵĂƌŐŝŶƵƉƐŝĚĞ͘DĂŶĂŐĞŵĞŶƚƌĞŵĂŝŶƐŚŝŐŚůǇ
Can ABNB sustain current revenue growth
convicted in their view that travel as a % of GDP (and, with it, more flexible work) is likely to become a more normative standard in a post-pandemic world. As a result, management continues to emphasize strong forward booking
trends amidst a volatile online travel
trends with some slight headwinds building in terms of short-term ADRs (mostly as a matter of mix shift). In their forward commentary, ABNB management pointed to good visibility into year-end 2022, but with Q4 implying another
Airbnb ABNB Sell $ 98 environment and how will potential ADR
stepdown in terms of YoY growth rates and with open debates about a potential growth slowdown into 2023. With an eye toward 2023, we continue to have concerns about a mixture of changed consumer behavior which could result
normalization translate into margin
in either a general slowdown in travel trends (booking growth), mix shift dynamics that might slow the rate of change on ADRs, both of those elements having a downward pressure on incremental margins & the long-term secular
trajectory over the next 12-24 months?
growth debate that persisted around what a post-pandemic environment looks like (return to office vs. hybrid work environments).
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕<E'ŵĂŶĂŐĞŵĞŶƚƐƚƌƵĐŬĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿYϯ͛ϮϮƌĞƐƵůƚƐ;ŐƌŽƐƐďŽŽŬŝŶŐƐΘƌĞǀĞŶƵĞƐͿĐůŽƐĞĚŽƵƚĂƐƚƌŽŶŐƐƵŵŵĞƌ͛ϮϮƚƌĂǀĞůƐĞĂƐŽŶĂŶĚƚƌĞŶĚƐŚĂǀĞĐŽŶƚŝŶƵĞĚŝŶƚŽKĐƚŽďĞƌǁŝƚŚƐƚƌŽŶŐĨŽƌǁĂƌĚ
,Žǁǁŝůů<E'͛ƐƌĞůĂƚŝǀĞƉŽƐŝƚŝŽŶŝŶŐǁŝƚŚŝŶ
booking and ADR commentary; 2) BKNG continues to invest for the long-term in a host initiatives (loyalty, payments, connected trip, supply, merchandising) and is beginning to see a growth & margin output that should bode positively
Booking online travel translate into revenue growth
Holdings
BKNG Neutral $ 2,270 for long-term forecasts as proof points build in the coming quarters; & 3) continued to express optimism in terms of moving consumer usage of their platform/products to be mobile app driven and basket size to be increasingly driven
& margins in 2023/24 as the end demand
by additional products (both long-term tailwinds to revenues & marketing ROIs). Over the next few quarters, we expect the main investor debate to remain on the volatility in macroeconomic conditions and its resulting impact on
environment remains volatile?
global online travel trends.
Can management execute against evolving /ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕ŽŽƌĂƐŚƉƌĞƐĞŶƚĞĚĂƐƚƌŽŶŐƐĞƚŽĨƌĞƐƵůƚƐ;ĞƐƉĞĐŝĂůůǇǁŚĞŶŵĞĂƐƵƌĞĚĂŐĂŝŶƐƚŝŶǀĞƐƚŽƌĐŽŶĐĞƌŶƐĂďŽƵƚƚŚĞĐŽƌĞĨŽŽĚĚĞůŝǀĞƌǇƉƌŽĚƵĐƚŝĨĐŽŶƐƵŵĞƌďĞŚĂǀŝŽƌǁĞƌĞƚŽďĞĐŽŵĞǀŽůĂƚŝůĞͿ͕ǁŝƚŚďŽƚŚ
its longer-term platform offering (Drive, Marketplace GOV and revenue coming in ahead of our forecasts. Similar to the commentary from UBER mgmt earlier in the week, DASH mgmt has not yet seen any changed consumer behavior inside its delivery marketplace and
local commerce, Storefront, DashMart, guided as such in terms of framing the GOV range for Q4, with the high end of that range ahead of our prior estimate. In addition, while continuing to invest in new verticals, new products and wider geographic scope (notably via the
DoorDash DASH Neutral $ 69
international, etc.) while maintaining Wolt acquisition), DASH upsided both Q3 Adj EBITDA and guided well ahead of GS/Street prior estimates for Q4. Short term, we expect the competitive intensity in the end markets and the potential for volatile consumer behavior to
leading US market share & navigating remain the key investor debate into 2023. In addition, DASH had outsized stock-based compensation expense in Q3 (second quarter in a row), which is seemingly a wider industry dynamic that warrants more scrutiny about levels of
growth deceleration post-COVID? normalization. We continue to view DASH mgmt as focused on continuing to build scale (in terms of products, industry verticals and geographies) rather than optimizing margins in the medium term.
ǆƉĞĚŝĂΖƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚĐŽŶƚŝŶƵĞĚĂƚŚĞŵĞŽĨĂƐƚƌŽŶŐĞŶĚƚŽƚŚĞƐƵŵŵĞƌƚƌĂǀĞůƐĞĂƐŽŶǁŝƚŚĨŽƌǁĂƌĚĐŽŵŵĞŶƚĂƌǇƚŚĂƚƚŚĞĐŽŵƉĂŶǇǁĂƐŶŽƚǇĞƚƐĞĞŝŶŐĂŶǇŝŵƉĂĐƚƐĨƌŽŵƚŚĞŵĂĐƌŽĞĐŽŶŽŵŝĐĨĞĂƌƐƚŚĂƚŚĂǀĞĚŽŵŝŶĂƚĞĚ
investor conversations. In addition, mgmt comments about the potential balance of room night growth and profitability will likely remain the key debate going forward and, in our view, some early successes were on display in this
,ŽǁǁŝůůyW͛ƐƌĞůĂƚŝǀĞƉŽƐŝƚŝŽŶŝŶŐǁŝƚŚŝŶ
earnings report in terms of revenue vs. EBITDA. Mgmt also expressed that ADRs are relatively stable with a solid booking backlog into end of 2022, with a few remaining pockets of global travel demand that are still in recovery mode
online travel translate into revenue growth
Expedia EXPE Buy $ 173 as well (cross border travel, business travel, APAC & overall long-haul flight capacity when compared to 2019 levels). Against that backdrop, EXPE mgmt continues to try to re-align the business against a few key themes: 1) structuring
& margins in 2023/24 as the end demand
its B2C business to prioritize direct traffic, loyalty, mobile app usage and higher marketing returns on booked room nights; 2) a rising exposure to B2B (a segment that exceeded our estimate in this earnings report) & 3) a broader tech
recovery environment remains volatile?
ŵŝŐƌĂƚŝŽŶƚŚĂƚŝƐƐƚŝůůĂǁŽƌŬŝŶƉƌŽŐƌĞƐƐ͘>ĂƐƚůǇ͕yWŵŐŵƚĂůƐŽďĞŐĂŶŝƚƐ;ůŽŶŐĂǁĂŝƚĞĚͿĐĂƉŝƚĂůƌĞƚƵƌŶƐƚƌĂƚĞŐǇǁŝƚŚĂΨϮϬϬŵďƵǇďĂĐŬ;ƚŚƌƵKĐƚŽďĞƌͿĂŶĚĂΨϱϬϬŵĚĞďƚƌĞĚƵĐƚŝŽŶ͕ǁŝƚŚyW͛ƐŶĞǁ&KĞǆƉƌĞƐƐŝŶŐĂĚĞƐŝƌĞƚŽĐŽŶƚŝŶƵĞ
along a path of shareholder returns in the years ahead.
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕>ǇĨƚŵĂŶĂŐĞŵĞŶƚĨƌĂŵĞĚŝƚƐŽƉĞƌĂƚŝŶŐƌĞƐƵůƚƐĂĐƌŽƐƐĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿYϯƌĞǀĞŶƵĞǁĂƐƌŽƵŐŚůǇŝŶůŝŶĞ;ĚƌŝǀĞŶďǇůŝŐŚƚĞƌĂĐƚŝǀĞƌŝĚĞƌƐǀƐ͘'^ĞďƵƚŽĨĨƐĞƚďǇŚŝŐŚĞƌƌĞǀĞŶƵĞƉĞƌĂĐƚŝǀĞƌŝĚĞƌͿďƵƚYϰ
How will the supply/demand dynamics and
revenue guidance was a slight downtick vs prior estimates despite generally positive statements about demand trends into year-end; 2) management is focused on long-term 2024 Adj EBITDA and FCF targets inclusive of layoffs
management's continued investments over
(announced last week), but with potential headwinds around macro & insurance costs implied in Q4 guide acting as near-term margin offsets; & 3) optimism from management about long-term potential for rider density to continue to
Lyft LYFT Buy $ 20 the near-term dictate the longer-term
grow with more moderate pricing & product innovation (Lyft Maps, Upfront Pay, Wait & Save, Priority Pickup). Shorter term, we expect investors will remain focused on the sustained growth rates for US mobility, the competitive
mobility market structure in a
dynamics across the space in terms of market share and how companies handle demand/supply dynamics in Q4. Longer term, we continue to see LYFT as a pure play on the theme of transportation disruption in North America with
normalized/post-COVID environment?
ƐŽŵĞƵƉƐŝĚĞŽƉƚŝŽŶĂůŝƚǇĂƌŽƵŶĚƚŚĞƌŝƐĞŽĨŵŝĐƌŽŵŽďŝůŝƚǇĂŶĚƚŚĞĐŽŵƉĂŶǇ͛ƐĂďŝůŝƚǇƚŽĞǆƉĂŶĚŝƚƐŶĞƚǁŽƌŬŝŶƚŽůĂƐƚŵŝůĞĞŽŵŵĞƌĐĞͬůŽŐŝƐƚŝĐƐ͘
How will a mix of Mobility recovery/Delivery

Over the past several months, UBER mgmt has strung together a series of earnings reports that have demonstrated a consistency in: a) recovery dynamic in its Mobility volumes as an unlock in driver supply has progressed in a
normalization and management's capital
moderating labor market; b) expanding a diversified product mix available to Delivery customers in the face of concerns about a potential slowdown in consumer behavior; c) continued momentum in exceeding forward quarter guided
allocation decisions toward broader
Uber UBER Buy $ 45 Ěũ͘/dƚĂƌŐĞƚƐ;ĞǀĞŶŝŶƚŚĞĨĂĐĞŽĨĂǀŽůĂƚŝůĞŵĂĐƌŽĞĐŽŶŽŵŝĐĞŶǀŝƌŽŶŵĞŶƚͿ͘/ŶŽƵƌǀŝĞǁ͕hZ͛ƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚǁĂƐƚŚĞƚŚŝƌĚƐƵĐŚƋƵĂƌƚĞƌŝŶĚĞǀĞůŽƉŝŶŐůŝŶĞĂƌƉĞƌĨŽƌŵĂŶĐĞĂƐƚŚĞĐŽŵƉĂŶǇĐŽŶƚŝŶƵĞƐƚŽŵĂŬĞƉƌŽŐƌĞƐƐ
platform evolution goals drive revenue
ƚŽǁĂƌĚƐƉƌŽĨŝƚĂďŝůŝƚǇΘ&&ŐŽĂůƐ;ŝŶĐůƵĚŝŶŐŝƚƐƐƚĂƚĞĚŐƵŝĚĂŶĐĞŽĨΨϱďŶŽĨĚũ͘/dŝŶϮϬϮϰͿ͘tŚŝůĞƚŚĞŽǀĞƌĂůůŵĂĐƌŽĞĐŽŶŽŵŝĐĞŶǀŝƌŽŶŵĞŶƚƌĞŵĂŝŶƐǀŽůĂƚŝůĞ͕ŝŶŽƵƌǀŝĞǁ͕hZ͛ƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚĂŶĚĨŽƌǁĂƌĚYϰ͛ϮϮŽƉĞƌĂƚŝŶŐ
growth, margin & FCF trajectory in the
guidance should continue to build investor confidence in that narrative.
coming quarters?
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕sĂĐĂƐĂ;s^ͿŵĂŶĂŐĞŵĞŶƚĨŽĐƵƐĞĚŽŶĂŶƵŵďĞƌŽĨŬĞǇƚŚĞŵĞƐ͗ϭͿYϯŐƌŽǁƚŚǁĂƐƐƚƌŽŶŐĂƐƐƵŵŵĞƌϮϬϮϮĞŶĚĞĚŽŶĂŚŝŐŚŶŽƚĞǁŝƚŚďŽŽŬŝŶŐƐĂŶĚƌĞǀĞŶƵĞĞǆĐĞĞĚŝŶŐĨŽƌĞĐĂƐƚƐ͖ϮͿĨŽƌǁĂƌĚƌĞǀĞŶƵĞ
How will a mixture of supply & demand commentary cited a mixture of bookings weakness in October and new expectation that supply growth would be less than expected by year-end 2022; & 3) Q3 and forward Adj EBITDA performance/commentary came up well short of
normalization impact topline growth in the GS/Street as the company cited poor execution on new CRM system and need to pivot property growth strategy back toward individual properties. Short term, like many names in the online travel and shared accommodation sub-
abf1713081cf4bd28921692cb124a462
Vacasa VCSA Neutral $ 4 coming years and can management execute sectors, we expect the key investor debate to remain on a mix of consumer demand & supply growth in the coming 6-12 months. In particular to VCSA, we view the elements of executing on supply growth (more individual properties
against cost efficiency efforts to drive than portfolio acquisitions) and driving operating efficiencies (compared to short-term headwinds) as key to re-building the linear narrative into normalized growth and rising margin profile in the coming years. Longer term, we
margin expansion? continue to see Vacasa as well positioned to capitalize on the secular tailwinds of the alternative accommodations market (with a solid runway for growth over our forecast period as alternative accommodations continue to gain
consumer adoption and take share of the broader travel market).
Source: Company data, Goldman Sachs Global Investment Research, FactSet
18 November 2022 7
Exhibit 7: Key Debates & Our View - Online Dating, Video Games
Online Dating
How will MTCH navigate continued macro

