New Zealand exchange halts trading for 4th straight day after multiple cyberattacks


New Zealand’s NZX exchange has been targeted by DDoS attacks four days this week.


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New Zealand’s stock exchange halted trading for a fourth day in a row Friday due to multiple cyberattacks.

“We are currently experiencing connectivity issues which appear similar to those caused by severe DDoS attacks from offshore this week,” Wellington-based exchange operator NZX Ltd.
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said in a statement. NZX’s website was down as well. DDoS, or distributed denial-of-service, attacks overwhelm a targeted server or network with traffic.

ZDNet.com reported a global criminal syndicate is behind the attacks, which are part of a global campaign to extort bitcoin from some of the world’s largest financial and e-commerce companies. PayPal
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and its Venmo service have also been targeted, ZDNet said, along with MoneyGram
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,
YesBank India, Worldpay and Braintree.

The hackers are reportedly the same as those identified by Akamai Technologies Inc.
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in an alert earlier this week, who are sending ransom letters demanding bitcoin to companies in the U.S., U.K. and Asia-Pacific region. The hackers reportedly claim to be from the  Armada Collective and Fancy Bear groups, but it is believed they are not actually affiliated with those notorious hacker organizations.

NZX is working with its internet service provider, as well as cybersecurity partners and New Zealand’s national security bureau, the New Zealand Herald reported.

The repeated interruptions in service have raised serious concerns about the exchange’s security, and raised fears that the cyberattacks could be the prelude to moves against larger global exchanges.

Professor Dave Parry of Auckland University of Technology’s department of computer science told New Zealand news service Newshub that it was “a very serious attack on critical infrastructure in New Zealand,” and “indicates a level of sophistication and determination which is relatively rare.”

Before trading was stopped, New Zealand’s NZX-50 index
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+0.33%

was closing in on its all-time record high of 12,073.34, set in February.

Separately, a DDoS-bitcoin extortion scheme at Tesla Inc.’s
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Nevada gigafactory was apparently thwarted by the FBI earlier this month, and a Russian national arrested in the scheme.



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Bill.com beats on earnings, CEO predicts work-from-home trends are ‘here to stay’


Bill.com Holdings Inc. Chief Executive René Lacerte is optimistic that the COVID-19 crisis will drive a longer-term shift toward remote work that increases demand for digital accounting tools.

The company already saw signs of those trends in its recently ended fiscal fourth quarter, as it added 6,700 net new customers, gains it attributed in part to a greater need to manage billing operations remotely during the pandemic. Bill.com
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targets small- and medium-sized businesses through software products meant to replace the many manual processes involved in traditional corporate accounting.

Watch: How 5G promises to enable a fully remote workforce

Lacerte expects that working from home “is here to stay” and that the dynamics pushing small-business customers to try Bill.com’s offerings because their back-office teams can’t make it into the workplace during the pandemic will persist even after the crisis is over.

“We are seeing that COVID has been an accelerant to how people think about their work,” he told MarketWatch.

Lacerte said that challenges with the U.S. Postal Service might also be something that businesses are thinking about, noting that he grew up in an entrepreneurial family and knows that those running businesses “worry about paying suppliers on time.” Cost cuts at the Postal Service have led to mail delays.

Though Bill.com topped revenue and earnings expectations for its latest quarter, shares were off about 4% in after-hours trading.

The company reported fiscal fourth-quarter revenue of $42.1 million, up from $31.7 million a year earlier and ahead of the FactSet consensus, which called for $38 million.

Bill.com posted a net loss of $9.5 million, or 13 cents a share, compared with a loss of $4.5 million, or 56 cents a share, in the year-earlier quarter. On an adjusted basis, Bill.com lost 2 cents a share, compared with a loss of 2 cents a share a year prior. Analysts surveyed by FactSet were modeling an adjusted loss of 11 cents a share.

Jefferies analyst Samad Samana was most struck by the company’s disclosure of $152 million in remaining performance obligations with financial institutions to be recognized as revenue. This was up from $44 million in the March quarter, and while most of the increase in performance obligations are expected to be recognized more than a year out, Samana said in a note to clients that the traction here is “representative of the new and recent expansions with major [financial institutions].”

Bill.com highlighted in its earnings release an expanded agreement with one of the top three small-business banks in the U.S. “For them to say this is going to be the default solution for payments, for them to make this commitment to us is significant,” Lacerte told MarketWatch.

