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Business

Stock futures dip as investors look to economic data, Fed speeches

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Stock futures traded lower Thursday, building on the losses from the previous session, as rate and recession fears dented market sentiment.

Futures tied to the Dow Jones Industrial Average fell 224 points, or 0.7%. S&P 500 futures and Nasdaq 100 futures shed 0.7% and 0.9%, respectively.

Wall Street is coming off a losing session. The S&P 500 tumbled 1.56% on Wednesday for its worst day since Dec. 15. The Dow shed more than 613 points, or 1.81%. The tech-heavy Nasdaq Composite fell 1.24%, snapping seven-straight days of gains. Bank stocks such as JPMorgan, Bank of America and Wells Fargo slid, weighing on the broader market.

Disappointing retail sales and a weaker-than-expected producer price index reading ignited recession fears, sending stocks lower.

On Thursday, investors will weigh more economic data that could give further clues as how much the Fed may raise interest rates in its upcoming meeting. Initial jobless claims, housing starts and the Philadelphia Federal Reserve’s manufacturing survey will be released in the morning. Several central bank leaders including Fed Vice Chair Lael Brainard will also speak throughout the day on the path forward.

Investors have been parsing through the latest data and Fed remarks for clues on how high rates will go. But, while recent numbers point to easing inflation, JPMorgan Chase CEO Jamie Dimon thinks rates will top 5%.

“I think there’s a lot of underlying inflation, which won’t go away so quick,” Dimon told CNBC’s “Squawk Box” from the World Economic Forum in Davos, Switzerland.

Investors will also be watching key quarterly reports to see if there is an earnings recession brewing. Netflix and Truist Financial are among companies reporting earnings on Thursday.

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Business

Coinbase, Roblox, Wendy’s and more

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Check out the companies making headlines in midday trading.

Coinbase reported a 27% decline in revenues in the first quarter as usage of the platform dipped.

Chesnot | Getty Images

Coinbase – Shares of the crypto services operator jumped about 6% despite the company reporting a wider-than-expected loss late Tuesday and a decline in volumes in the most recent quarter. The rally coincided with a move higher in bitcoin after a key inflation reading showed a better-than-expected slowdown in rising prices.

Wendy’s – The restaurant chain saw its shares fall more than 2% after reporting a revenue miss. U.S. same-restaurant sales rose 2.3% — less than analysts had estimated — as consumers spent more cautiously. Wendy’s earnings in the latest quarter topped estimates, however.

Roblox – Shares of the video game platform were down 5% in midday trading after postmarket earnings Tuesday missed analyst expectations. Roblox’s quarterly loss was wider than expected, and its bookings, which include sales recognized during the quarter and deferred revenue, declined by 4% year over year.

Twitter – The social media company climbed more than 3% after Elon Musk disclosed the sale of nearly $7 billion in Tesla shares in the past few days. Investors are uncertain whether a Delaware Chancery court will force Musk to follow through on his deal to buy Twitter for $44 billion. Shares of Tesla gained more than 2.5%.

Sweetgreen — Shares dropped 5% after the salad chain lowered its full-year forecast, and second quarter revenue missed analyst estimates. Sweetgreen also said it laid off 5% of support center employees.

Trade Desk — Shares of the digital advertising firm soared 35% after it gave an upbeat forecast for the current quarter and revenue beat estimates in the quarter just ended.

Fox — The media company rose 4% even after Fox missed estimates on the top and bottom lines in the latest quarter. Earnings per share came in 1 cent below estimates.

Unity Software — The software company jumped more than 7% after Unity reported an adjusted loss of 18 cents per share, three cents better than estimates, according to Refinitiv. Unity’s revenue and guidance were lower than expected. The stock is now trading within 10% of $58.85 per share, which is the price offered by AppLovin in a nonbinding merger proposal earlier this week.

H&R Block — The tax preparation services company jumped more than 12% after it raised its dividend and authorized a new $1.25 billion buyback. H&R Block also beat top and bottom line estimates in the most recent quarter.