headwinds (esp. on its ALC business) & will the
/ŶŝƚƐYϯΖϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕DĂƚĐŚ'ƌŽƵƉƌĞƉŽƌƚĞĚĂƐĞƚŽĨďĞƚƚĞƌƚŚĂŶĞǆƉĞĐƚĞĚƚŽƉůŝŶĞĂŶĚĚũ͘K/ƌĞƐƵůƚƐǁŝƚŚĂŶŝŶŝƚŝĂůϮϬϮϯƌĞǀĞŶƵĞŐƌŽǁƚŚŽƵƚůŽŽŬůĂƌŐĞůǇĂďŽǀĞďƵǇƐŝĚĞĞǆƉĞĐƚĂƚŝŽŶƐ͘tŚŝůĞŝƚŝƐƚŽŽĞĂƌůǇƚŽĚŝƐŵŝƐƐƚŚĞďĞĂƌƚŚĞƐŝƐĂƌŽƵŶĚdŝŶĚĞƌ͛Ɛ
company overcome execution challenges to
ĨŽƌǁĂƌĚƌĞǀĞŶƵĞŐƌŽǁƚŚƉŽƚĞŶƚŝĂů;ŽƌƚŚĞůĂĐŬƚŚĞƌĞŽĨͿĂŶĚŽŶůŝŶĞĚĂƚŝŶŐƉĞŶĞƚƌĂƚŝŽŶůĞǀĞůƐƌĞĂĐŚŝŶŐĂĐĞŝůŝŶŐƐƉĞĐŝĨŝĐĂůůǇŝŶŵŽƌĞŵĂƚƵƌĞŵĂƌŬĞƚƐ͕ǁĞĐĂŵĞĂǁĂǇĐŽŶƐƚƌƵĐƚŝǀĞŽŶŵĂŶĂŐĞŵĞŶƚ͛ƐĨŽƌǁĂƌĚĐŽŵŵĞŶƚĂƌǇĞƐƉĞĐŝĂůůǇĂƐƉƌŽĚƵĐƚĞǆĞĐƵƚŝŽŶĂƚ
Match Group MTCH Buy $ 70 address monetization opportunities (female
dŝŶĚĞƌŝƐƐƚĂƌƚŝŶŐƚŽŝŵƉƌŽǀĞ;ŝ͘Ğ͕͘ƌĞĐĞŶƚůǇďĞŐĂŶƚĞƐƚŝŶŐĂŶĞǁŽĨĨĞƌŝŶŐŝŶŽŽƐƚƉƌŽĚƵĐƚůŝŶĞ͕ǁĞĞŬůǇĨĞĂƚƵƌĞΘĂ͞ƌĞůĂƚŝŽŶƐŚŝƉŝŶƚĞŶƚ͟ͲĨĞĂƚƵƌĞͿ͘dŚĂƚďĞŝŶŐƐĂŝĚ͕ǁŝƚŚŵĂĐƌŽĞǆƉĞĐƚĞĚƚŽƌĞŵĂŝŶǀŽůĂƚŝůĞŽǀĞƌƚŚĞŶĞǆƚĨĞǁƋƵĂƌƚĞƌƐ;ĂŶĚŵŐŵƚ͘ŶŽƚŝĐŝŶŐĂ
focused package, GenY, Virtual Coins & Goods
deterioration in the last few weeks of the quarter esp. as it relates to ALC revenues), we take a more measured approach in terms of modeling 2023 with GS at +6.4% YoY vs. company guidance of 5-10% YoY.
etc.) to drive revenue growth & margins in the
coming quarters?
ƵŵďůĞƌĞƉŽƌƚĞĚĂŵŝǆĞĚƐĞƚŽĨYϯ͛ϮϮƌĞƐƵůƚƐǁŝƚŚƌĞǀĞŶƵĞŐƌŽǁƚŚĐŽŵŝŶŐŝŶďĞůŽǁĞǆƉĞĐƚĂƚŝŽŶƐ;ŝŵƉĂĐƚĞĚďǇĂĐŽŵďŝŶĂƚŝŽŶŽĨŵĂĐƌŽĂŶĚŵŝĐƌŽĐŚĂůůĞŶŐĞƐͿĂůďĞŝƚǁŝƚŚŚŝŐŚĞƌͲƚŚĂŶͲĞǆƉĞĐƚĞĚĚũ͘/dŵĂƌŐŝŶƐĂƐƚŚĞĐŽŵƉĂŶǇŝƐĨŽĐƵƐĞĚŽŶ
ŵĂŝŶƚĂŝŶŝŶŐĐŽƐƚĚŝƐĐŝƉůŝŶĞ͘ƵŵďůĞYϯŶĞƚĂĚĚƐĂĐĐĞůĞƌĂƚĞĚƚŽнϭϲϰŬǀƐ͘нϭϰϵŬŝŶYϮĂƐƚŚĞďƌĂŶĚ͛ƐŵŽŵĞŶƚƵŵŝŶŝŶƚĞƌŶĂƚŝŽŶĂůĞƐƉ͘ŝŶtĞƐƚĞƌŶƵƌŽƉĞĐŽŶƚŝŶƵĞĚŝŶƚŽYϯǁŝƚŚĂĚŽŽƌĞƉŽƌƚŝŶŐƉŽƐŝƚŝǀĞŶĞƚĂĚĚƐŽĨнϭϬϲŬ;ǀƐ͘ͲϭϯϲŬŝŶYϮͿůĂƌŐĞůǇĚƌŝǀĞŶďǇ
How will a mix of near-term headwinds
ƉƌŽĚƵĐƚŝŵƉƌŽǀĞŵĞŶƚƐ͘ĚĚŝƚŝŽŶĂůůǇ͕ŵĂŶĂŐĞŵĞŶƚƉƌŽǀŝĚĞĚĂŶŝŶŝƚŝĂůϮϬϮϯƌĞǀĞŶƵĞŐƌŽǁƚŚŽƵƚůŽŽŬƚŚĂƚůĂƌŐĞůǇĨĞůůƐŚŽƌƚŽĨ^ƚƌĞĞƚĞǆƉĞĐƚĂƚŝŽŶƐĂƐĂŵŽƌĞĐŚĂůůĞŶŐŝŶŐŵĂĐƌŽĞŶǀŝƌŽŶŵĞŶƚ;ŝŶĐů͘&yͿĐŽŶƚŝŶƵĞƐƚŽǁĞŝŐŚŽŶƵŵďůĞ͛ƐŽƉĞƌĂƚŝŶŐƉĞƌĨŽƌŵĂŶĐĞ͘
(combination of macro & product delays) vs.
Bumble BMBL Buy $ 30 ŽŵŝŶŐŽƵƚŽĨĞĂƌŶŝŶŐƐ͕ǁĞĞǆƉĞĐƚŝŶǀĞƐƚŽƌƐƚŽďĞƐƋƵĂƌĞůǇĨŽĐƵƐĞĚŽŶϮϬϮϯƌĞǀĞŶƵĞŐƌŽǁƚŚĚǇŶĂŵŝĐƐŝŶĐůƵĚŝŶŐĂŶǇĐŚĂŶŐĞŝŶƚŚĞďƌŽĂĚĞƌŵĂĐƌŽĞĐŽŶŽŵŝĐĞŶǀŝƌŽŶŵĞŶƚ;ĂŶĚƚŚĞƌĞƐƉĞĐƚŝǀĞŝŵƉĂĐƚŽŶƵŵďůĞ͛ƐďƵƐŝŶĞƐƐĂŶĚƵƐĞƌďĂƐĞͿ͕ƚŚĞƉĂĐĞΘ
longer-term tailwinds translate into revenue
cadence of its international expansion efforts, management execution against a number of announced product initiatives as well as management striking a balance between investing behind key growth initiatives & marketing vs. expanding its Adj.
growth & margin expansion in 2023 & beyond?
EBITDA margin profile towards their +100bps guide for FY23. While we remain constructive on the long-term revenue growth opportunity against a large online dating TAM, we expect the stock to be range bound in the near-term until we gain greater
clarity on 2023 revenue growth drivers, the pace and cadence of product launches as well as any incremental color on management's success to offset some of the macro headwinds (e.g., by modifying product & marketing).
Video Games
/ŶŝƚƐϭ&,ϮϯĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕hďŝƐŽĨƚŵĂŶĂŐĞŵĞŶƚƌĞƉŽƌƚĞĚƐƚƌŽŶŐƚŽƉůŝŶĞƌĞƐƵůƚƐůĂƌŐĞůǇĚƌŝǀĞŶďǇƚŚĞƌĞǀĞŶƵĞƌĞĐŽŐŶŝƚŝŽŶŽĨƚŚĞĐŽŵƉĂŶǇ͛ƐƌĞĐĞŶƚŵŽďŝůĞůŝĐĞŶƐŝŶŐƉĂƌƚŶĞƌƐŚŝƉďƵƚƌĞƉŽƌƚĞĚŵĞĂŶŝŶŐĨƵůůǇůŽǁĞƌW^ĚƌŝǀĞŶďǇĂĐĐĞůĞƌĂƚĞĚĚĞƉƌĞĐŝĂƚŝŽŶ
Can UBI grow margins against a backdrop of an ǁŝƚŚŝŶZΘ͘hďŝƐŽĨƚƌĞŝƚĞƌĂƚĞĚŝƚƐ&zϮϯŐƵŝĚĂŶĐĞŽĨƐŝŐŶŝĨŝĐĂŶƚƚŽƉůŝŶĞŐƌŽǁƚŚ;ĚĞƐƉŝƚĞĚĞůĂǇŝŶŐ^ŬƵůůΘŽŶĞƐƚŽDĂƌĐŚͿĂŶĚΦϰϬϬŵŵŝŶŶŽŶͲ/&Z^/d͖ŝŶĂĚĚŝƚŝŽŶ͕ŵĂŶĂŐĞŵĞŶƚƌĞŝƚĞƌĂƚĞĚƚŚĞŝƌƌĞŽƌŐĂŶŝǌĂƚŝŽŶĞĨĨŽƌƚƐƚŚĂƚƐŚŽƵůĚǇŝĞůĚƐƚƌŽŶŐŵĂƌŐŝŶ
Ubisoft UBI Neutral ¼ 37
ambitious content slate? ĞǆƉĂŶƐŝŽŶŝŶ&zϮϰ;ĚĞƐƉŝƚĞhďŝƐŽĨƚƌĞŵĂŝŶŝŶŐŝŶŝŶǀĞƐƚŵĞŶƚŵŽĚĞŽŶĂŵƵůƚŝͲǇĞĂƌǀŝĞǁͿ͘/ŶŽƵƌǀŝĞǁ͕ƚŚĞĐŽŵƉĂŶǇ͛ƐŵŽďŝůĞƉĂƌƚŶĞƌƐŚŝƉĂŶĚƌĞŽƌŐĂŶŝǌĂƚŝŽŶĞĨĨŽƌƚƐǁŝůůƉƌŽǀŝĚĞƐƵƉƉŽƌƚĂƌŽƵŶĚƚŚĞƚŽƉĂŶĚďŽƚƚŽŵůŝŶĞƚƌĂũĞĐƚŽƌǇŝŶƚŚĞŶĞĂƌͲƚŽͲŵĞĚŝƵŵ
term.
In its 2FQ23 earnings report, EA produced solid results that were roughly inline with GS/Street estimates with respect to bookings and a solid upside surprise with respect to non-GAAP EBIT (given revenue mix shift towards PC/Console vs. Mobile). In its
How will EA execute against its strategic forward operating commentary, EA mgmt took a more measured tone, commenting on softness in overall mobile gaming trends, the delay of the Lord of the Rings: Heroes of Middle Earth mobile game, and a back end loaded dynamic (into the final fiscal
Electronic initiatives of its core portfolio of games, mobile ƋƵĂƌƚĞƌŝŶDĂƌĐŚͿǁŝƚŚƌĞƐƉĞĐƚƚŽĂůĂƌŐĞƉŽƌƚŝŽŶŽĨƚŚŝƐǇĞĂƌ͛ƐŐĂŵĞĐŽŶƚĞŶƚ͘/ŶƚŽƚĂů͕ĐŽŶƚŝŶƵĞƐƚŽƐĞĞďƌŽĂĚͲďĂƐĞĚƐƵĐĐĞƐƐĂŶĚĞǆĞĐƵƚŝŽŶĂƌŽƵŶĚŵĂŶǇŽĨŝƚƐŬĞǇƚŝƚůĞƐŝŶƚŚĞƐƉŽƌƚƐĐĂƚĞŐŽƌǇ;ǁŝƚŚtŽƌůĚƵƉƚŚĞŵĞĚĐŽŶƚĞŶƚůĂƵŶĐŚŝŶŐĨŽƌ&/&ŝŶƚŚĞ
EA Neutral $ 126
Arts launches, international, and recent ĞĐĞŵďĞƌƋƵĂƌƚĞƌͿ͘>ŽŽŬŝŶŐĨŽƌǁĂƌĚ͕ǁĞǁŽƵůĚĞǆƉĞĐƚĂŶǇĂĚĚŝƚŝŽŶĂůĐŽůŽƌŽŶƚŚĞ͞ŵĂũŽƌ/W͟ƚŝƚůĞ;ƵŶŶĂŵĞĚͿŝŶƚŚĞDĂƌĐŚƋƵĂƌƚĞƌĐŽƵůĚĂĐƚĂƐĂƐŚŽƌƚͲƚĞƌŵĐĂƚĂůǇƐƚĨŽƌƐŚĂƌĞƐĂŶĚĂŶǇŝŶĐƌĞŵĞŶƚĂůĐŽůŽƌĂƌŽƵŶĚƚŚĞDĂƌǀĞůƉĂƌƚŶĞƌƐŚŝƉĐŽƵůĚďĞĂůŽŶŐͲ
acquisitions? term driver of new IP. Looking ahead, we still frame EA as a company with growth mostly driven by their core portfolio, mobile strategy, international expansion, M&A opportunities and organic projects, and long-term EBITDA margin expansion to be
realized in the out years.
/ŶŝƚƐ&YϮ͛ϮϯĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕ddtKŵŐŵƚƐƚƌƵĐŬĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿĨŽƌǁĂƌĚĐŽŵŵĞŶƚĂƌǇĨƌŽŵddtKŵŐŵƚŝŵƉůŝĞĚƚŚĂƚĨŽƌǁĂƌĚďŽŽŬŝŶŐƐͬƌĞǀĞŶƵĞĂƌĞĨĂĐŝŶŐŚĞĂĚǁŝŶĚƐĨƌŽŵĞůĞŵĞŶƚƐŽĨƉŝƉĞůŝŶĞƐŚŝĨƚƐ͕ŵŽďŝůĞŝŶĚƵƐƚƌǇŚĞĂĚǁŝŶĚƐĂŶĚĨͬǆŚĞĂĚǁŝŶĚƐ
ʹǁŚŝĐŚŝŶĂŐŐƌĞŐĂƚĞŵĞƚǁŚĂƚŚĂĚďĞĞŶŝŶǀĞƐƚŽƌĨĞĂƌƐŝŶƚƌĂͲƋƵĂƌƚĞƌ͖ϮͿůŽŶŐͲƚĞƌŵŽƉƚŝŵŝƐŵĨƌŽŵŵŐŵƚĂƌŽƵŶĚƚŚĞŽƉƉŽƌƚƵŶŝƚǇƐĞƚĨƌŽŵŵŽďŝůĞŐĂŵŝŶŐ͕ĐŽŶƐŽůĞͬW͕ƚŚĞƌŝƐŝŶŐŚǇďƌŝĚŵŽĚĞůƐĨŽƌŵĂŶǇƚŝƚůĞƐĂŶĚƚŚĞŝƌŽǁŶĐŽŶƚĞŶƚƉŝƉĞůŝŶĞĂŐĂŝŶƐƚƚŚŽƐĞ
addressable market dynamics; & 3) continued levels of high player engagement led by Grand Theft Auto V, NBA 2K23 and Red Dead Redemption 2. In our recent upgrade note for TTWO shares, we did frame a short-term that could remain plagued by
How will TTWO integrate Zynga and leverage headwinds (consumer behavior, f/x translation & mobile gaming industry dynamics) and, unfortunately, those headwinds dominated the narratives coming out of this earnings report. As we move past 2022 into the next few years, we see a couple of key
Take-Two TTWO Buy $ 150
their mobile capabilities long term? industry themes emerging: 1) easier comps as such user growth/engagement trends are lapped and the industry resumes more normalized growth dynamics (as outlined in the recent coverage resumption report from our Japan Games, Entertainment, &
Internet team); 2) the industry's recent moves to raise the level of mobile gaming exposure (for TTWO via the Zynga acquisition) into a category that should provide above industry wide growth in the coming years; & 3) the console cycle (now in its 3rd
ǇĞĂƌͿĨŝŶĂůůǇƐĞĞŝŶŐĂĐĂƚĐŚƵƉƚƌĂĚĞŝŶϮϬϮϯŝŶƚĞƌŵƐŽĨƵŶŝƚƐĂƐŐůŽďĂůĐŚŝƉĂŶĚƐƵƉƉůǇͬůŽŐŝƐƚŝĐŚĞĂĚǁŝŶĚƐďĞŐŝŶƚŽĂďĂƚĞʹǁŝƚŚĞĂƌůǇĞǀŝĚĞŶĐĞƚŚĂƚŶĞǆƚŐĞŶĐŽŶƐŽůĞƐĂƌĞĨŽůůŽǁŝŶŐĂŶŽƌŵĂůŝǌĞĚƉĂƚƚĞƌŶŽĨƉƌŽĚƵĐŝŶŐŝŶĐƌĞĂƐĞĚƐŽĨƚǁĂƌĞ/WŵŽŶĞƚŝǌĂƚŝŽŶŝŶ
terms of attach rate.
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕WůĂǇƚŝŬĂ;W>d<ͿƐƚƌƵĐŬĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿƌĞǀĞŶƵĞǁĂƐĂŵŝǆĞĚƉŝĐƚƵƌĞďĞƚǁĞĞŶƐƚƌĞŶŐƚŚŝŶĐĂƐƵĂůŐĂŵĞƐďƵƚǁĞĂŬŶĞƐƐŝŶƚŚĞƐŽĐŝĂůĐĂƐŝŶŽĐĂƚĞŐŽƌǇĂŐĂŝŶƐƚĂďƌŽĂĚĞƌǀŽůĂƚŝůĞŵĂĐƌŽďĂĐŬĚƌŽƉĨŽƌŐĂŵŝŶŐŵŽŶĞƚŝǌĂƚŝŽŶ͖ϮͿ
Will Playtika execute on its casual portfolio
ĐŽŵƉĂŶǇƌĞŵĂŝŶƐĨŽĐƵƐĞĚŽŶŝŶǀĞƐƚŵĞŶƚƐĨŽƌϮϬϮϯʹĂĚũƵƐƚŝŶŐƉƌŽĚƵĐƚĂƉƉƌŽĂĐŚŽŶ^ůŽƚŽŵĂŶŝĂĨŽƌϮϬϮϯ͖ĚƌŝǀŝŶŐ/ƚŽŽůƐŝŶƚŽƐƚƵĚŝŽƉŽƌƚĨŽůŝŽΘĂůŝŐŶŝŶŐŵĂƌŬĞƚŝŶŐǁŝƚŚŵŽƌĞƚĂƌŐĞƚĞĚŐƌŽǁƚŚŽƉƉŽƌƚƵŶŝƚŝĞƐ͖ΘϯͿĞŵƉŚĂƐŝǌŝŶŐΨϲϱϬŵĐĂƐŚďĂůĂŶĐĞ;ƉŽƐƚ
Playtika PLTK Neutral $ 15 against a backdrop of high industry M&A
ƚĞŶĚĞƌͿǁŝƚŚŵŐŵƚĐŽŵŵĞŶƚŝŶŐŽŶƉŽƐƐŝďůĞĂĐƋƵŝƐŝƚŝŽŶƐƚŽƐĐĂůĞƚŚĞƉůĂƚĨŽƌŵŝŶĐŽŵŝŶŐǇĞĂƌƐ͘/ŶƚŚĞƐŚŽƌƚƚĞƌŵ͕ǁĞĞǆƉĞĐƚƚŚĞŝŶǀĞƐƚŽƌĚĞďĂƚĞƐƚŽƌĞŵĂŝŶĨŽĐƵƐĞĚŽŶW>d<͛ƐƌŽůĞŝŶƚŚĞďƌŽĂĚĞƌŵŽďŝůĞŐĂŵŝŶŐůĂŶĚƐĐĂƉĞ;ǁŚŝĐŚŝƐĨĂĐŝŶŐŚĞĂĚǁŝŶĚƐͿĂŶĚ
activity?
some of the idiosyncratic need to turn around the slot-themed games. Longer term, we see the emergence of a direct-to-consumer platform approach as a way to drive growth and amplify margins as it scales in the years ahead.
/ŶƚĞƌŵƐŽĨŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚĂŶĚKĐƚŽďĞƌ͚ϮϮƚƌĞŶĚƐĚŝƐĐůŽƐƵƌĞ͕ZŽďůŽǆ;Z>yͿŵŐŵƚƐƚƌƵĐŬĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿĞůĞŵĞŶƚƐŽĨƵƐĞƌŐƌŽǁƚŚΘƉůĂƚĨŽƌŵŵŽŶĞƚŝǌĂƚŝŽŶŚĂǀĞƐŚŽǁŶƐŝŐŶƐŽĨƌĞͲĂĐĐĞůĞƌĂƚŝŽŶŝŶYϯǁŚŝĐŚůĞĂǀĞƐƚŚĞĐŽŵƉĂŶǇǁĞůů
positioned for stable levels of growth into 2023; 2) the company remains in investment mode across a number of key areas (headcount, advertising business, developer scale, owned/operated infrastructure & trust/safety) in a manner that is likely to
pressure GAAP operating margins over the short/medium term (& mask long-term profit potential over that time period); & 3) success in terms of aging-up the platform as an output of product and platform initiatives (which will require monitoring as a
How will Roblox perform short term and
potential source of increased platform monetization and scale in the coming years). Short term, we expect the investor debate to remain on the levels of growth (as defined in terms of normalization) that RBLX can achieve in forward periods compared
Roblox RBLX Sell $ 24 execute against its longer term vision of the
to the next 12-18 month investment cycle cadence. Looking long term, we still see Roblox as a well-positioned company in the gaming/interactive entertainment coverage universe for where the long-term secular growth opportunities sit in the gaming
metaverse?
abf1713081cf4bd28921692cb124a462
landscape (open world, user/developer dynamics capturing Web 3 themes, shifting habits of the gaming user) with the open-ended question being the ability for the platform to maintain/expand on recent momentum in terms of aging-up and materially
expanding GAAP profitability against its current enterprise value. Looking across the next 12 months, we still see a more negative risk/reward skew in terms of the shares as the company continues to invest heavily for the long term in a market
environment that is increasingly placing a premium on being able to value companies on GAAP profitability metrics.
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕ƉƉ>ŽǀŝŶ;WWͿŵŐŵƚĨŽĐƵƐĞĚŽŶĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿƚŚĞďƵƐŝŶĞƐƐŝƐŶŽǁĨĂĐŝŶŐĂŶƵŵďĞƌŽĨŚĞĂĚǁŝŶĚƐĂƐǁĞĐŽŵƉůĞƚĞϮϬϮϮĂŶĚĞŶƚĞƌϮϬϮϯʹĨƌŽŵǁĞĂŬĞƌĂĚďƵĚŐĞƚĚǇŶĂŵŝĐƐĂƐĂŶŽƵƚƉƵƚŽĨŐĂŵĞƌŐƌŽǁƚŚͬŵŽŶĞƚŝǌĂƚŝŽŶ
Will AppLovin be able to grow its software
ƉŽƚĞŶƚŝĂů͕ƐƚĂďůĞŚĞĂĚǁŝŶĚƐĨƌŽŵƉƉůĞ͛ƐƉƌŝǀĂĐǇĐŚĂŶŐĞƐŽǀĞƌϭϮŵŽŶƚŚƐĂŐŽΘǁŽƌŬͲŝŶͲƉƌŽŐƌĞƐƐĚǇŶĂŵŝĐƐĂƌŽƵŶĚĚŝǀĞƌƐŝĨǇŝŶŐƚŚĞ^ŽĨƚǁĂƌĞƌĞǀĞŶƵĞƚŽǁĂƌĚĂŵŽƌĞĚŝǀĞƌƐŝĨŝĞĚƐĞƚŽĨĂĚǀĞƌƚŝƐĞƌƐĂŶĚĂĚƉƌŽĚƵĐƚƐ͖ϮͿĂŶƉƉƐƌĞǀĞŶƵĞƐƚƌĞĂŵƚŚĂƚƐŚŽƵůĚ
AppLovin APP Buy $ 33 revenue and integrate their strategic
ĞǆŝƚϮϬϮϮǁŝƚŚŽƉƚŝŵŝǌĂƚŝŽŶĐŽŵƉůĞƚĞŽĨƐŵĂůůĚŝǀĞƐƚŝƚƵƌĞƐΘŵŝǆŽĨŐĂŵĞƐŽƉƚŝŵŝǌĞĚĨŽƌŐƌŽǁƚŚǀƐĐĂƐŚĨůŽǁʹŝŶƚŽƚĂůƉƌŽĚƵĐŝŶŐĂŶĞŐĂƚŝǀĞŐƌŽǁƚŚĚǇŶĂŵŝĐǁŝƚŚďĞƚƚĞƌŵĂƌŐŝŶŽƵƚƉƵƚ;ĂƐĞǀŝĚĞŶĐĞĚŝŶƚŚĞYϯƌĞƐƵůƚƐͿ͖ΘϯͿŵŐŵƚĐŽŶƚŝŶƵĞƐƚŽĨŽĐƵƐŽŶ
acquisitions?
striking a balance between long-term investments, maintaining current balance sheet leverage and targeting s/h returns via buyback.
/ŶŝƚƐYϯ͚ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕^ĐŝWůĂǇ;^W>ͿŵŐŵƚƐƚƌƵĐŬĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿƐŽůŝĚďĞĂƚŽŶƌĞǀĞŶƵĞǁŝƚŚƚŚĞŝƌŐĂŵĞƐ;ƐŽĐŝĂůĐĂƐŝŶŽͿƚĂŬŝŶŐƐŚĂƌĞǁŝƚŚŝŶƚŚĞďƌŽĂĚĞƌŵŽďŝůĞŐĂŵŝŶŐŝŶĚƵƐƚƌǇ͖ϮͿŵĂƌŐŝŶƌŽƵŐŚůǇŝŶůŝŶĞĂƐƚŚĞĐŽŵƉĂŶǇƌĞŵĂŝŶƐƐƋƵĂƌĞůǇŝŶ
How will investments (marketing innovation,
investment mode (marketing innovation, SciPlay engine & direct to consumer business) as potential drivers of growth and high RoIs longer term; & 3) remains focused on stock buyback (current remaining authorization is ~$32mm). Shorter term, we
SciPlay engine, and direct-to-consumer
Sciplay SCPL Buy $ 20 expect the key investor debate to remain squarely focused on the headwinds facing the broader mobile gaming sector (consumer spend, post pandemic normalization & iOS user acquisition/monetization headwinds) and how investments yield a mix of
business) drive outperformance vs. the industry
revenue growth and/or higher LTV (lifetime value) of game users. Longer term, we see SCPL as levered to the rise of mobile gaming more broadly and more specifically within certain sub-verticals (e.g., casual) which should outgrow the overall gaming
and how will margins evolve over time?
industry as mgmt balances growth, margin evolution and capital returns.
Source: Company Data, FactSet, Goldman Sachs Global Investment Research
18 November 2022 8
Exhibit 8: Key Debates & Our View - eCommerce, Streaming Media & Subscription Services
eCommerce
How will a mixture of macro/industry factors (incl. a DE͛ƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚƉƌŽĚƵĐĞĚĂŵŝǆĞĚƐĞƚŽĨYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƐƵůƚƐĂŶĚĨŽƌǁĂƌĚYϰ͛ϮϮŽƉĞƌĂƚŝŶŐŐƵŝĚĞĂƐĂĨĞǁŬĞǇƚŚĞŵĞƐĞŵĞƌŐĞĚ͗ϭͿŐƌŽǁƚŚŚĂƐďĞŐƵŶƚŽƐůŽǁƚŽƌĞĨůĞĐƚƚŚĞƐŽĨƚĞŶŝŶŐŵĂĐƌŽĞĐŽŶŽŵǇǁŝƚŚĞŽŵŵĞƌĐĞ;ĞƐƉĞĐŝĂůůǇƵƌŽƉĞͿĐŝƚĞĚďǇƚŚĞĐŽŵƉĂŶǇĂƐƐůŽǁŝŶŐƚŚƌŽƵŐŚ