He said that the increase in performance obligations “is a testament to the platform we have build and the confidence partners have in the ability to digitally transform their lives.”

Samana also highlighted the company’s annual customer retention rate of 82%, in line with the company’s March rate. “This impressive result quelled fears of higher churn and demonstrates the stickiness of Bill.com’s solutions with end customers,” he wrote, while maintaining a hold rating but boosting his price target to $110 from $98.

Shares have gained 65% over the past three months as the S&P 500
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has risen 15%.



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U.S. TikTok CEO Kevin Mayer resigns, saying ‘the political environment has sharply changed’


Just three months after taking the job, TikTok Chief Executive Officer Kevin Mayer announced his resignation in an internal memo to employees late Thursday, where he spoke of a changing political landscape.


“In recent weeks, as the political environment has sharply changed, I have done significant reflection on what the corporate structural changes will require, and what it means for the global role I signed up for. Against this backdrop, and as we expect to reach a resolution very soon, it is with a heavy heart that I wanted to let you all know that I have decided to leave the company.”


— Kevin Mayer, outgoing CEO of TikTok

Mayer’s announcement comes amid intense pressure for the wildly popular app, which President Donald Trump has vowed he will ban in the U.S. unless parent company Beijing-based ByteDance Inc. sells it within 90 days.

Mayer said his decision had “nothing to do with the company, what I see for our future, or the belief I have in what we are building.” He added that the chairman of ByteDance, Zhang Yiming, understood and support his decision.

The outgoing CEO said he remains upbeat on the company’s future, which he described as ”incredibly bright.” A spokesperson from the company said that Vanessa Pappas, general manager for TikTok U.S., will be the interim head.

Mayer said any potential structural changes should not affect the experience of users — 100 million in the U.S. — and the platform “will continue to provide our global community an amazing and integrated experience as it does today.”

He joined TikTok in May, after a stint in charge of Walt Disney Co’s
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+1.84%

streaming service.

TikTok announced Monday that it would file a complaint in federal court over Trump’s attempt to ban the service in the U.S., arguing that it has “taken extraordinary measures to protect the privacy and security of TikTok’s U.S. user data.” The company claims U.S. data is stored outside of China, while “software barriers” help ensure it’s stored separately from that of other ByteDance products.

Software giant Microsoft Corp.
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+2.16%

has indicated it may be interested in buying TikTok’s U.S. operations, while Oracle
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+2.49%

and Twitter
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have also reportedly expressed interest.



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Facebook and Twitter are concerned about what is going to happen after Election Day


Securing democracy on social media may be hardest after Americans vote in the presidential election.

In what is shaping up as a newfangled nightmare in their efforts to stop election interference, Facebook Inc.
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+3.47%

, Twitter Inc.
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and others are as concerned about misinformation and other issues in days after the U.S. election as they are in the months preceding it, including Election Day.

“How do we ensure that voters have accurate information?” as election results are counted in the days following the Nov. 3 presidential election, Nathaniel Gleicher, Facebook’s head of security policy, asked during a Tuesday webinar on protecting the upcoming elections. He did not elaborate, but hinted there could be attempts by politically motivated groups to question the legitimacy of votes, including mail-in ballots.

President Donald Trump has endlessly claimed without evidence that voting by mail — expected to increase dramatically because of the pandemic — is susceptible to large-scale fraud. (Nearly one in four voters cast 2016 presidential ballots that way.)

Yoel Roth, head of site integrity at Twitter, echoed those concerns, but he added that social-media companies are better positioned this time around than four years ago. He said the micro-blogging service is promoting “credible, authoritative information” during political-party conventions, presidential and vice-presidential debates, and election results in November.

Gleicher added that Facebook is detecting more “bad actors” than in elections in 2018 and 2016, through a greater understanding of the risk, and through coordination with academia, media, and state and local officials.

Their fears come amid concerted efforts by Facebook, Twitter and others to tamp down on misinformation concerning the U.S. elections.

Facebook, which has repeatedly acknowledged its part in being exploited by foreign and domestic adversaries during the 2016 presidential election with fake news and misinformation, this month launched a Voting Information Center to help users with accurate, easy-to-find information about voting wherever they live.

