First quarter losses jolt Wayfair shareholders. Liberty Mutual teams up with MIT’s new AI research college. Charles River Labs reports its systems were hacked. Read on for more of this week’s Boston tech news.
— Losses were expected to continue at home goods e-commerce giant Wayfair (NYSE: [[ticker:W]]), but the sheer size of the red ink from the first quarter if the year caught investors off guard. Analysts predicted a loss of $1.60 per share for the quarter, but the company came in with a $2.20 a share hit. Wayfair stock—which closed the previous day at $163.48—plummeted 12 percent to a midday low of $143.84. Even as Wayfair’s results disappointed investors, it did post an increase in sales to $1.94 billion for the first quarter, from $1.4 billion in the same period last year.
—Masabi, a digital ticketing technology provider for transit services, has raised a $20 million Series C funding round led by Smedvig Capital with MMC Ventures to expand its software, Justride, which is used in Boston’s MBTA system as well as transit operations in New York, The Hague, Denver, Los Angeles, Spain, Sydney, and Las Vegas. The company’s software has started to integrate scooter- and bike-share systems as well as ride-hailing apps like Uber and Lyft to let users plan and pay for travel routes using multiple modes of transit. The company says it is on track to top $1 billion in annual ticket sales this year.
—ZeroNorth, a risk management software company formerly known as Cybric, has raised a $10 million Series A funding round led by ClearSky Ventures and joined by Crosslink Capital, Rally Ventures and Petrillo Capital. ZeroNorth has earmarked the funds for research and development, sales, and marketing for its platform. The company last raised $6.3 million in a 2016 seed round and has taken in $18.6 million so far. Peter Kuper and Patrick Heim from ClearSky Ventures and Art Coviello from Rally Ventures are joining the company’s board. ZeroNorth also hired John Steven to be its chief technology officer. Steven most recently was a senior director at security testing firm Synopsis (NASDAQ: [[ticker:SNPS]]).
—Chemical analysis device maker 908 Devices raised $17.5 in growth equity funding led by science and technology investor Northpond Ventures and joined by Sands Capital Ventures, ARCH Ventures, Razor’s Edge Ventures, Saudi Aramco Energy Ventures, Schlumberger, Tao Capital Partners, and Casdin Capital. 908 Devices says its tools are used in mass spectrometry analysis, biotherapeutics development, as well as chemical detection for first responders detecting fentanyl, explosives and chemical warfare agents.
—Boston-based property-casualty insurer Liberty Mutual is funding a $25 million, five-year collaboration with MIT on AI research in computer vision, computer language understanding, data privacy and security, and risk-aware decision making. The program will span MIT’s five schools and will be led by the new $1 billion computing college at MIT anchored by a $350 million donation from Blackstone Group Chairman Stephen A. Schwarzman. Fair game for the collaboration includes projects like making AI decision-making systems more transparent, using computer vision to identify dangerous driving conditions, and protecting anonymity and security of personal data.
—Online pet products marketplace Chewy has registered for an IPO. The company—which has headquarters in Boston and Dania Beach, FL—has not set the number or price of the shares it plans to sell. It included a placeholder amount to be raised of $100 million, though IPO firm Renaissance Capital estimated Chewy could end up raising as much as $800 million. Chewy was founded in 2011 and it booked $3.5 billion in sales during the 12 months ending January 31. It plans to list as “CHWY” but did not list an exchange where it would be traded. PetSmart acquired the company in 2017 for $3.35 billion and is now spinning out the subsidiary as a public company. Chewy is not profitable, but that hasn’t been a deterrent for other tech IPOs of late. The company reported a net loss of $267.8 million in its 2018 fiscal year.
—Contract research organization Charles River Labs (NYSE: [[ticker:CRL]]) reported a cybersecurity breach this week that led to unauthorized access of portions of its IT systems. The firm hired a cybersecurity firm to investigate and has launched a remediation plan. The company said it learned about the intrusion in mid-March, and alerted federal law enforcement agencies, which are investigating the incident.
“Based on the information available to date, we can state with confidence that there is no indication that data has been deleted, corrupted or altered. We do have evidence that a relatively small number of clients (approximately 1%) may have had some data that was copied, and we have already notified each of these potentially affected clients directly,” Charles River wrote in a letter to its clients that was later posted to its website. “The analysis of the fact pattern indicates that the intruders are highly sophisticated and well-resourced.”