challenging global consumer environment; post ƚŚĞƋƵĂƌƚĞƌĂŶĚŝŶĨŽƌŵŝŶŐĂƐƚĞƉĚŽǁŶŝŶŐƌŽǁƚŚŝŶYϰ͕ϮͿt^;ĐůŽƵĚĐŽŵƉƵƚŝŶŐͿĚĞĐĞůĞƌĂƚĞĚΕϲϬϬďƉƐŝŶYϯĂŶĚĞǆŝƚĞĚ^ĞƉƚĞŵďĞƌĂƚŵŝĚͲϮϬйƌĞǀĞŶƵĞŐƌŽǁƚŚ;ŶŽǁŝŶĨŽƌŵŝŶŐĂŵƵůƚŝƋƵĂƌƚĞƌƐůŽǁĚŽǁŶŝŶŽƵƌƵƉĚĂƚĞĚĨŽƌĞĐĂƐƚƐĂĐƌŽƐƐYϰ͛ϮϮĂŶĚϭ,͛ϮϯͿĂŶĚϯͿůĂƐƚƋƵĂƌƚĞƌ͛ƐŝŵƉƌŽǀĞŵĞŶƚ
COVID eCommerce growth), segment mix ĂŐĂŝŶƐƚĂŶĂƌƌĂǇŽĨŵƵůƚŝͲǇĞĂƌŽƉĞƌĂƚŝŶŐŝŶĐŽŵĞŚĞĂĚǁŝŶĚƐǁĂƐƌĞǀĞƌƐĞĚǁŝƚŚĂYϯ͛ϮϮŽƉĞƌĂƚŝŶŐŝŶĐŽŵĞŵĂƌŐŝŶŝŵƉĂĐƚĞĚďǇůĞƐƐƌĞĐĂƉƚƵƌĞĚĞĨĨŝĐŝĞŶĐŝĞƐ͕ŚŝŐŚĞƌĞŶĞƌŐǇĐŽƐƚƐΘƐŽŵĞŽŶĞͲƚŝŵĞŝƚĞŵƐ͘/ŶĂĚĚŝƚŝŽŶ͕ƚŚĞYϰ͛ϮϮŽƉĞƌĂƚŝŶŐŝŶĐŽŵĞŐƵŝĚĂŶĐĞĐĂŵĞŝŶĂďŽƵƚΨϭďŶůŽǁĞƌƚŚĂŶĞǆƉĞĐƚĞĚĂƚ
Amazon AMZN Buy $ 165 (eCommerce vs. AWS vs. advertising) & continued the high end of the range. Looking ahead, we see industry checks around consumer demand (especially into and out of the Cyber 5 event in a few weeks) as likely going to be critical to gaining greater visibility in eCommerce trends for the holiday period. We are unchanged in our long-term view
investments vs. external cost headwinds ŽĨƚŚĞƉŽƚĞŶƚŝĂůĨŽƌĐůŽƵĚĐŽŵƉƵƚŝŶŐ;ĂƐĞǀŝĚĞŶĐĞďǇŵĂǌŽŶ͛ƐΨϭϬϰďŶƌĞǀĞŶƵĞďĂĐŬůŽŐƚŚĂƚŐƌĞǁнϱϳйzŽzͿďƵƚĂĐŬŶŽǁůĞĚŐĞƚŚĂƚĞĐŽŶŽŵŝĐĐŽŶĚŝƚŝŽŶƐǁŝůůůŝŬĞůǇƉƌŽĚƵĐĞƐůŽǁĞƌƚŚĂŶŶŽƌŵĂůŐƌŽǁƚŚĂŶĚŵĂƌŐŝŶƐŝŶƚŚĞĐŽŵŝŶŐƋƵĂƌƚĞƌƐ͘/ŶƚĞƌŵƐŽĨŝƚƐĐŽƐƚƐƚƌƵĐƚƵƌĞ͕ŵĂǌŽŶĐŽŶƚŝŶƵĞƐƚŽĨĂĐĞ
drive Amazon's revenue growth & margin trajectory ďƌŽĂĚŝŶĨůĂƚŝŽŶĂƌǇŚĞĂĚǁŝŶĚƐ;ĞŶĞƌŐǇ͕ůĂďŽƌ͕ƉƌŽĚƵĐƚĐŽƐƚƐΘĨƌĞŝŐŚƚͿ͕ĂůƚŚŽƵŐŚŝƚŚĂƐŵĂĚĞƉƌŽŐƌĞƐƐŽŶŝŵƉƌŽǀŝŶŐĞĨĨŝĐŝĞŶĐǇĂŶĚƚĂĐŬůŝŶŐďŽƚŚĨƵůĨŝůůŵĞŶƚĂŶĚĞŵƉůŽǇĞĞŽǀĞƌĐĂƉĂĐŝƚǇŝƐƐƵĞƐƚŚĂƚŚĂĚďĞĞŶĨůĂŐŐĞĚŝŶϭ,͚ϮϮ͘ĂƐĞĚŽŶŽƵƌǁŽƌŬ͕ǁĞƌĞŵĂŝŶĐŽŶǀŝŶĐĞĚŝŶĂŵƵůƚŝͲǇĞĂƌŽƉĞƌĂƚŝŶŐ
into 2023? income margin expansion story for Amazon on the back of improved eCommerce margins, less International losses & higher profit margin mix contribution from AWS and advertising.
How will management balance topline growth