Read more: Facebook hardens digital defense for misinformation ahead of elections

The addendum will link to a new voter information hub similar to one about COVID-19 that Facebook says has been seen by billions of people globally. The labels will read, “Visit the Voting Information Center for election resources and official updates.” Facebook expects the voter hub to reach at least 160 million people in the U.S. In July, the company began adding similar links to misleading posts by politicians, including Trump, about voting.

Twitter, meanwhile, has said it will roll out measures on new tools, policies and voting resources, as well as expand its “civic integrity policies” to address misrepresentations about mail-in voting. In January, the company created a feature that lets users report voter suppression and misinformation.

Among other companies, Snap Inc.
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+1.19%

has unveiled a “Voter Registration Mini” tool so users can register to vote directly in Snapchat. It also posted a “Voter Guide” with information about topics such as voting by mail and voter registration.



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Palantir takes swings at Silicon Valley on its way to Wall Street


Palantir Technologies Inc., a software company founded in Silicon Valley to help governments and companies collect and parse data, used its Tuesday filing for a direct listing to confirm a move away from the California technology hub and declare that “we seem to share fewer and fewer of the technology sector’s values and commitments.”

The controversial and secretive software company, co-founded by Facebook Inc.
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board member and Donald Trump supporter Peter Thiel, made its filing with the U.S. Securities and Exchange Commission public Tuesday. The document begins with a letter from Chief Executive Alexander Karp that defends Palantir’s work with governments and militaries around the world and declares its differences with Silicon Valley, while confirming a headquarters move to Denver.

“Our company was founded in Silicon Valley,” Karp wrote. “But we seem to share fewer and fewer of the technology sector’s values and commitments.”

CEO letters are rather common in filings for initial public offerings and direct listings, but Palantir took the approach one step further by making Karp’s letter the first section of its filing. The letter seemed to relish in calling out advertising-based business models such as Facebook and Alphabet Inc.’s
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+1.30%

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+1.26%

Google.

“From the start, we have repeatedly turned down opportunities to sell, collect, or mine data. Other technology companies, including some of the largest in the world, have built their entire businesses on doing just that,” Karp wrote. “Software projects with our nation’s defense and intelligence agencies, whose missions are to keep us safe, have become controversial, while companies built on advertising dollars are commonplace. For many consumer internet companies, our thoughts and inclinations, behaviors and browsing habits, are the product for sale. The slogans and marketing of many of the Valley’s largest technology firms attempt to obscure this simple fact.”

Palantir has faced acrimony and anger far beyond Silicon Valley for its secretive work with powerful entities.The company has contracts with the Department of Homeland Security and U.S. Immigration and Customs Enforcement, including for software used to track migrants at the border. Because of that, it has been targeted by protesters and activists including Mijente, an immigration advocacy group.

“This is not just a question of one pocket of the country, the protests are happening nationwide,” said Jacinta Gonzalez, senior campaign director at Mijente.

“Palantir is complicit in the surveillance, arrest and deportation of our communities through their work with ICE,” Gonzalez said. “Their S-1 recognizes that these are risky contracts to take on. We’re calling on investors everywhere not to invest when the IPO happens.”

See also: The CEO who made one of Silicon Valley’s worst acquisitions wants a $400 million blank check

Karp said that Palantir employees “embrace the complexity” of deals that involve helping government surveil people, and other ethically questionable actions.

“The construction of software platforms that enable more effective surveillance by the state of its adversaries or that assist soldiers in executing attacks raises countless issues, involving the points of tension and tradeoffs between our collective security and individual privacy, the power of machines, and the types of lives we both want to and should lead,” Karp wrote. “The ethical challenges that arise are constant and unrelenting. We embrace the complexity that comes from working in areas where the stakes are often very high and the choices may be imperfect.”

Irina Raicu, the director of internet ethics at Santa Clara University’s Markkula Center for Applied Ethics, told MarketWatch on Tuesday that Karp’s letter “includes some very old (and repeatedly debunked) Silicon Valley tropes,” and pushed back against three specific points the CEO made.

“For example, that ‘[t]he bargain between the public and the technology sector has for the most part been consensual, in that the value of the products and services available seemed to outweigh the invasions of privacy that enabled their rise,’” Raicu wrote in an email, quoting Karp’s letter. “It has become very clear, over the past several years, that the public had no understanding of the privacy-invasive practices behind many of the services it was offered; had assumed that laws were in place to prevent such practices; and has been pushing for new laws to prevent them.”

