Facebook Parent Meta Platforms Net Falls 21%

Meta Platforms Inc said first-quarter 2022 total revenues increased 7% to $27.9 billion, net income declined 21% to $7.5 billion, and diluted earnings per share fell 18% to $2.72 from $3.30 a year ago. 

Facebook daily active users increased 4% to 1.96 billion and increased 6% to 2.87 billion across all its brands. 

Monthly active users across all the company platforms and brands increased 6% to 3.64 billion and rose 3% to 2.94 billion on Facebook platform. 

The advertising revenues in the U.S. and Canada increased $100 million to $12 billion, declined in Europe to $6.3 billion from $8.2 billion, and fell in Asia to $5.6 billion from $6.2 billion. 

In the quarter, capital expenditures increased to $5.5 billion from $4.4 billion a year ago. 

The company repurchased $9.39 billion of our Class A common stock in the first quarter of 2022 and as of March 31, 2022, the company had $29.41 billion available and authorized for repurchases.

Outlook

The company guided second quarter revenues between $28 billion and $30 billion. 

Nasdaq Erases 1.4% Rebound After Tech Stocks Lose Momentum

U.S. stocks opened higher and quickly reached the high of the day after thirty minutes of trading. 

The S&P 500 and Nasdaq Composite fell sharply after one hour of trading and tested low of the day. Indexes continued to rebound in the rest of the session till the final hour. 

At close, the S&P 500 index edged up 0.2% and the Nasdaq Composite Index fell 0.01%.   

Microsoft jumped 5% after reporting strong growth across all business segments and Alphabet Inc declined 4% after revenue growth disappointed investors. 

After the close Meta Platforms is scheduled to report earnings. Amazon and Apple are scheduled to report earnings on Thursday. 

U.S. 10-year Treasury bond yield increased a fraction to close at 2.82%.  

Crude oil edged up 45 cents to close at $102.15 a barrel and gained by the same amount to close at $105.20 in international trading. 

European markets closed up between 0.2% and 0.4%. 

Asian markets closed mixed with the Nikkei index in Tokyo down 1.2% and the Sensex index in Mumbai fell nearly 1%. 

The Indian government is set to open next week the trimmed public offering of Life Insurance Corporation. 

The LIC is the largest insurance company in India and the 221 million shares offering is set to raise at least $2.6 billion. 

LIC, the household name in India, has about 100,000 and has 250 million policyholders.  

Skechers Net Rises 23% On Record Quarterly Sales

Skechers USA Inc said first-quarter 2022 revenues increased 26.8% to $1.82 billion, net income rose 23% to $121.2 million, and diluted earnings per share increased to 77 cents from 63 cents. 

In the quarter, wholesale sales rose 32.7% and direct-to-consumer sales increased 16%. 

Domestic sales increased 28.7% and international sales rose 25.5%. 

By region, sales in the Americas rose 31% by double-digit increase in the U.S., APAC sales rose 4% driven by a 9% increase in China. 

Sales in Europe, Middle East and Africa surged 49% driven by strong growth in Europe. 

 Gross margin was 45.3%, a decrease of 250 basis points, driven by higher per unit freight costs partially offset by average selling price increases. 

In the quarter, the company repurchased 652,000 Class A common shares for $25 million and approximately $475 million remain available for the buyback program.

At the end of the quarter, the company opened 108 and closed 106 stores totaling 4,308. 

Guidance and Outlook 

In the second quarter, revenues are estimated between $1.75 billion and $1.8 billion and earnings per share between 50 cents and 55 cents. 

For the full-year the retailer guided sales between $7.2 billion and $7.4 billion and earnings per share between $2.75 and $2.95. 

Chipotle Revenues Rise 16%, Plans to Add 235-250 Restaurants

Chipotle Mexican Grill Inc reported first-quarter 2022 revenues rose 16% to $2 billion, net income increased 24.4% to $158.2 million, and earnings per share increased to $5.59 from $4.45 a year ago. 