/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕ĞĂǇŵĂŶĂŐĞŵĞŶƚƉƌŽĚƵĐĞĚĂƐŽůŝĚƐĞƚŽĨŽƉĞƌĂƚŝŶŐƌĞƐƵůƚƐ;ǁŝƚŚƵƉƐŝĚĞƚŽŽƵƌĨŽƌĞĐĂƐƚĞĚh^'DsΘƚŽƚĂůƌĞǀĞŶƵĞͿ͘KŶĨŽƌǁĂƌĚŐƌŽǁƚŚĚƌŝǀĞƌƐ͕ƚŚĞĐŽŵƉĂŶǇƉŽŝŶƚƐƚŽƐƚƌĞŶŐƚŚĂŵŽŶŐƚŚĞŝƌĞŶƚŚƵƐŝĂƐƚďƵǇĞƌďĂƐĞ;ŝŶĐů͘ůĞǀĞůƐŽĨƐŚŽƉƉŝŶŐĂŶĚĐĂƚĞŐŽƌǇĞǆƉĂŶƐŝŽŶͿĂƐ
(amidst a challenging consumer environment esp. in
well as advertising and payment initiatives driving take rates to the point that revenue continues to outpace GMV. Looking forward to Q4, EBAY mgmt painted a more cautious picture for consumer behavior specifically highlighting continued headwinds from a volatile European consumer
eBay EBAY Sell $ 41 Europe) with investments in key area (i.e., focus
ĞŶǀŝƌŽŶŵĞŶƚĂŶĚĂh^ĐŽŶƐƵŵĞƌƚŚĂƚŚĂƐǁĞĂŬĞŶĞĚŝŶKĐƚŽďĞƌʹƚŚĞƌĞƐƵůƚŽĨďŽƚŚƚŚĞŵĞƐǁĂƐĂƌĞǀĞŶƵĞŐƵŝĚĂŶĐĞƚŚĂƚǁĂƐΕϯйďĞůŽǁŽƵƌƉƌŝŽƌĨŽƌĞĐĂƐƚƐ;ǁŝƚŚĂǁŽƌƐĞŶŝŶŐĚǇŶĂŵŝĐŽŶ'DsĐŽŵƉĂƌĞĚƚŽƌĞǀĞŶƵĞͿ͘>ŽŽŬŝŶŐĂŚĞĂĚƚŽϮϬϮϯ͕zŵŐŵƚĨƌĂŵĞĚĂĨĞǁŬĞǇŶĂƌƌĂƚŝǀĞƐ͗ƚŚĞǇǁŝůů
categories) toward broader platform evolution goals
ŵĂŶĂŐĞƚŚƌƵǁŚĂƚĞǀĞƌĞĐŽŶŽŵŝĐǀŽůĂƚŝůŝƚǇĐŽŵĞƐŝŶƚŽƉůĂǇŽǀĞƌƚŚĞĐŽŵŝŶŐƋƵĂƌƚĞƌƐǁŚŝůĞďĂůĂŶĐŝŶŐŬĞǇƉůĂƚĨŽƌŵŝŶǀĞƐƚŵĞŶƚƐ;ĞƐƉĞĐŝĂůůǇŝŶĨŽĐƵƐĐĂƚĞŐŽƌŝĞƐͿƚŚĂƚǁĞƌĞŚŝŐŚůŝŐŚƚĞĚĂƚƚŚĞĐŽŵƉĂŶǇ͛ƐŶĂůǇƐƚĂǇĂŶĚƐŚĂƌĞŚŽůĚĞƌƌĞƚƵƌŶƐŝŶƚŚĞĐŽŵŝŶŐϲͲϭϮŵŽŶƚŚƐ͘
in the coming quarters?
/ŶŝƚƐYϯ͚ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚͬĐĂůů͕'ŽŽĚZǆ;'ZyͿŵŐŵƚƐƚƌƵĐŬĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿƚŚĞYϯĞĂƌŶŝŶŐƐƌĞƉŽƌƚǁĂƐďƌŽĂĚůǇŝŶůŝŶĞƚŽďĞƚƚĞƌƚŚĂŶ'^ͬ^ƚƌĞĞƚĞƐƚŝŵĂƚĞƐĂƐƉƌĞƐĐƌŝƉƚŝŽŶƌĞǀĞŶƵĞĂŶĚŵĂƌŐŝŶƐ;ĚƌŝǀĞŶďǇĞĨĨŝĐŝĞŶĐŝĞƐĂŶĚƚŚĞďƌŽĂĚĞƌƌĞͲŽƌŐĂŶŝǌĂƚŝŽŶĞĨĨŽƌƚƐͿĂůůƉƌŽĚƵĐĞĚĂďĞƚƚĞƌƚŚĂŶ
expected result; 2) Q4 commentary reflected a continued series of headwinds from the grocer issue (that has plagued the company most of this year), marketing investments pressuring margins, subscription revenue being impacted by churn impact of price increases, & near-term headwinds
Will mgmt be able to strike a balance of continued
GoodRx GDRX Neutral $ 8 around pharma manufacturers solutions; & 3) continued optimism around the large addressable market opportunities around creating saving outcomes for the consumer. Shorter term, we expect the pathway (visibility) to more linear growth and margin narratives/performance will act as an
growth with long term margin expansion?
overhang on the shares in the current environment. Longer term, we still see GoodRx as an emerging multi-sided and multi-product platform that is delivering savings & conveniences to consumers and volumes to its industry partners in a fragmented end market (US healthcare) while also
producing a rare mix of high growth and strong margins over our 5 year forecast period.
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƉƌŝŶƚ͕ƚƐǇƉƌŽĚƵĐĞĚŽƉĞƌĂƚŝŶŐŵĞƚƌŝĐƐƚŚĂƚǁĞƌĞďƌŽĂĚůǇĂŚĞĂĚŽĨ'^ĞĂŶĚ^ƚƌĞĞƚĞǆƉĞĐƚĂƚŝŽŶƐǁŝƚŚĂͿYϯ'D^ĂƚƚŚĞŚŝŐŚͲĞŶĚŽĨŵŐŵƚ͘ΖƐƉƌŝŽƌŐƵŝĚĞ͕ďͿƌĞǀĞŶƵĞŽƵƚƉĂĐŝŶŐ'D^;ƐƵƉƉŽƌƚĞĚďǇƚĂŝůǁŝŶĚƐĨƌŽŵƚŚĞƌĞĐĞŶƚƚƐǇ͘ĐŽŵĐŽŵŵŝƐƐŝŽŶŝŶĐƌĞĂƐĞĂŶĚƚŚĞĐŽŶƚŝŶƵĞĚ
How much will elements of growing scale, momentum of its advertising offering), and c) a mixture of those high-margin revenue dollars and investment discipline helping deliver margin outperformance. Most importantly, mgmt.'s Q4'22 GMS guide of $3.6-4.0bn largely came-in above investor expectations, as sentiment had
Etsy ETSY Buy $ 130 diversification and product innovation translate into deteriorated in the weeks leading up to this earnings release on heightened macro concerns. In line with this dynamic, Etsy.com's GMS growth trends (vs. 2019) improved in October relative to Q3. Looking into 2023, mgmt. pointed to another quarter of difficult comps, as the earlier months of
levels of resiliency for GMS growth in 2023? the year compare to periods that benefited from COVID-related stay-at-home measures in 2022. On profitability, Etsy struck a balanced tone of largely having appropriately sized its investments against the opportunity ahead thus far, as hiring trends respond to changes in topline growth and as
employee productivity remains elevated, while also being explicit in not managing for a margin target in the periods ahead.
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƉƌŝŶƚ͕tĂǇĨĂŝƌƉƌŽĚƵĐĞĚƌĞƐƵůƚƐƚŚĂƚǁĞƌĞůĂƌŐĞůǇŝŶͲůŝŶĞǁŝƚŚ'^Ğͬ^ƚƌĞĞƚĞǆƉĞĐƚĂƚŝŽŶƐŝŶƚĞƌŵƐŽĨƌĞǀĞŶƵĞŐƌŽǁƚŚĂŶĚĚũ͘/důŽƐƐĞƐ͘,ŽǁĞǀĞƌ͕ƚŚĞĐŽŵƉĂŶǇĚĞůŝǀĞƌĞĚĂƉŽƐŝƚŝǀĞƐƵƌƉƌŝƐĞŝŶƚĞƌŵƐŽĨŝƚƐĐŽŵŵĞŶƚĂƌǇĂƌŽƵŶĚƚŚĞĞǆƉĞĐƚĞĚĨŽƌǁĂƌĚƉƌŽĨŝƚĂďŝůŝƚǇƉƌŽĨŝůĞŝŶƚŽ
Will ongoing category and industry headwinds
2023, as mgmt laid-out a $500mm expense reduction program (roughly equal to the annualized Adj. EBITDA loss seen in Q3'22), supporting expectations of a return to positive Adj. EBITDA over the course of the year. In the meantime, the operating environment remains challenging (both for
Wayfair W Neutral $ 40 ŝŵƉĂĐƚtĂǇĨĂŝƌ͛ƐĂďŝůŝƚǇƚŽƌĞĂĐŚĚũ͘/d
Wayfair and for the broader online Home category), as active customers declined by -23% YoY in Q3'22 (roughly in line with the declines seen in Q2'22) and as visibility remains low regarding the timing of a return to positive order growth, illustrated by unpaid customer acquisition remaining
profitability in 2023?
under pressure (from ongoing category weakness) and by a slower start to Q4'22 outside of Way Day 2 (with gross revenues ex-Way Day 2 trending -10% YoY quarter-to-date).
For its Q3'22 results, ThredUP reported revenue growth and Adj. EBITDA losses that were ahead of the midpoint of its previously guided range. However, the company's forward outlook painted a less favorable picture, as mgmt lowered its growth and profitability expectations for Q4'22, with
revenue and Adj. EBITDA both landing well below prior GSe/Street (FactSet) estimates. This downward revision was driven by a more challenging operating environment than previously anticipated, as macro headwinds continued to impact the business (disproportionately affecting TDUP's
Can thredUP align revenue and expense growth to
budget consumers), and as the apparel category became sharply more promotional, which compressed average order values (with Q3'22 orders +24% YoY vs. revenue +7% YoY), pressured contribution margins (due to lower prices), and reduced the relative value proposition of TDUP's resale
thredUp TDUP Neutral $ 2 execute against its target to reach Adj. EBITDA
platform (as lower-priced deals became more widely available). As we look towards 2023, those headwinds translate into expectations that revenue growth will be largely flat in 1H23, with mgmt. expecting a reacceleration in 2H23, driven by anticipations of a more normalized promotional
profitability by the end of 2023?
environment and of higher levels of growth investments if that healthier backdrop were to materialize. Despite those revenue headwinds, ThredUP reiterated its target to achieve quarterly Adj. EBITDA breakeven by 2H23, which remains framed around the achievement of a ~$80-85m quarterly
revenue run-rate.
Streaming Media & Subscription Services