In response to Karp’s claim that Americans will not “remain tolerant of the idiosyncrasies and excesses of the Valley,” Raicu said that Americans have not been tolerant of the Valley’s actions for years, adding “Surely Palantir has crunched enough data to be aware of that.”

As to Karp’s statement that Palantir has “chosen sides” between Silicon Valley and the government, Raicu said Palantir’s “clients in law enforcement and intelligence agencies do not represent a different ‘side’ from the American public.”

Read: Facebook and Twitter are worried about the day after Election Day

While attacking Silicon Valley, Palantir still is retaining some of the DNA of the tech hub, especially in regards to retaining power with its founders after going public, just as Mark Zuckerberg maintains control of Facebook and Sergey Brin and Larry Page still rule over Google. The company created a three-tiered stock structure that gives one vote to publicly available shares, 10 votes to class B insider shares, and “variable” votes to “class F” shares owned by its three co-founders: Thiel, Karp and Stephen Cohen. The collective class F shares will hold up to 49.99% of votes, while other shares owned by the trio will allow them to effectively control the company.

A direct listing allows a company’s shares to be sold on the open market, but does not involve the sale of fresh shares like an IPO, and has been used by well-funded mature startups including Spotify Technology SA
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-0.16%

and Slack Technologies Inc.
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. Palantir’s class A shares will eventually trade on the New York Stock Exchange under the ticker symbol PLTR. Palantir listed a dozen banks that are acting as financial advisers on the deal, with Morgan Stanley as the main consultant with the designated market maker, which will determine the opening price of the shares.

Palantir launched its first software platform, Gotham, in 2008, after receiving funding from the Central Intelligence Agency’s In-Q-Tel funding arm.

“Defense agencies in the United States then began using Gotham to investigate potential threats and to help protect soldiers from improvised explosive devices,” Palantir disclosed in its filing. “Today, the platform is widely used by government agencies in the United States and its allies.”

Opinion: A tale of two $2 billion Chinese IPOs headed in very different directions

In 2016, Palantir launched a second platform, Foundry, that it has sold to commercial entities; Airbus SE
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was used as an example of a private-sector customer in the filing. The company said that it had only 125 customers as of the first half of this year, with a little more than half — 53% — coming from the private sector and the rest from government. Palantir collected an average of $5.6 million per customer in 2019, and its largest customers have a much larger average.

“Our top 20 customers, based on our revenue in 2019, generated $495.2 million in revenue, or 67% of our total revenue in that period. From those top 20 customers, we generated an average revenue per customer of $24.8 million during 2019,” Palantir disclosed in its filing. “Our average revenue per customer for our top 20 customers grew 36% to $15.0 million per customer in H1 2020 from $11.0 million per customer in H1 2019.”

Palantir said that it had contracts with government entities for an additional $1.2 billion in business on its books, and an additional $2.6 billion in “indefinite delivery, indefinite quantity” contracts that are not counted because the funding has not yet been determined.

“Our partnerships with government agencies in the United States and abroad have had and will continue to have a significant impact on our business,” the company stated.

The company said that its business has not been materially impacted adversely by the COVID-19 pandemic, and that it may help Palantir’s business.

See also: A ‘powerful force’ will determine what happens next in the stock market, Wharton professor predicts

“The pandemic has made clear to many customers that accommodating the extended timelines ordinarily required to realize results from implementing new software solutions is not an option during a crisis,” the company disclosed. “As a result, customers are increasingly adopting our software, which can be ready in days, over internal software development efforts, which may take months or years.”

Palantir revealed in its SEC filing that revenue grew to $742.6 million in 2019 from $595.4 million in 2018, while losses stayed even at more than half a billion dollars a year — $579.6 million in 2019 and $580 million in 2018. In the first six months of this year, Palantir recorded a loss of $164.7 million on revenue of $481.2 million, after recording a loss of $280.5 million on sales of $322.7 million in the same period of 2019.

Palantir joins a parade of software companies filing this week to enter the public markets. At least five software companies filed with the SEC on Monday, including Asana Inc., which was co-founded by a Facebook co-founder and will also undergo a direct listing. Snowflake Inc., Unity Software Inc., Sumo Logic and Jfrog Ltd. also filed for IPOs on Monday.



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