Comparable restaurant sales increased 9% and digital sales increased to 41.9% of total food and beverage revenues. 

Restaurant-level operating margin declined 106 basis points to 20.7% and operating margin for the company increased to 9.4% from 9.3%. 

Operating margins at the restaurant-level declined on higher wages and higher food prices for beef, avocado, and paper costs.

Food, beverage and packaging costs in the first quarter were 31.0% of total revenue, an increase of 100 basis points from a year ago. 

The restaurant chain opened 51 new restaurants during the first quarter with 42 locations including a Chipotlane. 

Guidance and Outlook

The company plans to open between 235 and 250 new restaurants in the second quarter and guided comparable same store sales in the range between 10% and 12%. 

Movers: Boeing, CME, Carvana, CoStar, NCR, Skecher, Visa

The Boeing Company dropped 8.5% after the aerospace company reported lower than expected quarterly revenues of $14 billion and larger than expected loss of $2.75 per share. 

CME Group added 5.2% after the commodities exchange operator reported March quarter earnings per share of $2.11 compared to $1.79 a year ago. 

Revenues also jumped 7.4% to $1.35 billion on higher market volatility and average daily contract volume increased 19% to 25.9 million. 

Carvana declined 7.8% extended losses in the week to 23% after the company said it plans to raise as much as $2.8 billion in a junk bond offering to acquire the auction business of Adesa. 

CoStar Group added 6.3% after the real estate information provider reported better-than-expected earnings of 31 cents a share. 

Revenues in the first-quarter of 2022 increased 13% to $516 million and the company lifted its adjusted EPS and 2022 revenues estimate. 

F5 Inc plunged 12.8% after the computer networking company reported quarterly revenues increased to $634.2 million and net income rose to $56.2 million or 92 cents a share. 

The stock declined after the company guided lower than expected revenue range between $660 million and $680 million below the estimate of at least $690 million. 

MasterCard Inc added 5.6% after Visa reported quarterly earnings that beat the estimates and also offered a stronger outlook for the next quarter. 

Microsoft Corp advanced 7.2% after the software developer reported quarterly revenues rose 18% and net income rose 8%. Sales were strong across all segments including personal and enterprise computing, cloud segment, and Internet searches and social platforms. 

NCR Corp declined 24.01% and traded near a 52-week low after the computer systems maker reported first-quarter loss of 18 cents a share compared to 19 cents profit a year ago. Revenues increased to$1.87 billion from $1.54 billion in the prior year's quarter. 

The company also lowered its full-year revenue outlook to $8 billion from the previous range between $8 billion and $8.2 billion.  

Skechers U.S.A. Inc jumped 6.4% after the company said sales increased 25% to $1.82 billion and net income jumped 20% to $121.2 million or 77 cents a share. 

For the current quarter, the retailer guided revenues between $1.75 billion and $1.8 billion and earnings per share between 50 cents and 55 cents. 

Robinhood Markets, Inc  dropped 5.1% after the online broker said it plans to layoff 9% of its staff. The company is scheduled to release earnings on Thursday. 

The online broker rapidly grew in the first year of the pandemic and total headcount jumped to 3,800 from 700 in the period. 

The stock is down 73% from its first-day of close as a publicly traded company July 30, 2021.

Visa Inc gained 8.2% after the payment processing network operator reported quarterly revenues increased to $7.2 billion and net income rose to $1.70 a share. 

The company also said the current quarterly revenues are expected to increase in the upper end of the mid-teen percentage range and earnings are expected to match the latest quarter. 

Gross payment volume increased 17% and cross-border volumes rose 38% from a year ago. 

Stocks Rebound in New York and Europe, Russia Halts Gas Flow to Poland and Bulgaria

Market indexes opened higher and tech stocks led the rebound a day after the Nasdaq Composite hit the new low in 2022. 