EĞƚĨůŝǆƌĞƉŽƌƚĞĚĂƐŽůŝĚYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚĚƌŝǀĞŶďǇďĞƚƚĞƌƚŚĂŶĞǆƉĞĐƚĞĚƐƵďƐĐƌŝďĞƌŶĞƚĂĚĚƐĂŶĚ;ǁŚĞŶĂĚũƵƐƚĞĚĨŽƌĨͬǆŚĞĂĚǁŝŶĚƐͿĂƐŽůŝĚƐĞƚŽĨŽƉĞƌĂƚŝŶŐƉĞƌĨŽƌŵĂŶĐĞĂŐĂŝŶƐƚƌĞǀĞŶƵĞŐƌŽǁƚŚĂŶĚŽƉĞƌĂƚŝŶŐŵĂƌŐŝŶƐ͘ŚĞĂĚŽĨϮϬϮϯ͕ǁĞĞǆƉĞĐƚƚŚĞŶĂƌƌĂƚŝǀĞƚŽƐŚŝĨƚƚŽǁĂƌĚŵĂŶĂŐĞŵĞŶƚ
How will subscriber growth trend in the coming
execution against rolling out the new ad supported tier and password sharing restrictions in terms of a mixture of driving subscriber growth and re-accelerating revenue growth in 2023. While investor optimism is built with respect to the ad supported tier (correlated with the recent stock
quarters as Netflix continues to invest in the ad-
Netflix NFLX Sell $ 200 outperformance in the run-up to Q3 earnings), we still see an elevated competitive industry level against a post-pandemic backdrop while a potential for a weaker consumer spending dynamic remains into 2023. We agree that both of those options have the potential to either open up avenues
supported tier midst a competitive streaming media
of new subscriber growth and/or higher margin revenue dollars based on opening up or capitalizing on market opportunities. Looking long term, it will be any successful execution on those initiatives that would likely cause Netflix to sustain its recent reversal of pronounced stock
environment?
underperformance over the past 12 months.
WĞůŽƚŽŶΖƐϭ&YϮϯĞĂƌŶŝŶŐƐƌĞƉŽƌƚǁĂƐĚŽŵŝŶĂƚĞĚďǇĂĚƵĂůŶĂƌƌĂƚŝǀĞʹϭͿůŽǁĞƌͲƚŚĂŶͲĞǆƉĞĐƚĞĚƌĞǀĞŶƵĞĂŶĚƐƵďƐĐƌŝďĞƌĚǇŶĂŵŝĐƐĂƐƚŚĞƉůĂƚĨŽƌŵĐŽŶƚŝŶƵĞƐƚŽĨĂĐĞŚĞĂĚǁŝŶĚƐ;ŝ͘Ğ͕͘ƉŽƐƚƉĂŶĚĞŵŝĐ͕ĐŽŶƐƵŵĞƌƐƉĞŶĚͿĂŶĚĂƐƚŚĞĐŽŵƉĂŶǇĂǁĂŝƚƐĂƌĞƐƵŵƉƚŝŽŶŽĨŐƌŽǁƚŚƚŽďƵŝůĚƌĞǀĞŶƵĞƐĐĂůĞĂŐĂŝŶƐƚ
its restructuring; & 2) solid progress in its restructuring efforts with Adj EBITDA coming in better than expected this quarter and the forward guide better than our prior forecasts. In addition, the company continues to diversify its approaches to stimulate growth by adding retail/eCommerce
,ŽǁǁŝůůWĞůŽƚŽŶ͛ƐƐƵďƐĐƌŝďĞƌďĂƐĞΘƌĞǀĞŶƵĞ
ĚŝƐƚƌŝďƵƚŝŽŶƐ;ŵĂǌŽŶ͕ŝĐŬ͛ƐͿĂŶĚŚĂǀŝŶŐƐŽŵĞĞĂƌůǇƐƵĐĐĞƐƐǁŝƚŚƚŚĞ&ŝƚŶĞƐƐĂƐĂ^ĞƌǀŝĐĞŽĨĨĞƌŝŶŐ͘>ŽŶŐĞƌƚĞƌŵ͕WdKEŵŐŵƚƌĞŵĂŝŶƐĐŽŶǀŝĐƚĞĚŝŶƚŚĞĂĚĚƌĞƐƐĂďůĞŵĂƌŬĞƚŽƉƉŽƌƚƵŶŝƚǇĂƐƚŚĞǇƉŽƐŝƚŝŽŶƚŚĞŚĂƌĚǁĂƌĞͬƐŽĨƚǁĂƌĞƐƚƌĂƚĞŐǇƚŽǁĂƌĚĂ͞ŐŽŽĚ͕ďĞƚƚĞƌ͕ďĞƐƚ͟ĂƉƉƌŽĂĐŚƚŽŵĂƌŬĞƚ
Peloton PTON Neutral $ 12 growth trend in the coming quarters post-COVID
segmentation as they aim to move beyond turnaround mode and drive medium-/long-term revenue growth. For the second earnings call in a row, we believe that PTON mgmt has executed well on positioning the company to right size opex/capex and the strategic positioning for a post COVID
against the backdrop of new pricing strategies?
ǁŽƌůĚ͘'ŽŝŶŐĨŽƌǁĂƌĚ͕ǁĞǁŝůůďĞŵŽŶŝƚŽƌŝŶŐĨŽƌƐŝŐŶƐŽĨĂŵŝǆŽĨŝŵƉƌŽǀĞĚŐƌŽǁƚŚ;ŐƌŽƐƐĂĚĚƐ͕ŵĂƌŬĞƚƐĞŐŵĞŶƚĂƚŝŽŶ͕ŶĞǁƉƌŽĚƵĐƚƐͿĂŶĚͬŽƌůŝŶĞĂƌŵĂƌŐŝŶĂŶĚ&&ƚƌĂũĞĐƚŽƌǇďĞǇŽŶĚ&zϮϯʹǁĞďĞůŝĞǀĞǀŝƐŝďŝůŝƚǇŝŶƚŽďĞƚƚĞƌŐƌŽǁƚŚŶĂƌƌĂƚŝǀĞƐŝƐůŝŬĞůǇŬĞǇƚŽĚƌŝǀĞƌĞŶĞǁĞĚŝŶǀĞƐƚŽƌŝŶƚĞƌĞƐƚŝŶƚŚĞ
stock.
abf1713081cf4bd28921692cb124a462
^ƉŽƚŝĨǇ͛ƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚǁĂƐŐĞŶĞƌĂůůǇŝŶůŝŶĞǁŝƚŚ'^ͬ^ƚƌĞĞƚĞƐƚŝŵĂƚĞƐĂƐƚŚĞĐŽŵƉĂŶǇĐŽŶƚŝŶƵĞƐƚŽƐĞĞƐƚƌŽŶŐŵŽŵĞŶƚƵŵŝŶŝƚƐƐƵďƐĐƌŝďĞƌĨƵŶŶĞů;ďĞĂƚŽŶYϯDhƐĂŶĚďĞƚƚĞƌƚŚĂŶĞǆƉĞĐƚĞĚYϰDhŐƵŝĚĞͿĂŶĚƐůŝŐŚƚƉƌĞƐƐƵƌĞŝŶƚĞƌŵƐŽĨĂĚͲƐƵƉƉŽƌƚĞĚƌĞǀĞŶƵĞĂƐĂƌĞƐƵůƚŽĨƚŚĞ
How will management's execution against future
broader macroeconomic environment. In total, we thought the SPOT mgmt team struck a few key themes in terms of the earnings call: 1) continued optimism in the broader subscriber funnel in terms of both MAUs and the conversion into premium subscriber net adds across all global regions;
growth opportunities (advertising, podcasting, two-
2) mix of f/x headwinds and ad-supported weakness as impacting the gross margin trajectory against a broader theme of 2022 being an investment year for the long-term; 3) mgmt expressed confidence in their long-term margin profile; & 4) mgmt struck a tone on balancing investments over
Spotify SPOT Neutral $ 114 sided marketplace, etc.) translate into subscriber
the short/medium term in light of what remains a volatile macro environment (including increased capital costs). Looking forward, we expect the key investor debates to remain focused on: 1) the potential for any impacts from volatile macroeconomic conditions (especially on advertising
growth & gross margin trajectory over the next 12-
revenue in the next 6-9 months) and 2) more evidence as to how recession resilient the streaming audio industry is in a challenged consumer environment. Looking beyond any short-term economic dynamics, we still remain focused on proof points of sustained topline growth (mgmt framing
24 months?
20% revenue CAGR at the analyst day) with a rising gross margin profile (as investments scale into yielded platform dynamics) as the two key unlocks toward becoming more constructive on SPOT shares from current levels.
Source: Company data, FactSet, Goldman Sachs Global Investment Research
18 November 2022 9
Exhibit 9: Key Debates & Our View - Online Education & Online Marketplaces
Online Education
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕ŚĞŐŐŵŐŵƚƐƚƌƵĐŬŽŶĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿƉŽƐŝƚŝǀĞŵŽŵĞŶƚƵŵĂĐƌŽƐƐĐŽƌĞƉƌŽĚƵĐƚƐ;ǁŝƚŚĂďĞƚƚĞƌƚŚĂŶĞǆƉĞĐƚĞĚĞŶƌŽůůŵĞŶƚďĂĐŬĚƌŽƉŝŶƚĞƌŵƐŽĨĐŽůůĞŐĞĞĚƵĐĂƚŝŽŶͿĂĐƚĞĚĂƐĂƉŽƐŝƚŝǀĞĐĂƚĂůǇƐƚĨŽƌďŽƚŚĐŽŶǀĞƌƐŝŽŶƌĂƚĞƐĂŶĚƚĂŬĞƌĂƚĞƐ͖ϮͿ
How will management balance
ƚŚĞĐŽŵƉĂŶǇƐƵĐĐĞƐƐĨƵůůǇĞǆĞĐƵƚĞĚŽŶŝƚƐƐƵŵŵĞƌƉƌŝĐŝŶŐĐŚĂŶŐĞƐǁŝƚŚŶŽĚŝƐĐĞƌŶŝďůĞŝŵƉĂĐƚŽŶĞůĞŵĞŶƚƐŽĨŐƌŽƐƐƵƐĞƌŐƌŽǁƚŚĂŶĚͬŽƌĐŚƵƌŶĚǇŶĂŵŝĐƐʹƚŚĞĐŽŵďŽŽĨƉƌŝĐŝŶŐƉůĂŶƐŶŽǁůĞĂǀĞƐƚŚĞĐŽŵƉĂŶǇǁĞůůƉŽƐŝƚŝŽŶĞĚƚŽĂĚĚƌĞƐƐĂƉŽƚĞŶƚŝĂůůǇǁŝĚĞƌĂƌƌĂǇŽĨƐƚƵĚĞŶƚ
momentum across products and
Chegg CHGG Neutral $ 24 needs in the coming years; 3) some optimism that summer school trends could bode well for the fall college term; 4) solid margin expansion while still maintaining a healthy investment pace; & 5) early positive commentary on the Busuu (language learning) opportunity
subscriber growth with margin
in the coming quarters/years. Looking longer term, we see Chegg as a direct-to-student online learning platform that delivers a range of content (primarily via subscription) to ~7.8mm students, against a TAM of ~100mm. We see the company having a potential runway
expansion?
to grow its subscriber base as students look for more affordable and accessible academic support.
ŽƵƌƐĞƌĂ͛ƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚĚĞŵŽŶƐƚƌĂƚĞĚƐƚƌĞŶŐƚŚŝŶƚŚĞŝƌĐŽŶƐƵŵĞƌΘĞŶƚĞƌƉƌŝƐĞƐĞŐŵĞŶƚǁŚŝůĞĚĞŐƌĞĞƐĐŽŶƚŝŶƵĞĚƚŽĨĂĐĞĐŚĂůůĞŶŐĞƐŐŝǀĞŶĞŶƌŽůůŵĞŶƚƚƌĞŶĚƐƉĂƌƚŝĐƵůĂƌůǇŝŶƚŚĞh^;ǁŚĞƌĞŽƵƌƐĞƌĂŽǀĞƌͲŝŶĚĞǆĞƐͿ͘tŚŝůĞŽƵƌƐĞƌĂĂůƐŽƐŚŽǁĞĚĂƐƚƌŽŶŐďĞĂƚŽŶ
How will investment in new product margins in the quarter, management reiterated its investment framework of re-investing into areas where they see an opportunity to better position the company for the long-term, but still progressing towards its full-year margin target laid out in February. With this
offerings evolve and fuel growth in ĞĂƌŶŝŶŐƐƉƌŝŶƚ͕ǁĞǀŝĞǁŽƵƌƐĞƌĂ͛ƐƐƚƌŽŶŐYϯƚŽƉůŝŶĞƌĞƐƵůƚƐĂƐƉƌŽǀŝĚŝŶŐĐŽŵĨŽƌƚĂƌŽƵŶĚƚŚĞƌĞůĂƚŝǀĞůǇĨůĂƚYϰŐƵŝĚĞďƵƚĞǆƉĞĐƚŽƉĞŶƋƵĞƐƚŝŽŶƐƚŽƌĞŵĂŝŶĂƌŽƵŶĚĞǆŝƚǀĞůŽĐŝƚǇĨŽƌϮϬϮϮŝŶƚŽϮϬϮϯ;ĞƐƉĞĐŝĂůůǇŐŝǀĞŶƚŚĞĐǇĐůŝĐĂůͬĐŽƵŶƚĞƌͲĐǇĐůŝĐĂůŝƚǇĐŽŵƉŽŶĞŶƚƐŽĨƚŚĞǀĂƌŝŽƵƐ
Coursera COUR Neutral $ 14
the 3 core segments over the next 12- revenue segments). Against the broader market environment (where investors are placing higher value on the long-tailed profit narrative over near-to-medium term topline performance), we expect investors to focus on the arch & scale of investments with Q4 being a
24 months? ŬĞǇƐŝŐŶƉŽƐƚĂƌŽƵŶĚŽƵƌƐĞƌĂ͛ƐƉĂƚŚƚŽƉƌŽĨŝƚĂďŝůŝƚǇ͘>ŽŶŐĞƌƚĞƌŵ͕ǁĞǀŝĞǁŽƵƌƐĞƌĂŝŶĂƵŶŝƋƵĞƉŽƐŝƚŝŽŶƚŽďĞŶĞĨŝƚĨƌŽŵƚŚĞŐƌŽǁŝŶŐĚĞŵĂŶĚĨŽƌŐůŽďĂůĞĚƵĐĂƚŝŽŶĂŶĚŝƐĂďůĞƚŽĐŽŶǀĞƌƚŝƚƐůĂƌŐĞĨƌĞĞŵŝƵŵƵƐĞƌďĂƐĞŝŶƚŽĐƵƐƚŽŵĞƌƐĨŽƌŝƚƐŚŝŐŚĞƌŵĂƌŐŝŶĂŶĚŚŝŐŚĞƌ
revenue visibility Enterprise and Degrees products.
,ŽǁǁŝůůƵŽůŝŶŐŽ͛ƐƵƐĞƌďĂƐĞĂŶĚ /ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕ƵŽůŝŶŐŽ;hK>ͿŵŐŵƚĨŽĐƵƐĞĚŽŶĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿƵƉƐŝĚĞƚŽƋƵĂƌƚĞƌůǇĞƐƚŝŵĂƚĞƐŝŶYϯŽŶƵƐĞƌ͕ďŽŽŬŝŶŐƐ͕ĂŶĚƌĞǀĞŶƵĞƐƚƌĞŶŐƚŚǁŝƚŚŵŐŵƚŚŝŐŚůŝŐŚƚŝŶŐŽǀĞƌĂůůƉŽƐŝƚŝǀĞŽƉĞƌĂƚŝŶŐƚƌĞŶĚƐŝŶƚŽƚŚĞϮ,͛ϮϮĂŶĚŝŶƚŽϮϬϮϯ;ĂƐƐƚƌŽŶŐƵƐĞƌ
growth should translate into paid conversion and strong bookings growth); 2) while remaining in investment mode, DUOL outperformed in terms of both Q3 (& projected Q4) Adj EBITDA as scale in the platform continues to build leverage as the company remains in a
paid subscribers evolve in the coming
Duolingo DUOL Neutral $ 92 years as Duolingo invests behind low marketing position with innovative partnerships driving user growth in a cost effective manner (e.g., House of Dragon campaign costing ~$150k); & 3) the company remains focused on innovation (A/B testing, product launches, pricing tests and new verticals) as a
product innovation and enter new means of compounded forward growth. Over the short-term, we see investor debates focused on sustainable levels of forward user growth, payer conversion potential, the path to profitability (as R&D investments cont. to weigh on margins), and whether the growth
verticals? opportunities are priced in at current levels. Longer term, we see DUOL as a leader in the global language learning market with users, engagement, and monetization well above that of its direct competitors. The company's freemium model, which generates revenue
primarily from paid subscriptions and ads served to free users, is disrupting the $61bn language learning market, only 20% of which is currently online and a substantially lower percentage currently on mobile.
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕EĞƌĚǇŵĂŶĂŐĞŵĞŶƚĨŽĐƵƐĞĚŽŶĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿ>ĞĂƌŶŝŶŐDĞŵďĞƌƐŚŝƉƐ;ĂŬĞǇƐƚƌĂƚĞŐŝĐƐŚŝĨƚĨŽƌƚŚĞĐŽŵƉĂŶǇͿƐĂǁƉŽƐŝƚŝǀĞĞĂƌůǇƚƌĂĐƚŝŽŶŝŶƚĞƌŵƐŽĨƵƉƚĂŬĞďǇƐƚƵĚĞŶƚƐĂŶĚĞǆƉƌĞƐƐĞĚŽƉƚŝŵŝƐŵŽŶůŽŶŐͲƚĞƌŵůŝĨĞƚŝŵĞǀĂůƵĞĞĨĨĞĐƚŽŶ
How quickly will NRDY's institutional customers; 2) re-alignment of resources in favor of the Learning Membership model and efforts around scaling the salesforce for the Institutional business; 3) observed some seasonal weakness from summer travel; & 4) narrowed the Q4 revenue guidance down to
efforts scale? How successful will reflect a mix of a pushout on some of the ramp in terms of the Institutional business (given longer lead times with potentially large scaled customers) as well as a timing impact from the shift to the Learning Membership model as it has exceeded expectations to date. In
Nerdy NRDY Neutral $ 3
their move to a customer the short-term, we expect NRDY shares to remain volatile to the levels and cadence of mgmt execution against these product/platform transitions in the coming quarters (especially an initial framing of growth and cadence for 2023). Looking long term, we still see
membership offering be? Nerdy as well-positioned to benefit from a few key themes: 1) various secular tailwinds supportive of forward growth for both DTC business and Institutional opportunity; 2) platform-based approach competitively positions Nerdy in a fragmented market; & 3) potential
for significant operating leverage long term.
Online Marketplaces
tŝůůsďĞĞǆĞĐƵƚĞĂŐĂŝŶƐƚǁŚĂƚ͛Ɛ
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕sƵĐƚŝŽŶƐ;sͿĨŽĐƵƐĞĚŽŶĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿǁŚŝůĞƚŚĞŽǀĞƌĂůůĞŶĚŵĂƌŬĞƚĞŶǀŝƌŽŶŵĞŶƚƌĞŵĂŝŶƐĐŚĂůůĞŶŐŝŶŐ͕sĐŽŶƚŝŶƵĞƐƚŽĚĞŵŽŶƐƚƌĂƚĞƐŚĂƌĞŐĂŝŶƐŝŶƚŚĞǁŚŽůĞƐĂůĞŵĂƌŬĞƚĂŶĚŝƐŝŵƉƌŽǀŝŶŐŝƚƐƌĞůĂƚŝǀĞƉŽƐŝƚŝŽŶŝŶŐĨŽƌƚŚĞ
in their control to drive market share
eventual demand recovery; 2) macro headwinds persist with a mixture of a weakening consumer/retail demand, slightly improving (though still less than normal) OEM new car supply & overall lower conversion rates; & 3) while mgmt has taken steps to drive cost
ACV gains (both in term of dealer
Auctions
ACVA Buy $ 12 efficiency in the PnL (& reiterated LT Adj. EBITDA targets), there remains a focus on investing against the long-term opportunity (focused on product/technology enablement to differentiate the platform in coming years). In our view, ACVA has a long runway to grow
expansion & share of wallet) despite
against a few key themes: 1) the secular shift of dealer-to-dealer/wholesale auto sales moving from offline to digital; 2) the fragmentation of the market in which they operate; 3) territory expansion, scaling in existing territories and increasing wallet share of customers
broader macro dynamics weighing on
& 4) product & service innovation through technology, which leads to stickier relationships with marketplace participants and upside to the revenue opportunity.
broader autos inudstry?
How will management balance a /ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕&ŝǀĞƌƌ;&sZZͿƐƚƌƵĐŬĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ĂͿƌĞǀĞŶƵĞŚĂĚƐůŝŐŚƚƵƉƐŝĚĞǀƐ͘'^ͬ^ƚƌĞĞƚ;&ĂĐƚƐĞƚͿĞƐƚŝŵĂƚĞƐŽŶĂŶŝŶůŝŶĞ'DsŽƵƚĐŽŵĞ;ĚƌŝǀĞŶďǇƐƚƌŽŶŐĞƌͲƚŚĂŶͲĞǆƉĞĐƚĞĚĂŶŶƵĂůĂĐƚŝǀĞďƵǇĞƌƐͿďƵƚŚŝŐŚĞƌƚĂŬĞƌĂƚĞʹŵŐŵƚƐƚƌƵĐŬĂĐŽŶƐƚƌƵĐƚŝǀĞƚŽŶĞ

