- Scott Peters
- 07 Feb, 2023
- New York City
Activision Blizzard increased 4.3% to $74.75 after the computer game maker reported better-than-expected earnings.
Activision Blizzard said revenue in the fourth quarter increased 7% to $2.3 billion but net income plunged 29% to $403 million and diluted EPS fell to 51 cents from 72 cents a year ago.
For the quarter, Activision Blizzard’s net bookings jumped 43% to $3.57 billion from $2.49 billion and In-game net bookings rose $1.82 billion from $1.24 billion a year ago.
BP Plc increased 5.7% to $36.81 after the energy explorer reported bumper profit reflecting higher crude oil, gasoline and natural gas prices.
BP Plc said group revenue increased 34.5% to $70.2 billion and net income soared more than four-fold to $11.1 billion from $2.6 billion and diluted EPS rose to $3.50 from 70 cents a year ago.
BP repurchased $3.2 billion of stock in the quarter including $2.5 billion repurchase announced in the previous quarter.
Chegg Inc dropped 20% to $16.70 after the online student support service provider forecasted weak subscriber growth.
Chegg said the fourth quarter revenue declined 1% to $205.2 million and net income dropped to $1.9 million from $24.3 million and diluted EPS fell to 1 cent from 15 cents a year ago.
Chegg said services subscribers increased 5% to 8.2 million in the full-year 2022.
Cummins Inc decreased 1.1% to $248.20 after the industrial company reported a decline in net income in its latest quarter.
Cummins said revenue in the fourth quarter rose 35% to $7.8 billion and net income increased 6% to $631 million and diluted EPS increased to $4.43 from $2.73 a year ago.
For the full-year 2022, revenue increased 17% to $28 billion and net income rose to $2.15 billion from $2.13 billion and diluted earnings per share rose to $15.12 from $14.61 a year ago.
For the full-year 2023, Cummins estimated revenue to increase between 12% and 17% and operating earnings to increase between 14.5% and 15.2%
Hertz Global increased 7.5% to $19.07 after the rental car service provider swung to profit following a rebound in travel.
Hertz said sales in the fourth quarter rose 4% to $2 billion and swung to a net income of $116 million from a loss of $710 million and diluted loss per share was 1 cent compared to $1.52 a year ago.
Average rentable vehicles increased 3% to 465,943 and vehicle utilization increased to 79% from 78% a year ago.
Excluding litigation settlements of $168 million in the quarter, direct operating expense per transaction day was $33, down $2 from the third quarter 2022, reflecting improved operating leverage.
Pinterest Inc declined 6.2% to $26.12 after the social media platform operator reported a sharp decline in earnings.
Pinterest said revenue in the fourth quarter increased 4% to $877 million and net income dropped 90% to $17 million from $174.7 million and diluted EPS fell to 3 cents from 25 cents a year ago.
Pinterest also announced that its board of directors has authorized a stock repurchase program of up to $500 million of its Class A common stock over the next 12 months.
Royal Caribbean soared 9.2% to $75.46 after the cruise operator reported an upbeat outlook.
Royal Caribbean said revenue in the fourth quarter rose 160% to $2.6 billion and net loss shrank to $500 million from $1.4 billion and diluted loss per share fell to $1.96 from $5.33 a year ago.
The company said bookings are approaching previous record highs and at higher prices.
In the fourth quarter, RCL said load factors were in line with guidance at 95%, with Caribbean sailings reaching 100%, and holiday sailings close to 110%.
- Barry Adams
- 06 Feb, 2023
- New York City
U.S. stocks struggled to advance in the face of rising Treasury yields for the second day in a row.
Stocks faced headwinds for the second trading day in a row after bond yields rose 12 basis points after rate worries resurfaced following an unexpected surge in the non-farm payrolls in January.
The U.S. dollar index advanced against a basket of major currencies and rose above 105 and traded near the level seen in early January.
Markets are also awaiting earnings from about 500 companies this week including quarterly results from Chipotle, PepsiCo, Uber and Walt Disney.
Investors are looking to get insights in how companies are navigating a strong dollar, rising input costs and managing labor costs ahead of the possible economic slowdown.
Dell Inc was the latest tech company to announce a layoff and the maker of computers said it plans to lay off about 5% of its staff.
The maker of personal computers is struggling with a sharp fall in PCs and laptops but server sales are holding up better-than previously anticipated.
U.S Indexes In Review
The S&P 500 index fell 0.6% to 4,111.08 and the Nasdaq Composite index declined 1.0% to 11,887.45.
Crude oil gained $1.12 to $74.15 a barrel and natural gas rose 7 cents to $2.48 a thermal unit.
The yield on 2-year Treasury notes inched up to 4.47%, 10-year treasury notes edged higher to 3.67% and 30-year Treasury notes traded up to 3.68%.
U.S. Stock Movers
Dell Technologies Inc declined 3% to $40.99 after the maker of personal computers announced a plan to lay off about 5% its staff.
The company expects to recognize expenses associated with these actions in the fourth fiscal quarter of fiscal 2023, according to a regulatory filing with the Securities and Exchange Commission.
"The steps we’ve taken to stay ahead of downturn impacts – which enabled several strong quarters in a row – are no longer enough. We now have to make additional decisions to prepare for the road ahead," Vice Chairman and Co-chief Operating Officer Jeff Clarke said.
"Unfortunately, with changes like this, some members of our team will be leaving the company," Clarke added.