The S&P 500 index opened up 0.3% and the Nasdaq Composite advanced 0.4%. 

Microsoft jumped more than 3% after reporting better-than-expected earnings and sales. 

Alphabet Inc, the parent of Google, fell 4% after investors were disappointed with the advertising revenue growth on YouTube social media platform. 

After the clos today, Meta Platforms is expected to report earnings and Apple and Amazon are scheduled to release earnings on Thursday. 

Crude oil edged down $1.30 to $100.30 a barrel and Russia halted its natural gas deliveries to Poland and Bulgaria. 

U.S. Treasury 10-year bond yield edged down to 2.74%. 

In international trading, European markets traded higher despite the deepening divisions between Russia and European nations. 

The DAX index in Frankfurt edged up 0.3%, in London the FTSE 100 index gained 0.7%, and in Paris Cac-40 index gained 0.5%. 

Asian markets opened lower following a plunge in Nasdaq in overnight trading but trimmed losses in India and in China. 

The Sensex index in Mumbai closed down 0.9%, the Nikkei index in Tokyo fell 1.2%, and the SSE index in Shanghai gained 2.5%. 

Covid-19 cases are on the rise in Beijing but cases in Shanghai declined for the fourth day in a row. 

Alphabet Revenue Growth Slows, Plans $70 Billion Buyback

Alphabet Inc reported first-quarter 2022 revenues increased 23% to $68 billion, net income fell 8.3%, diluted earnings per share eased to $24.62 from $26.29. 

The revenue growth in the first-quarter eased to 23% from 34% a year ago and in constant currency slowed to 26% from 32% respectively. 

Total advertising revenues increased 20% to $61.4 billion from $51.2 billion, search revenues increased 25% to $39.6 billion from $31.9 billion, Google Network revenues rose to $8.2 billion from $6.8 billion, and YouTube revenues advanced 13% to $6.8 billion. 

The company's board authorized a share repurchase plan of $70 billion. 

Microsoft Quarterly Revenues Up 18%, Net Income Up 8%

Microsoft Corp reported March quarter revenues rose 18% to $49.4 billion, net income rose 8% to $16.7 billion, and earnings per share 9% to $2.22. 

Server products and cloud services revenue increased 29%, in Productivity and Business Processes rose 17% to $15.8 billion, and in Personal Computing segment rose 11% to $14.5 billion. 

LinkedIn revenues rose 34%, Xbox content and services revenues rose 6%, Surface revenues increased 13%, and search and news advertising revenues excluding traffic acquisition costs increased 23%. 

Microsoft returned $12.4 billion to shareholders through share repurchases and dividends in the quarter, an increase of 25% from a year ago period. 

Nasdaq Plunges 4% Extending Year's Loss to 21%

The S&P 500 and Nasdaq Composite accelerated market declines in the afternoon after nervous investors decided to sell tech stocks ahead of earnings and avoid Netflix-type blow ups. 

The Nasdaq Composite fell 4% and fell further in bear zone with year-to-date losses of 22%. 

The S&P 500 index declined 2.8% today and extended year-to-date losses to 13%. 

Netflix dropped 4% and Microsoft, Alphabet, Meta Platforms, and Apple fell more than 3%. 

Banks were down on the growing worries that the economic slowdown maybe in the cards for the rest of the year. 

Wells Fargo, JPMorgan Chase, Citigroup, and Bank of America declined more than 2%. 

Crude oil jumped $3.52 to close at $102.03 a barrel and 10-year U.S. Treasury yield eased to 2.746%. 

Movers: Arch Resources, Carvana, Sherwin Williams, Tesla, Waste Management

Arch Resources surged 20% after the coal miner reported quarterly earnings per share of $12.89 compared to loss of 40 cents a year ago. 

The mining companies also declared a special dividend of $7.86 and standard dividend of 25 cents. 