mixture of investments for the on the long-term growth opportunity but a more muted tone on headwinds the business is facing in Q4 & into 2023 from macroeconomic dynamics; 2) solid Adj. EBITDA performance & forward guide as mgmt focused on driving a higher degree of efficiencies (platform
Fiverr FVRR Neutral $ 33 structural growth opportunity ƐĐĂůĞΘŵĂƌŬĞƚŝŶŐƌĞƚƵƌŶƐͿŝŶƚŚĞϮ,͛ϮϮ͕ǁŚŝĐŚďŽĚĞƐǁĞůůĨŽƌŵĂƌŐŝŶƉƌŽŐƌĞƐƐŝŽŶŝŶϮϬϮϯĂŶĚďĞǇŽŶĚ͖ΘϯͿŵŐŵƚƌĞŵĂŝŶƐĨŽĐƵƐĞĚŽŶŵŽǀŝŶŐΗƵƉŵĂƌŬĞƚΗŝŶƚĞƌŵƐŽĨĐůŝĞŶƚƐƉĞŶĚĂŶĚƉŽŝŶƚƐƚŽ&ŝǀĞƌƌƵƐŝŶĞƐƐĂƐĂŬĞǇŝŶŝƚŝĂƚŝǀĞĂŝŵĞĚĂƚƚŚĂƚŐŽĂů͘/ŶƚŚĞƐŚŽƌƚƚĞƌŵ͕ǁĞ
against near-term demand ĞǆƉĞĐƚƚŚĞŽǀĞƌĂůůŵĂĐƌŽĞŶǀŝƌŽŶŵĞŶƚĨŽƌƐĞƌǀŝĐĞƐ͕ĂĐƚŝǀĞďƵǇĞƌŐƌŽǁƚŚYŽYŝŵƉůŝĞĚďǇŵĂŶĂŐĞŵĞŶƚĐŽŵŵĞŶƚĂƌǇΘĐůŝĞŶƚƐƉĞŶĚŝŶŐĂĐƚŝǀŝƚǇǁŝůůƌĞŵĂŝŶƚŽƉŽĨŵŝŶĚƚŚƌŽƵŐŚYϰ͛ϮϮĂŶĚŝŶƚŽƚŚĞŝŶŝƚŝĂůŐƵŝĚĞĨŽƌϮϬϮϯ͘KǀĞƌƚŚĞůŽŶŐƚĞƌŵ͕ǁĞƐĞĞ&sZZĂƐĂůĞĂĚŝŶŐŐůŽďĂů
headwinds & macro uncertainty? online freelance marketplace in an end market that remains relatively early in the penetration of its overall TAM.
Will management successfully /ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕'ƌŽƵƉŽŶŵŐŵƚƐƚƌƵĐŬĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿŵŐŵƚ͛ƐŵĂŝŶĨŽĐƵƐƌĞŵĂŝŶƐŽŶƌĞĚƵĐŝŶŐƚŚĞĐŽƐƚƐƚƌƵĐƚƵƌĞďŽƚŚƚŚƌƵϮϬϮϯĂŶĚŝŶƚĞƌŵƐŽĨϮϬϮϯĞǆŝƚǀĞůŽĐŝƚǇǁŚŝůĞĂůƐŽƌĞͲƉŽƐŝƚŝŽŶŝŶŐƚŚĞƉůĂƚĨŽƌŵĨŽƌŵĞĚŝƵŵͬůŽŶŐƚĞƌŵŐƌŽǁƚŚ͖ϮͿĐŽŶƚŝŶƵŝŶŐƚŽ

execute on their turnaround strategy ŝŶǀĞƐƚŝŶĂŚŽƐƚŽĨŝŶŝƚŝĂƚŝǀĞƐĂƌŽƵŶĚƌĞĚƵĐŝŶŐƉƵƌĐŚĂƐŝŶŐĨƌŝĐƚŝŽŶ͕ĂĚĚŝŶŐƐƵƉƉůǇĚĞŶƐŝƚǇĂŶĚƌĞͲƉŽƐŝƚŝŽŶŝŶŐƚŚĞƉůĂƚĨŽƌŵĨŽƌŬĞǇĐĂƚĞŐŽƌŝĞƐʹǁŝƚŚĂĨŽĐƵƐŽŶƌĞƐƚƌƵĐƚƵƌŝŶŐƚŚĞƐĂůĞƐĨŽƌĐĞĂŶĚĚƌŝǀŝŶŐƐƵƉƉůǇĚŝĨĨĞƌĞŶƚŝĂƚŝŽŶ͖ΘϯͿƌĞŝƚĞƌĂƚŝŶŐϮϬϮϯƚĂƌŐĞƚƐŽŶ&&ĂŶĚĚũ
Groupon GRPN Sell $ 6.50
and deliver on both topline and Adj EBITDA margins. Short term, we would expect investor debates to remain squarely on the cadence of operating performance in the current industry environment while monitoring any progress on forward growth and their initiatives in the coming quarters. Longer term,
EBITDA targets? we see Groupon as strategically focused on growing their local experience offering; however, open questions remain around future performance for the business that are both idiosyncratic (new management team that is repositioning the company) and macro driven.
Can ROVR successfully grow topline
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕ZŽǀĞƌ;ZKsZͿŵŐŵƚĨƌĂŵĞĚĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿƌĞƉŽƌƚĞĚĂƐƚƌŽŶŐYϯƌĞǀĞŶƵĞƌĞƐƵůƚĚƌŝǀĞŶďǇŚŝŐŚĞƌĂǀĞƌĂŐĞďŽŽŬŝŶŐǀĂůƵĞĞƐƉĞĐŝĂůůǇǁŚĞŶŵĞĂƐƵƌĞĚĂŐĂŝŶƐƚĨĞĂƌƐŽĨĂƉŽƚĞŶƚŝĂůƐůŽǁĚŽǁŶůĂƐƚƋƵĂƌƚĞƌǁŝƚŚĐĂŶĐĞůůĂƚŝŽŶƌĂƚĞƐĂůƐŽ
against a backdrop of
surprising to the upside; 2) framed solid progress on marketing initiatives with renewed focus on video/social media channels (which might position the company for increased growth narrative long-term); & 3) continued focus on a large International opportunity with
macroeconomic uncertainty and
Rover ROVR Neutral $ 4.50 ŵƵůƚŝƉůĞǇĞĂƌƐŽĨŐƌŽǁƚŚ;ĂƐĞǀŝĚĞŶĐĞĚďǇƉŽƐŝƚŝǀĞĐŽŵŵĞŶƚƐŽŶŝŶƚĞƌŶĂƚŝŽŶĂůŽƉĞƌĂƚŝŽŶƐǁŝƚŚƚŚŝƐĞĂƌŶŝŶŐƐƌĞƐƵůƚͿ͘/ŶƚŚĞƐŚŽƌƚƚĞƌŵ͕ǁĞĞǆƉĞĐƚƚŚĞŵĂŝŶŝŶǀĞƐƚŽƌĚĞďĂƚĞƚŽďĞĐĞŶƚĞƌĞĚĂƌŽƵŶĚŚŽǁZŽǀĞƌ͛ƐŵĂƌŬĞƚƉůĂĐĞǁŝůůŽƉĞƌĂƚĞŝŶĂǀŽůĂƚŝůĞŵĂĐƌŽĞĐŽŶŽŵŝĐ
abf1713081cf4bd28921692cb124a462
balance supply and demand while
environment (especially into early 2023). Longer term, we still see Rover as a well-positioned two-sided marketplace for online pet care that connects pet parents with pet care providers across North America and Europe servicing ~3mm households on the demand side
expanding on the international
ĂŶĚΕϲϲϬŬƐĞƌǀŝĐĞƉƌŽǀŝĚĞƌƐŽŶƚŚĞƐƵƉƉůǇƐŝĚĞƚŽĚĂƚĞʹĂŶĚŵĂŶǇŽĨƚŚŽƐĞƉŽƐŝƚŝǀĞĚǇŶĂŵŝĐƐǁĞƌĞŽŶĚŝƐƉůĂǇǁŝƚŚƚŚŝƐĞĂƌŶŝŶŐƐƌĞƐƵůƚ͘
oppty?
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚĂŶĚĨŽƌǁĂƌĚĐŽŵŵĞŶƚĂƌǇ͕hƉǁŽƌŬĨƌĂŵĞĚƚŚĞŵĂĐƌŽĞŶǀŝƌŽŶŵĞŶƚĂƐĐŚĂůůĞŶŐŝŶŐ;ƐŽĨƚĞƌĐůŝĞŶƚĂĐƋƵŝƐŝƚŝŽŶΘƌĞƚĞŶƚŝŽŶǁͬĞůŽŶŐĂƚĞĚƐĂůĞƐĐǇĐůĞƐͿďƵƚŶŽƚŶĞĐĞƐƐĂƌŝůǇŐĞƚƚŝŶŐǁŽƌƐĞĂŶĚĐĞƌƚĂŝŶŽƉĞƌĂƚŝŽŶĂůŚĞĂĚǁŝŶĚƐƚŚĂƚƐŚŽƵůĚĞĂƐĞ
How will management balance a incrementally as we move into Q4 and beyond. While the operating environment remains uncertain, with a likely wide range of potential outcomes in 2023, management remains focused on investing against the structural growth opportunity ahead of them around
mixture of investments for the enterprises shifting towards flexible labor pools. This includes continuing to invest in brand to drive awareness of the platform, go-to-market/salesforce against the broader land & expand strategy, and product innovation to deepen its value proposition for both clients
Upwork UPWK Buy $ 24
structural growth opportunity & talent. Structurally, we still frame Upwork across a few key themes: 1) executing against a large and growing TAM as the future of work evolves and companies look to adopt hybrid workforces in the future (i.e. performance labor where costs can be flexed with the
against near-term demand softness? current operating environment, deployed real-time & in certain cases having measurable ROI on productivity of labor spend); 2) continuing to scale both the talent/freelancer and client side of the platform (including growing GSV per client); 3) continued product
innovation to drive adoption, retention & share of wallet; and 4) investing in the brand to drive improving unaided brand awareness.
How long will recent pricing /ŶŝƚƐYϯ͚ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕yŽŵĞƚƌǇ;yDdZͿŵŐŵƚĨŽĐƵƐĞĚŽŶĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿƐŽůŝĚYϯƌĞǀĞŶƵĞďƵƚǁŝƚŚYϰƌĞǀĞŶƵĞŐƵŝĚĞŝŵƉĂĐƚĞĚďǇƌĞĐĞŶƚĚŽǁŶǁĂƌĚŶŽĚĞŝŶĂůŐŽͲĚƌŝǀĞŶƉƌŝĐŝŶŐŽŶƚŚĞƉůĂƚĨŽƌŵʹĂƚŚĞŵĞƚŚĂƚƐŚŽŽŬƐŽŵĞŽĨƚŚĞŐƌŽǁƚŚŶĂƌƌĂƚŝǀĞĂƌŽƵŶĚƚŚĞ