BuzzFeed — BuzzFeed slumped 4.3% after posting earnings. The company reported a bigger-than-expected loss per share, noting that it faces rising costs and a troublesome advertising market.

— CNBC’s Tanaya Macheel, Sarah Min, Carmen Reinicke, Jesse Pound, Michelle Fox and Yun Li contributed reporting.

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Business

Wendy’s, Coinbase, Buzzfeed and more

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Check out the companies making headlines before the bell:

Wendy’s (WEN) – Wendy’s shares fell 1% in premarket trading following a mixed quarter, which saw the restaurant chain report better-than-expected earnings while revenue fell short of Street forecasts. U.S. same-restaurant sales rose 2.3%, less than analysts had estimated, as consumers spent more cautiously.

Coinbase (COIN) – The cryptocurrency exchange operator’s shares slid 5% in the premarket after the company reported a wider-than-expected quarterly loss, with business impacted by the slide in crypto prices during the spring months. Coinbase saw volumes fall as the number of active traders declined during the quarter.

Buzzfeed (BZFD) – The digital media company reported a wider-than-expected quarterly loss amid a pressured advertising market and rising expenses. Buzzfeed fell 3.7% in premarket trading.

Twitter (TWTR) – Twitter added 3.6% in premarket action following news that Elon Musk sold nearly $7 billion in Tesla (TSLA) shares over the past few days. The move comes amid uncertainty over whether a court will force Musk to follow through on his $44 billion deal to buy Twitter. Tesla shares gained 1.3%.

Roblox (RBLX) – The videogame company’s stock tumbled 15.1% in the premarket after Roblox reported a quarterly loss that was wider than expected and bookings – a key sales metric – fell short of analyst forecasts.

Wynn Resorts (WYNN) – The resort operator reported a smaller-than-expected quarterly loss, but revenue was shy of expectations as results in Macau continue to be pressured by Covid-related shutdowns. Wynn Resorts fell 2.9% in premarket trading.

Trade Desk (TTD) – The digital advertising firm’s stock surged 16.3% in the premarket after it reported better-than-expected quarterly revenue and gave an upbeat forecast for the current quarter. The company said its performance gives it confidence that it can gain market share in any economic environment.

H&R Block (HRB) – The tax preparation firm’s stock jumped 4% in premarket action after quarterly results were better than expected, helped by a strong tax season. H&R Block also announced a 7% dividend increase and a new $1.25 billion stock buyback program.

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Business

Stocks making biggest after hour moves: Coinbase, Roblox and more

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In this photo illustration, the Coinbase logo is displayed on a smartphone screen.

Rafael Henrique | SOPA Images | Lightrocket | Getty Images

Check out the companies making headlines in after hours trading.

Coinbase – Coinbase fell more than 3.5% in afterhours trading after reporting quarterly earnings. The company missed analyst expectations on both revenue and earnings, partially due to the “crypto winter” seen in the second quarter.  

Roblox – Roblox shed nearly 14% postmarket Tuesday after the company’s quarterly earnings came in below Wall Street expectations. Roblox reported a loss of 30 cents per share and $639.9 million in revenue, versus analysts’ estimate of a loss of 21 cents on $644.4 million in revenue. In addition, Roblox reported 52.2 million daily active users in the quarter, less than expected by Wall Street and down from the first quarter.

Wynn Resorts – Shares of Wynn Resorts slipped more than 2.5% late Tuesday after the gaming company missed Wall Street’s estimates for revenue. Wynn reported a loss of 82 cents per share and revenue of $908.83 million, against analysts’ estimates of a loss of $1.11 and revenue $980.85 million.

Unity Software – Unity Software shed nearly 3% after the closing bell after disappointing quarterly earnings that missed Wall Street expectations. Unity reported $297 million in revenue and a 69-cent loss per share, versus expectations of $299 million in revenue and a 21-cent loss.