The company has coal commitments between 83 million tons and 87.8 million tons for 2022. 

Carvana Co plunged 11.8% after the stock was downgraded by Deutsche Bank and the company last week reported first-quarter loss of $506 million compared to $82 million a year ago. 

The company also said it is planning to sell $1 billion of stocks and raise additional $2.3 billion in unsecured debt to finance acquisition of its auction unit Adesa. 

JetBlue Airways sank 11% after the airline said it is planning to shrink its capacity by 5% and layoff staff from its previous plan to increase by 15% compared to 2019. The company said it plans to shrink the spring and summer schedule by 5% to 8%. 

Sherwin-Williams jumped 9% after reporting quarterly sales of $5 billion, an increase of 7.4% but earnings per share declined to $1.41 from $1.51. Adjusted earnings of $1.61 a share were ahead of estimates between $1.51 and $1.53. 

Tesla Inc plunged 11% after the company's CEO Elon Musk agreed to acquire Twitter Inc for $44 billion. About 33% or $60 billion of Musk's Tesla holdings are placed under collateral to finance the purchase.  

Waste Management jumped 5% after reporting first-quarter revenues of $4.66 billion and adjusted earnings per share $1.29 a share. GAAP-based earnings per share increased to $1.23 from 99 cents a year ago. 

The waste management company said revenues rose on growth in waste collection volume and improvement in yields in disposals. 

UPS Revenues Jump on Price Increases, Shipment Volumes Fall

UPS reported first-quarter 2022 revenues increased 6.4% to $24.4 billion, earnings fell 47% to $2.4 billion, and earnings per share declined to $3.03 from $5.47. 

After adjusting the $2.86 per share or $3.6 billion of gains related to pension and other one-time costs comparable earnings per share in the quarter a year ago were $2.77 a share. 

Total domestic package volumes declined to 19.7 million from 20.4 million a year ago. Total international package volume declined to 3.5 million from 3.8 million and consolidated package volume fell to 23.2 million from 24.1 million a year ago. 

Average revenue per piece for domestic package rose to $11.97 from $10.93 and consolidated revenues per piece increased t0 $13.26 from $12.12 a year ago. 

Revenues in the U.S. domestic segment increased 8% to $15.1 billion and operating profit rose to $1.6 billion from $1.4 billion. Revenue for piece increased 9.5%. 

Revenues in the international segment rose 5.8% to $4.87 billion and operating profit increased 9% to $1.1 billion. Revenues per piece increased 10.5%. 

Revenues in the Supply Chain Solutions segment rose 2% to $4.4 billion and operating profit rose to $473 million from $213 million. 

The company announced its plans to double the amount of share repurchases for 2022, taking the target to $2 billion for the year.

Guidance & Outlook 

For 2022, UPS reaffirms its full-year financial targets: 

Consolidated revenue of about $102 billion 

Consolidated adjusted operating margin of approximately 13.7% Adjusted return on invested capital above 30% 

Capital expenditures of 5.4% of revenue, or approximately $5.5 billion 

Dividend payments, subject to board approval, of about $5.2 billion 

PepsiCo Net Benefits from Higher Prices and Volumes, Lifts Outlook

PepsiCo, Inc reported first-quarter 2022 revenues increased 9.3% to $16 billion, net income rose 148% to $4.2 billion, and earnings per share increased by the same amount to $3.06 from $1.24 a year ago. 

Excluding $3.3 billion benefits from the sale of certain juice brands in North America and Europe, earnings per share were $1.29. 

organic revenues increased 13.7% and core earnings per share was $1.29 and increased 7% on constant currency basis. 

Impact of exiting from Russia business was $193 million after taxes or 14 cents a share and including all impairment linked to Russia-Ukraine conflict add to $241 million or 17 cents per share. 

Frito-Lay North America segment reported quarterly case volume increased 1% and revenues rose 14%. 

Quaker Oats North America segment quarterly revenues rose 11% but case volume declined 1.5%. 