Energizer Holdings dropped 5.3% to $35.29 after the battery maker reported weaker-than-anticipated quarterly results.
Sales in the fourth quarter or the fiscal first quarter ending in December decreased 9.6% to $765.1 million from $846.3 million a year ago.
Net income dropped to $49 million from $60 million and diluted earnings per share decreased to 68 cents from 83 cents a year ago.
The company reiterated its fiscal 2023 outlook, , with organic revenue expected to increase low single digits, adjusted EBITDA in the range of $585 million to $615 million, and adjusted earnings per share in the range of $3.00 to $3.30.
"We still expect low single digit declines for reported revenues with currency headwinds of approximately $50 million and anticipate negative currency headwinds on pre-tax earnings of approximately $20 million and $0.23 per share, based on current rates," the company said in the earnings release.
ON Semiconductor Corp declined 0.6% to $80.39 after the company said revenue in the fourth quarter increased 14% to record $2.1 billion.
Net income in the period rose to $604.3 million from $425.9 million and diluted earnings per share increased to $1.35 from 96 cents a year ago.
The company also announced a new share repurchase program with authorization to repurchase up to $3 billion of shares of the company's common stock through December 31, 2025.
Euro Area Retail Sales Fell In December
The seasonally adjusted retail sales volume in the Euro Area decreased 2.7% in December after rising 1.2% in November, according to an estimate from Eurostat, the statistical office of the European Union.
The retail sales declined 2.8% on an annual basis in December from a year ago.
For all of 2022, retail sales in the Euro Area barely increased 0.7% and rose 1.1% in the European Union.
German Factory Orders and Sales In Focus
Separately, the Destatis or the Federal Statistics Office of Germany said seasonally and price adjusted factory orders rose 3.2% on a monthly basis in December after falling 4.2% in November.
December orders declined 0.6%, excluding large orders for electric utilities and aircraft and internal combustion engines.
On a yearly basis, December orders declined 10.1% in December.
German factory orders adjusted on a calendar basis in December are slightly ahead of pre-pandemic level by 1.2% from December 2019.
However, sales of manufacturing companies fell 1.7% in December from November and rose 1.9% from a year ago.
European Indexes Trend Lower
European market indexes traded lower after stronger-than-expected U.S. jobs data for December dashed hopes that the U.S. Federal Reserve may pause its rate tightening cycle soon.
The DAX index decreased 0.9% to 15,335.39, the CAC-40 index declined 1.5% and the FTSE 100 index dropped 0.9% to 7,825.82.
The yield on 10-year German Bunds inched up to 2.28%, French bonds increased to 2.73%, UK Gilts to 3.26% and Italian bonds to 4.14%.
Brent crude oil fell 4 cents to $79.89 and the Dutch TTF Spot price inched lower 71 euro cents to Є57.18 per MWh.
The euro declined to $1.07, the British pound edged lower to $1.205 and the Swiss franc eased to 92.75 U.S. cents.
Europe Movers
Aurubis AG declined 4.8% to €96.44 after the German copper smelter reported a sharp fall in earnings.
Revenue in the fiscal first quarter ending in December 2022 declined 7% to Є4.1 billion.
Net income dropped to Є57 million from Є301 million and diluted earnings per share plunged to Є1.31 from Є6.89 a year ago.
Higher energy and other input costs negatively impacted quarterly results.
Diageo Plc declined 0.2% to 3,572.15 pence after the British spirits maker launched a partial offer to increase its stake to 65% from the current stake of 50% in East African Breweries Plc.
The tender offer price is Kenyan Shillings 192.00 per ordinary share and the maximum number of shares subject to the tender offer is 118,394,897.
The tender offer period will run from 6 February 2023 to 17 March 2023, Diageo said in a statement released today.
Weaker Yen Drags Tokyo Stocks
Asian markets also cooled in overnight trading following the Friday's release of U.S. jobs report.
The yen fell 1% after the U.S. dollar advanced in the region's trading on the hopes of a continuation of the tightening cycle by the Federal Reserve after the jobs report signaled tighter-than-expected labor market conditions.
The Nikkei 225 average increased 0.7% to 27,693.65 and the yen weakened to 132.78 against the U.S. dollar.
Rising U.S.-China Tensions Knock China Stocks Lower
Markets in Mainland China and Hong Kong were under pressure after tensions between the U.S. and China rose after the U.S. shot down a Chinese spy-balloon off the coast of North Carolina.
Secretary of State Antony Blinken also canceled his visit to Beijing after the Pentagon's discovery of the alleged spy-balloon.
Chinese authorities said that China came to know that one of its "weather monitoring balloons" had drifted in the U.S. airspace only after it was informed by the United States.
“China is a responsible country. After the United States notified China, we immediately checked and gave feedback, and clearly requested the United States to act calmly, professionally, and handle it in a restrained manner,” China's foreign ministry spokeswoman Mao Ning said.
The Shanghai Composite index decreased 0.7% to 3,238.70 and the Hang Seng index fell 2% to 21,222.16.
Weaker Rupee and Adani Group Worries Overshadow India Stocks
Stocks in Mumbai traded lower after the U.S. dollar rose and U.S.-China tensions rose and Adani Group stocks fell for the third week in a row despite supportive comments from the government and business leaders.
The Sensex index decreased 0.5% 334.98 points to 60,506.90 and the Nifty index dropped 0.5% or 89.45 points to 17,764.60.