Sweetgreen – Shares of the salad company lost more than 20% in afterhours trading Tuesday after it lowered its full-year outlook, said it would layoff 5% of its workforce and downgrade its office space. The company met earnings expectations, reporting 36 cents per share, but fell short on revenue, reporting $124.9 million versus $130.2 million expected.

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Business

Roblox CEO David Baszucki says bookings are turning around

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Roblox CEO David Baszucki told CNBC on Wednesday that the company is seeing its bookings recover in April after the company said earlier this week that they declined 3% in the March quarter.

Bookings are how the company describes sales of its virtual currency, Robux, which players use to buy digital items such as avatars and other premium features.

Roblox is a virtual world game particularly popular with children that’s played on phones, PCs and game consoles. Players can inhabit virtual worlds, play games and even sell their creations to other players.

Baszucki told Jim Cramer in a “Mad Money” interview that bookings fell partially because the company saw boosted user engagement last year during the Covid pandemic, which has subsided.

“March was a very difficult compare. We were all locked down a year ago,” Baszucki said. “We’re happy that in April, we’ve seen that start to turn around. We think longer term, we’ll see booking start to catch up with user growth.”

After the closing bell Tuesday, Roblox reported disappointing first-quarter results, which prompted investors to sell the stock. It plunged 10% in after-hours trading Tuesday. However, it closed Wednesday up nearly 3.4% in a major turnaround. While it’s unclear what drove the surge, the company appeared bullish about the current quarter’s growth rates.

Roblox recorded a per-share loss of 27 cents in the first quarter, which was wider than expectations. Revenue and active daily users also came in light. The company said it was optimistic about growth rates in the current quarter and that the summer could represent a growth opportunity.

Roblox is also starting to more seriously develop alternative sources of sales and new users for the virtual world, Baszucki said. As economies emerge from the pandemic, Roblox will push for new search features and easier partnerships with brands and to expand the amount of user-generated content (UGC) sold on the platform.

“I think this quarter is the first time we’ve come out and said look, we’re going to nudge a bit towards the efficient frontier on our economy, both around how we do search and discovery, the amazing possibilities for how brands can bring traffic, and also our UGC catalog, which has an enormous amount of economic activity,” he said.

One possibility in the future is that Roblox could be used to connect co-workers in an enterprise setting, the Roblox CEO told Cramer. “Someday we’ll use Roblox in our own office to stay connected as some of our people work remotely,” he envisioned.

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Business

Cramer’s lightning round: Hertz is worth buying

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Cedar Fair LP: “I like that one very much, you stay there [and don’t sell] … I think the stock goes much higher.”

Ciena Corp: “I don’t really care for CIEN, because I’ve got Cisco all the way down here at $55 [a share], and they just reported an unbelievable quarter. Why do we have go down to Ciena?”

Roblox: “It’s too low to sell … you’ve got to start making things and do stuff and make them money doing it, and return to shareholders. Now, the company does not do the latter two, and that’s why it will not go up very much.”

Hertz Global Holdings Inc.: “Smart money is dumb. They should be buying this thing. [Stephen] Scherr is the CEO. He used to be the Goldman CFO. He is dynamite and he’s going to come on the show. Now, he doesn’t know that, but he will.”

MP Materials Corp: “I think MP’s real. … They promised, they delivered, and it goes higher and I like them.”

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Business

Roblox stock dives 24% after earnings miss

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Nike is teaming up with roblox to launch a virtual world called Niketown.

Source: Nike

Roblox shares are down more than 24% after reporting earnings that missed expectations.

The gaming company reported earnings on Tuesday after the bell that missed Wall Street estimates on the top and bottom line. It noted $770 million in revenue (bookings) compared to the $772 million expected, per Refinitiv consensus estimates, for the fourth quarter. It also reported a 25 cent loss per share, worse than the 13 cents loss per share expected. Roblox said it had 49.5 million daily active users during the quarter, up 33% year-over-year.

Roblox is an open gaming platform that lets players create their own interactive “worlds.” It was the first major company working on the metaverse to go public. The company sells virtual currency to players, which is used to purchase digital items in the game. The company recently partnered with companies like Nike and the NFL.