headwinds remain and to what stock (which until today had outperformed against growing investor growth fears); 2) continued progress on integration and platforming initiatives stemming from the Thomas acquisition; 3) remaining in investment mode across AI/ML and building scale on a global
Xometry XMTR Buy $ 57 extent will the company be able to basis (but with mgmt commentary increasingly about gross/operating margin leverage as scale compounds). Short term, we think investors will remain focused on this pricing headwind and/or whether the demand environment (buyer growth or spend per buyer) will
outrun any potential macro slow as a result of any changes in the macro environment. Looking long term, we view Xometry as a leader in the online B2B marketplace space connecting businesses with manufacturers of industrial parts, addressing a $2.4tn TAM (per the company). Its platform
slowdown? ƵƚŝůŝǌĞƐƚĞĐŚŶŽůŽŐǇƚŽŝŶƐƚĂŶƚĂŶĞŽƵƐůǇƉƌŝĐĞďƵǇĞƌŽƌĚĞƌƐĂŶĚƉƌĞƐĞŶƚƚŚŽƐĞŽƌĚĞƌƐƚŽĂŶĞƚǁŽƌŬŽĨŝŶĚƵƐƚƌŝĂůƉĂƌƚƐŵĂŶƵĨĂĐƚƵƌĞƌƐʹƚŚŝƐĚǇŶĂŵŝĐ͕ŝŶŽƵƌǀŝĞǁ͕ǁŝůůƉƌŽĚƵĐĞĂƌƵŶǁĂǇĨŽƌŐƌŽǁƚŚĂŶĚŵĂƌŐŝŶĞǆƉĂŶƐŝŽŶŝŶƚŚĞĐŽŵŝŶŐǇĞĂƌƐ͘
/ŶŝƚƐYϯ͛ϮϮĞĂƌŶŝŶŐƐƌĞƉŽƌƚ͕ŝƉZĞĐƌƵŝƚĞƌ;/WͿŵŐŵƚƐƚƌƵĐŬĂĨĞǁŬĞǇƚŚĞŵĞƐ͗ϭͿƐƚƌŽŶŐŵĂƌŬĞƚƉůĂĐĞĚǇŶĂŵŝĐƐ;ĚƌŝǀĞŶďǇƐƵƐƚĂŝŶĞĚƐƚƌŽŶŐĚĞŵĂŶĚΘƉƌŝŽƌƉĞƌŝŽĚŝŶǀĞƐƚŵĞŶƚƐŝŶƉƌŽĚƵĐƚĂŶĚŵĂƚĐŚŝŶŐƚĞĐŚͿĚĞŵŽŶƐƚƌĂƚĞĚǇŝĞůĚƐŝŶƚĞƌŵƐŽĨƌĞǀĞŶƵĞƵƉƐŝĚĞ;ǁŝƚŚŵŐŵƚ
Will ZIP be able to successfully pivot
commentary even guiding ahead of GSe/Street for Q4); 2) continued reiteration of key investment priorities (growing scale of employers) and the scope of the opportunity set (even with weaker macro backdrop, the overall supply/demand imbalance on employment
towards larger scaled enterprise
remains a potential multi-year tailwind to the platform); & 3) willingness to moderate growth investments (mostly S&M) to meet the new end-market volatility (resulting in Adj EBITDA Q3 beat & Q4 guide ahead of expectations). In addition, we were encouraged by
Zip clients, grow topline revenue and hit
Recruiter
ZIP Buy $ 26 ŵŐŵƚ͛ƐĂŶƐǁĞƌƐŽŶŵĞĞƚŝŶŐƚŚĞŶĞǁŶŽƌŵĂů;ƉŽƐƐŝďůǇŵĂŶǇŵŽƌĞŝŶĚŝǀŝĚƵĂůƐůŽŽŬŝŶŐĨŽƌǁŽƌŬŝŶƚŚĞŶĞǆƚϲͲϭϮŵŽŶƚŚƐͿǁŝƚŚĂĚƌŝǀĞƚŽĞŶŚĂŶĐĞƚŚĞƉůĂƚĨŽƌŵ͛ƐƐĐĂůĞͬƐĐŽƉĞŝŶƚŽƐƵĐŚĂŶĞŶǀŝƌŽŶŵĞŶƚ͘KǀĞƌƚŚĞƐŚŽƌƚƚĞƌŵ͕ǁĞƐĞĞƚŚĞŬĞǇĚƌŝǀĞƌƐŽĨƐƚŽĐŬƉĞƌĨŽƌŵĂŶĐĞ
their LT opex targets while delivering
being more about the pace/cadence of the end market macro driven volatility and how that translates into a balance of revenue and margin in the coming quarters. Longer term, we see ZIP as well-positioned against several themes: 1) strong broader macro trends
on margins in the midst of a
acting as a tailwind to the job market and ZipRecruiter (continued shift towards online recruiting, tight labor market); 2) advanced matching algorithms competitively position ZipRecruiter in a fragmented marketplace; and 3) strong unit economics with rising spend per
macroeconomic uncertainty?
employer cohort over time & rising margin profile (on already profitable levels).
Source: Company data, FactSet, Goldman Sachs Global Investment Research
18 November 2022 <0

Valuation & Risks

Exhibit 10: Valuation & Risks
Ticker Rating Price 12-Mo. PT Valuation Methodology Key Risks
Equal blend of: (1) EV/'23 GAAP EBITDA & (2) a modified DCF using EV/'26 (FCF-SBC) (-) Competition, headwinds to monetizable search from disruption, shifting media habits, heavy investments depress margins for longer than expected,
GOOGL Buy $ 99 $ 135
discounted back 3 years no/low levels of incremental S/H returns, regulatory scrutiny & industry practices alter business model
Equal blend of: (1) EV/'23 GAAP EBITDA & (2) a modified DCF using EV/'26 (FCF-SBC) (-) Competition, execution risk around monetization of emerging opptys; shifting media habits, heavy investments depress margins for longer than
META Buy $ 113 $ 165
discounted back 3 years expected, no/low levels of incremental S/H returns, regulatory scrutiny & industry practices alter business model
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-) Competition for user growth/engagement, advertiser demand that deviates from current expectations, margin pressure (platform/content
SNAP Neutral $ 11 $ 10
discounted back 3 years initiatives) worse or better vs. GSe, regulatory scrutiny & industry practices around data privacy
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (-) Current macroeconomic headwinds, MAU growth fails to stabilize from our expectations, int’l revenue trajectory, execution risk against
PINS Buy $ 25 $ 31
discounted back 3 years shopping/ecommerce oppty, & regulatory scrutiny & industry practices around data privacy
Sum of the parts from: (1) Angi, (2) Dotdash, (3) Search, (4) Emerging & Other, and (5) (-) Emergence of competitors in each of the businesses; Ability to realize synergies and integrate Meredith within Dotdash; Slower than expected ramp in
IAC Buy $ 49 $ 87
Other invesments scaling the Angi Services fixed price offering within ANGI; & Broader macro economic environment slowing
Equal blend of: (1) EV/'23 GAAP EBITDA & (2) a modified DCF using EV/'26 (FCF-SBC) (+/-) Advertiser growth deviates from current assumptions, faster or slower user growth/engagement, increased regulatory and 3P platform scrutiny,
YELP Neutral $ 30 $ 35
discounted back 3 years ability to shift towards brand and DR advertising dollars, and competition
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-) User growth deviates from current modeling assumptions, different international revenue trajectory, impact of COVID-19, execution against the
KIND Neutral $ 2 $ 2.75
discounted back 3 years monetization opportunity, competition, & increased regulatory scrutiny
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (-) Slowdown in overall advertising spend caused by macro volatility, competition for advertising dollars, execution risk against LT opptys, & regulatory
DV Buy $ 26 $ 32
discounted back 3 years scrutiny
Equal blend of: (1) EV/'23 GAAP EBITDA & a modified DCF using EV/'26 (FCF-SBC)
discounted back 3 years; (2) SOTP of EV/'23 Sales applied to our 1P, 3P, Retail (-) Competition (eComm & cloud), execution risk in scaling high margin businesses (advertising, cloud, 3P selling, subscriptions, etc.), heavy investments
AMZN Buy $ 97 $ 165
Subscription, AWS & Other segment ests; & (3) SOTP of EV/'23 EBIT applied to our North depress margins for longer than expected, regulatory scrutiny & industry practices alter business model
America & AWS segments and EV/'23 Sales applied to our International segment ests
Equal blend of: (1) EV/'23 GAAP EBITDA & (2) a modified DCF using EV/'26 (FCF-SBC) (+) Faster than expected recovery of the global consumer environment; eBay making significant progress on key initiatives that are expected to drive
EBAY Sell $ 45 $ 41
discounted back 3 years forward GMV growth (esp. in focus categories)
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-) Customer growth (surprising either to upside or downside vs. our estimates), rate of auto-ship/subscription adoption & potential impact on basket
CHWY Neutral $ 42 $ 38
discounted back 3 years size, level of execution on private label, pet health & int’l expansion
Equal blend of: (1) EV/'23 Gross Profit & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-) Competition for customer growth (better or worse than expected); regulatory changes; ability to scale revenue through key growth initiatives
GDRX Neutral $ 5 $ 8
discounted back 3 years
Equal blend of: (1) EV/'24 GAAP EBITDA & (2) a modified DCF using EV/'27 (FCF-SBC) (-) Slowdown in consumer spending or eCommerce, high competition, lower than expected engagement, higher than expected churn, & any macro
ETSY Buy $ 120 $ 130
discounted back 3 years pressures
Equal blend of: (1) EV/'24 Sales & (2) a modified DCF using EV/'27 GAAP EBITDA (+/-) Greater or lower visibility on timing of positive revenue growth and Adj EBITDA profitability, more or less favorable competitive dynamics, continued
W Neutral $ 38 $ 40
discounted back 3 years supply chain disruption & macro volatility
Equal blend of: (1) EV/'23 GAAP EBITDA & (2) a modified DCF using EV/'26 (FCF-SBC) (+) Subscriber growth trends surprise to upside, price increases have limited impact to churn and/or gross sub additions, competition (for subscribers
NFLX Sell $ 306 $ 200
discounted back 3 years and/or original content) less than currently feared
Equal blend of: (1) EV/'23 Gross Profit & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-) Competition, margin impact from evolution of podcasting product, emerging market growth, shifting media habits, impact of price increases on user
SPOT Neutral $ 83 $ 114
discounted back 3 years base/financial model, volatility from global macro env’t & investor risk appetite for growth stocks
(+/-) User growth/platform scale as a result of product innovation & new categories, ROI on manufacturing & logistics investments, competition, path to
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA
PTON Neutral $ 11 $ 12 profitability (output of product mix, sales growth, marketing ROIs, scale, etc.), macro impact on consumer spending
(-) Slower than expected Mobility industry recovery post-COVID-19, regulation (driver classification, merchant commission caps, etc.), competition (both
UBER Buy $ 30 $ 45 within Mobility & Delivery), tough year-over-year comps in Delivery vs. COVID-19 benefit, path to profitability pushed out vs. expectations
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-) Uncertainty around rate of growth in post pandemic environment, debates on required marketing spend levels needed, potential changes to
DASH Neutral $ 61 $ 69
discounted back 3 years regulation, competitive aspects, expansion into international, and volatility in macro environment
(-) Active rider growth (losing share or slower than expected industry recovery post-COVID-19), changes in consumer behavior, ROI on micromobility
LYFT Buy $ 12 $ 20 investments, elevated driver incentives needed, potential negative impact of market pricing on end demand, regulation (driver classification)
Equal blend of: (1) EV/'23 GAAP EBITDA & (2) a modified DCF using EV/'26 (FCF-SBC) (+/-) Recovery of travel demand, market share gains in NA and/or losses in Europe, competition, execution risk against “connected trip” oppty (share gains
BKNG Neutral $ 2,014 $ 2,270
discounted back 3 years vs. ROI on investments), resumption of S/H returns (surprising to upside or downside)
(+) Faster recovery in travel demand & accelerating adoption of alt. accomm., int’l market share gains, competition abates, expanding categories offered
ABNB Sell $ 104 $ 98 on platform (traditional hotel, experiences, etc.) seeing strong user adoption, scale benefits driving margin improvement in excess of our ests
Equal blend of: (1) EV/'23 GAAP EBITDA & (2) a modified DCF using EV/'26 (FCF-SBC) (-) Travel demand recovery & return to ’19 levels slower than our ests (due to con’t COVID-19 headwinds), market share loss in NA, competition, no/low
EXPE Buy $ 97 $ 173
discounted back 3 years levels of incremental S/H returns
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-) Faster or slower recovery in travel demand, competitive intensity, consumer behavior & preference for specific types of travel, marketing spend, &
VCSA Neutral $ 2 $ 4
discounted back 3 years international expansion
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-)Better or worse than expected learner growth, declining or improving user engagement and retention, potential increased content fees, slower or
COUR Neutral $ 14 $ 14
discounted back 3 years faster than expected progress on the path to profitability, heightened competition
Blended fundamental (85% weight)/M&A (15% weight): (1) EV/'23 GAAP EBITDA & (2) (+/-) Higher or lower than expected traffic, engagement, and monetization trends, levels of competition in the industry, and the ongoing lawsuit with
CHGG Neutral $ 29 $ 24
EV/'26 FCF-SBC Pearson
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-) Faster or slower than expected user acquisition, better or worse than expected payer conversion, impact of COVID-19, execution of adjacent
DUOL Neutral $ 71 $ 92
discounted back 3 years monetization opportunities, & competition
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-) Faster or slower than expected user acquisition and engagement, adoption of K-12 institutional strategy, industry competition & macro volatility
NRDY Neutral $ 2 $ 3
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (-) Competitive landscape, adoption of online auctions, slower pace of gaining scale, & broader macro factors
ACVA Buy $ 9 $ 12
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-) Potential to gain or lose market share to competitors, broader adoption of freelancing occurring faster or slower than expected, faster adoption of
FVRR Neutral $ 39 $ 33
discounted back 3 years value added services, & potential pushback from sellers or buyers on commission rates
abf1713081cf4bd28921692cb124a462
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (-) Potential to lose market share to competitors, broader adoption of freelancing occurring slower than expected, & slower adoption of managed services
UPWK Buy $ 14 $ 24
Equal blend of: (1) EV/'23 Gross Profit & (2) a modified DCF using EV/'26 GAAP EBITDA (-) Slowing user engagement and worse retention than expected, worsening active seller engagement, supply chains normalization headwinds
XMTR Buy $ 45 $ 57
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (-) Decline in job openings and/or employer demand, competitive intensity increasing across US job marketplaces, marketing spend, & inability to sustain
ZIP Buy $ 17 $ 26
discounted back 3 years improvements in hiring
Blended fundamental (85% weight)/M&A (15% weight): (1) EV/'23 GAAP EBITDA & (2) (+) Faster than expected user growth, greater traction and acceptance of Groupon's platform, faster than expected cost reduction efforts, competitive
GRPN Sell $ 9 $ 6.50
EV/'26 FCF-SBC environment, & the potential to be acquired
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (+/-) Lower than expected pet ownership, higher than expected customer acquisition costs, lower than expected repeat bookings, industry competition, &
ROVR Neutral $ 5 $ 4.50
discounted back 3 years volatility from the macro environment
Equal blend of: (1) EV/'23 Gross Profit & (2) a modified DCF using EV/'26 GAAP EBITDA (-) Execution around scaling fixed price business mode, competition in the home services space, & ; slower than expected transition from offline to online
ANGI Buy $ 2 $ 6
(+) The inflationary environment & negative impact on FTDR's margins abates &/or price increases implemented by the company able to offset cost
Equal blend of: (1) EV/'23 GAAP EBITDA & (2) a modified DCF using EV/'26 (FCF-SBC)
FTDR Sell $ 24 $ 21 inflation without impacting churn or incremental demand; Better than expected adoption & growth in FTDR's Pro Connect business without materially
impacting margins from investments to scale.
(-) Ongoing impact of COVID-19, evolving macro and geopolitical landscape, increased regulatory scrutiny, lower-than-anticipated payer net additions,
MTCH Buy $ 49 $ 70 heightened user acquisition costs, heightened competition, decreased user retention, security breaches, & app store fees
(-) Ongoing impact of COVID-19, evolving macro and geopolitical landscape, increased regulatory scrutiny, lower-than-anticipated payer net additions,
BMBL Buy $ 24 $ 30 heightened user acquisition costs, heightened competition, decreased user retention, security breaches, & app store fees
Blended fundamental (85% weight)/M&A (15% weight): (1) EV/'24 IFRS EPS & (2) EV/'24 (+/-) Faster or slower execution on forward pipeline, international scale and lower levels of competition, & higher or lower than expected productivity
UBI-FR Neutral $ 27 $ 37
Adj EBITDA levels
Blended fundamental (85% weight)/M&A (15% weight): (1) EV/'24 FCF-SBC & (2) EV/'24 (+/-) Higher or lower unit and live services estimates, integration struggles, government regulation, receptivity of new games, potential loss of licensing, &
EA Neutral $ 129 $ 126
Adj EBITDA increased competition
(-) Lower unit and live services sales, slower integration with recent acquisition Zynga, potential loss of licensing agreements, increased competition, &
TTWO Buy $ 101 $ 150 Based on EV/'24 FCF-SBC
macro headwinds
Blended fundamental (85% weight)/M&A (15% weight): (1) EV/'23 FCF-SBC & (2) EV/'23 (+/-) Better or worse than expected new game launches, higher or lower user acquisition costs, high competition, & ownership structure
PLTK Neutral $ 10 $ 15
Sales
Equal blend of: (1) EV/'23 Bookings & (2) a modified DCF using EV/'26 (FCF-SBC) (+) Higher than expected engagement & monetization on the platform; better developer acquisition (through higher payouts) vs. competitors; better than
RBLX Sell $ 34 $ 24
discounted back 3 years expected efficiencies on R&D and trust & safety investments
Blended fundamental (85% weight)/M&A (15% weight): (1) EV/'23 FCF-SBC & (2) EV/'23 (-) Worse than expected new game launches, higher user acquisition costs, high competition, & ownership structure
SCPL Buy $ 15 $ 20
Sales
Equal blend of: (1) EV/'23 Sales & (2) a modified DCF using EV/'26 GAAP EBITDA (-) Data privacy and regulation, reliance on 3P app distribution channels, high competition, & fingerprinting
APP Buy $ 15 $ 33
(+/-) COVID-19 disruption, macroeconomic uncertainty, any mismatch of supply and demand on the platform, may face rising user acquisition costs, take
TDUP Neutral $ 1 $ 2 Based on EV/'23 Sales
rate levels, & heightened competition
As of 11/16/2022
18 November 2022 11
Disclosure Appendix
Reg AC
We, Eric Sheridan, Alexandra Steiger, Ben Miller, Lane Czura, Alex Vegliante, CFA, Pierre Riopel, Sarah Boulos and Sanchit Chandna, hereby certify that
all of the views expressed in this report accurately reflect our personal views about the subject company or companies and its or their securities. We
also certify that no part of our compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this
report.
Unless otherwise stated, the individuals listed on the cover page of this report are analysts in Goldman Sachs’ Global Investment Research division.
GS Factor Profile
The Goldman Sachs Factor Profile provides investment context for a stock by comparing key attributes to the market (i.e. our coverage universe) and its
sector peers. The four key attributes depicted are: Growth, Financial Returns, Multiple (e.g. valuation) and Integrated (a composite of Growth, Financial
Returns and Multiple). Growth, Financial Returns and Multiple are calculated by using normalized ranks for specific metrics for each stock. The
normalized ranks for the metrics are then averaged and converted into percentiles for the relevant attribute. The precise calculation of each metric may
vary depending on the fiscal year, industry and region, but the standard approach is as follows:
Growth is based on a stock’s forward-looking sales growth, EBITDA growth and EPS growth (for financial stocks, only EPS and sales growth), with a
higher percentile indicating a higher growth company. Financial Returns is based on a stock’s forward-looking ROE, ROCE and CROCI (for financial
stocks, only ROE), with a higher percentile indicating a company with higher financial returns. Multiple is based on a stock’s forward-looking P/E, P/B,
price/dividend (P/D), EV/EBITDA, EV/FCF and EV/Debt Adjusted Cash Flow (DACF) (for financial stocks, only P/E, P/B and P/D), with a higher percentile
indicating a stock trading at a higher multiple. The Integrated percentile is calculated as the average of the Growth percentile, Financial Returns
percentile and (100% - Multiple percentile).