Pepsico Beverage North America case volume increased 3% and revenues rose 5.5%. 

Guidance and Outlook 

For the full-year the company lifted its estimate of organic revenue growth to 8% from the previous estimate of 6%. 

The food products and beverage maker reiterated its full-year core earnings per share outlook to 8%. 

Lagging Indicator of Home Prices Jumps 20% in February

S&P 500 Case-Shiller National Home Price index jumped 19.8% in February to 286.68 from a year ago.    

The index tracks home prices across the nation and reached a new-high since the first value was calculated in January 1987.     

The 10-city index showed an annual increase of 18.6% from 17.3% in January. The 20-city index increased 20.2% after gaining 18.9% in the previous month.     

All 20 cities reported a price increase in February compared to 16 cities in January.    

 Sun-belt cities home prices jumped at a faster pace above the national averages as home builders struggled to add homes. 

Prices in Phoenix soared 32.9%, in Tampa jumped 32.6%, and in Miami advanced 29.7%.    

Home prices in Minneapolis and  Washington, D.C. rose 11.9% and New York jumped 12.9%, the smallest gains in 20 cities tracked by the index but still advanced in double-digits.       

Home price index is generally considered a lagging indicator of market environment and generally lags home sales and median price data trend.     

Pending home sale contracts have been falling for the last four months in a row and March data is scheduled to be released on Wednesday.     National home price index increased 10.4% in 2021 and 3.7% in 2020. 

Nasdaq Down 2% On Tech Earnings Jitters

Benchmark indexes opened down and quickly lost more than 1.5% following a day when market indexes staged a sharp reversal in the afternoon trading on Monday. 

After 45 minutes of trading, the S&P 500 index declined 1.4% and the Nasdaq Composite index dropped 2%. 

The S&P 500 and Nasdaq indexes rebounded 2% from the bottom reached at midday to close up on Monday. 

The S&P 500 closed up 0.6% and the Nasdaq Composite gained 1.3%.

For April, the Nasdaq is still down 8% and the S&P 500 is down 5%. In the year so far, the Nasdaq has lost 19.5% and the S&P 500 has declined 10.4% 

Investors showed a burst of enthusiasm ahead of earnings from tech leaders  Microsoft, Google parent Alphabet, and Meta Platforms Inc. 

About 700 companies are scheduled to release earnings including about 130 companies in the S&P 500 index. 

Pepsico reported better-than-expected earnings of $4.26 billion from $1.71 billion a year ago. Earnings per share jumped to $3.06 from $1.24 a share. 

S&P CoreLogic Case-Shiller national home price Index showed prices rose 19.9% in February from a year ago. The index showed a gain of 19.1% in January. 

European markets are up between 0.4% and 0.6% in Frankfurt, Paris, and London. 

Asian markets closed higher but the Shanghai index lost 1.4% extending three-day losses. 

Mega Cap Techs Drive Market Reversal, Twitter Says Yes to Musk

The S&P 500 and Nasdaq Composite indexes made a reversal in the afternoon trading after crude oil prices and bond yields eased and investors hunted for bargains ahead of earnings from large tech companies. 

The Nasdaq Composite fell to 12,727 and reversed to close up 1.3% to 13,004.85, a reversal of more than 2.5%. 

The S&P 500 index also reversed earlier losses at mid-day and gained 2% to close up 0.6%.  

Microsoft, Google parent Alphabet, Apple and other leading tech companies are scheduled to release earnings after the close tomorrow. 

Coca-Cola closed nearly unchanged after reporting better-than-expected quarterly earnings and reaffirmed its outlook for $10.5 billion free cash flow in the year. 

Oil complex stocks dropped as much as 6% and recovered to close down only 2% to 3% after crude closed down 3.5% near $100 a barrel price. 

Bond yield eased and the 10-year U.S. Treasury closed at 2.822%.