Financial Returns and Multiple use the Goldman Sachs analyst forecasts at the fiscal year-end at least three quarters in the future. Growth uses inputs
for the fiscal year at least seven quarters in the future compared with the year at least three quarters in the future (on a per-share basis for all metrics).
For a more detailed description of how we calculate the GS Factor Profile, please contact your GS representative.
M&A Rank
Across our global coverage, we examine stocks using an M&A framework, considering both qualitative factors and quantitative factors (which may vary
across sectors and regions) to incorporate the potential that certain companies could be acquired. We then assign a M&A rank as a means of scoring
companies under our rated coverage from 1 to 3, with 1 representing high (30%-50%) probability of the company becoming an acquisition target, 2
representing medium (15%-30%) probability and 3 representing low (0%-15%) probability. For companies ranked 1 or 2, in line with our standard
departmental guidelines we incorporate an M&A component into our target price. M&A rank of 3 is considered immaterial and therefore does not
factor into our price target, and may or may not be discussed in research.
Quantum
Quantum is Goldman Sachs’ proprietary database providing access to detailed financial statement histories, forecasts and ratios. It can be used for
in-depth analysis of a single company, or to make comparisons between companies in different sectors and markets.
Disclosures
Rating and pricing information
ACV Auctions Inc. (Buy, $8.61), ANGI Homeservices Inc. (Buy, $2.17), Airbnb Inc. (Sell, $104.43), Alphabet Inc. (Buy, $98.85), Amazon.com Inc. (Buy,
$97.12), AppLovin Corp. (Buy, $14.57), Bird Global Inc. (Rating Suspended, $0.29), Booking Holdings Inc. (Neutral, $2,013.78), Bumble Inc. (Buy, $24.18),
abf1713081cf4bd28921692cb124a462
Chegg Inc. (Neutral, $28.52), Chewy Inc. (Neutral, $42.24), Coursera Inc. (Neutral, $14.16), DoorDash Inc. (Neutral, $60.78), DoubleVerify Inc. (Buy,
$26.26), Duolingo Inc. (Neutral, $70.66), Electronic Arts Inc. (Neutral, $129.34), Etsy Inc. (Buy, $119.72), Expedia Group (Buy, $97.45), Fiverr
International Ltd. (Neutral, $38.56), Frontdoor Inc. (Sell, $24.21), GoodRx Holdings Inc. (Neutral, $5.00), Groupon Inc. (Sell, $8.55), IAC/InterActiveCorp
(Buy, $49.45), Lyft Inc. (Buy, $11.97), Match Group (Buy, $49.34), Meta Platforms Inc. (Buy, $113.23), Nerdy Inc. (Neutral, $2.45), Netflix Inc. (Sell,
$306.02), Nextdoor Holdings (Neutral, $2.42), Peloton Interactive Inc. (Neutral, $10.94), Pinterest Inc. (Buy, $25.36), Playtika (Neutral, $9.93), Roblox
(Sell, $34.41), Rover Group (Neutral, $4.91), Sciplay Corp. (Buy, $15.30), Snap Inc. (Neutral, $11.07), Spotify Technology S.A. (Neutral, $82.50), Take-Two
Interactive Software Inc. (Buy, $100.81), ThredUP Inc. (Neutral, $1.21), Uber Technologies Inc. (Buy, $30.04), Ubisoft Entertainment SA (Neutral, €26.61),
Upwork Inc. (Buy, $14.03), Vacasa Inc. (Neutral, $1.75), Wayfair Inc. (Neutral, $37.58), Xometry Inc. (Buy, $44.64), Yelp Inc. (Neutral, $29.76), ZipRecruiter
Inc. (Buy, $16.52) and eBay Inc. (Sell, $45.49).
The rating(s) for ACV Auctions Inc., Airbnb Inc., Alphabet Inc., Amazon.com Inc., AppLovin Corp., Bird Global Inc., Booking Holdings Inc.,
Bumble Inc., Chegg Inc., Coursera Inc., DoorDash Inc., DoubleVerify Inc., Duolingo Inc., Electronic Arts Inc., Etsy Inc., Expedia Group, Fiverr
International Ltd., GoodRx Holdings Inc., Groupon Inc., IAC/InterActiveCorp, Lyft Inc., Match Group, Meta Platforms Inc., Nerdy Inc., Netflix
Inc., Nextdoor Holdings, Peloton Interactive Inc., Pinterest Inc., Playtika, Roblox, Rover Group, Sciplay Corp., Snap Inc., Spotify Technology
S.A., Take-Two Interactive Software Inc., ThredUP Inc., Uber Technologies Inc., Ubisoft Entertainment SA, Upwork Inc., Vacasa Inc., Wayfair Inc.,
Xometry Inc., Yelp Inc., ZipRecruiter Inc. and eBay Inc. is/are relative to the other companies in its/their coverage universe: ACV Auctions Inc.,
ANGI Homeservices Inc., Activision Blizzard Inc., Airbnb Inc., Alphabet Inc., Amazon.com Inc., AppLovin Corp., Bird Global Inc., Booking Holdings Inc.,
Bumble Inc., Chegg Inc., Chewy Inc., Coursera Inc., DoorDash Inc., DoubleVerify Inc., Duolingo Inc., Electronic Arts Inc., Etsy Inc., Expedia Group,
Fiverr International Ltd., Frontdoor Inc., GoodRx Holdings Inc., Groupon Inc., IAC/InterActiveCorp, Lyft Inc., Match Group, Meta Platforms Inc., Nerdy
Inc., Netflix Inc., Nextdoor Holdings, Peloton Interactive Inc., Pinterest Inc., Playtika, Poshmark Inc., Rent the Runway Inc., Roblox, Rover Group, Sciplay
Corp., Snap Inc., Spotify Technology S.A., Take-Two Interactive Software Inc., ThredUP Inc., Uber Technologies Inc., Ubisoft Entertainment SA, Upwork
Inc., Vacasa Inc., Wayfair Inc., Xometry Inc., Yelp Inc., ZipRecruiter Inc., eBay Inc.
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Distribution of ratings/investment banking relationships

Goldman Sachs Investment Research global Equity coverage universe
18 November 2022 12
Rating Distribution Investment Banking Relationships

Buy Hold Sell Buy Hold Sell
Global 48% 36% 16% 64% 59% 50%
As of October 1, 2022, Goldman Sachs Global Investment Research had investment ratings on 3,100 equity securities. Goldman Sachs assigns stocks
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18 November 2022 13
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18 November 2022 | 12:03AM EST

Americas Technology: Internet

Q3’22 EPS Review: Where To From Here?– Recapping

Sub-Sector Takeaways: Mixture of Slowdowns Emerge While Some Consumer

With regards to eCommerce, we would highlight 1) the more resilient operating

performance of scaled players, as consumers consolidated more of their spend towards

and/or weakening consumer demand; & 3) continued industry efforts to optimize

expansion and diversiﬁed audio product initiatives). With regards to gaming

Risk/Reward Matrix & RSI

Exhibit 1: Risk/Reward Matrix - Large Cap

Source: FactSet, Company data, Goldman Sachs Global Investment Research

Exhibit 2: Risk/Reward Matrix - SMID Cap

Source: FactSet, Company data, Goldman Sachs Global Investment Research

Lookback as of 11/16/2022 Lookback as of 11/16/2022

Source: FactSet Source: FactSet

Key Debates & Our View

Source: Company data, Goldman Sachs Global Investment Research, Factset

How will a mix of Mobility recovery/Delivery

Source: Company data, Goldman Sachs Global Investment Research, FactSet

How will MTCH navigate continued macro

Source: Company Data, FactSet, Goldman Sachs Global Investment Research

How will management balance topline growth

Streaming Media & Subscription Services

Source: Company data, FactSet, Goldman Sachs Global Investment Research

Source: Company data, FactSet, Goldman Sachs Global Investment Research

18 November 2022 <0

Valuation & Risks

Source: FactSet, Company data, Goldman Sachs Global Investment Research

percentile and (100% - Multiple percentile).

Company-speciﬁc regulatory disclosures

Distribution of ratings/investment banking relationships

Rating Distribution Investment Banking Relationships

Price target and rating history chart(s)

available from Goldman Sachs International on request.

Ratings, coverage universe and related deﬁnitions

Global product; distributing entities

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