Analysts were concerned about the slowdown in bookings and outlook.

“Our key takeaway from Roblox’s 4Q update… January 22′ bookings experienced a deceleration relative to past months, up just 2%-3%, y/y as compared to October/November/December ’21 at +15%/+23%/+21%, respectively, for example,” Stifel analysts said in a note on Tuesday evening.

“Furthermore, the company indicated y/y bookings comps, “should improve starting in the May-June timeframe,” leaving us to ponder what this suggests for February-April. Why the anticipated slowdown?”

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Business

Generac, Shopify, La-Z-Boy and others

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Check out the companies making headlines before the bell:

Generac (GNRC) – The maker of generators and power equipment saw its stock rise 2.6% in the premarket after beating top and bottom-line estimates for the fourth quarter. Generac earned an adjusted $2.51 per share, 11 cents above estimates, as both commercial and residential sales increased more than 40%.

Shopify (SHOP) – Shopify fell 4% in premarket action despite reporting better-than-expected quarterly profit and revenue. The e-commerce platform operator said revenue growth for 2022 would be slower than the 57% it achieved in 2021.

Kraft Heinz (KHC) – The food maker’s stock was up 1.3% in the premarket after reporting its adjusted quarterly profit of 79 cents per share beat estimates by 16 cents. Revenue was also above Wall Street forecasts.

La-Z-Boy (LZB) – La-Z-Boy tumbled 12.5% in premarket trading after the furniture company reported a quarterly profit of 65 cents per share, well below the 89-cent consensus estimate. The company best known for its signature recliners noted multiple production issues related to Covid-19, leaving it unable to fully satisfy demand.

Wynn Resorts (WYNN) – Wynn Resorts reported a quarterly loss of $1.37 per share, wider than the $1.25 per share loss expected by Wall Street analysts, although the casino operator’s revenue beat estimates. A nearly 28% drop in Wynn’s Macau revenue weighed on overall results. Wynn fell 2.3% in the premarket.

Trade Desk (TTD) – The stock surged 10.5% in the premarket after the programmatic ad company reported adjusted quarterly earnings of 42 cents per share, 14 cents above estimates, with revenue also topping Wall Street forecasts.

Hilton (HLT) – The hotel operator missed estimates by 2 cents with adjusted quarterly earnings of 74 cents per share. Revenue was slightly above estimates as it more than doubled from a year earlier amid a travel recovery.

ViacomCBS (VIAC) – ViacomCBS announced it will change its corporate name to Paramount Global, effective Thursday, in an effort to emphasize its Paramount+ streaming service and to take advantage of Paramount’s brand recognition. Separately, the media company reported an adjusted quarterly profit of 26 cents per share, missing the 43-cent consensus estimate. Shares slumped 11.3% in premarket trading.

Airbnb (ABNB) – Airbnb reported record revenue for 2021, better-than-expected fourth-quarter results, and issued an upbeat current-quarter forecast. The home rental company benefited from consumer preferences shifting away from hotels during the pandemic and said current-quarter bookings are likely to exceed pre-pandemic levels for the first time. Airbnb shares rallied 3.5% in the premarket.

Roblox (RBLX) – Roblox stock plummeted 15.2% in premarket action after reporting a loss of 25 cents per share for its latest quarter, nearly double the 13-cent loss analysts had anticipated. The social gaming platform operator also saw lower-than-expected revenue amid flat daily active user metrics and engaged gaming hours that fell short of forecasts.

Cedar Fair (FUN) – Cedar Fair rejected a takeover bid from rival theme park operator SeaWorld Entertainment (SEAS), according to a statement by SeaWorld which confirmed earlier reports of an offer but did not acknowledge the reported $3.4 billion price. Separately, Cedar Fair reported better-than-expected quarterly revenue with record in-park spending by visitors. Cedar Fair stock slid 12.3% in the premarket, while SeaWorld fell 4.2%.

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Business

Airbnb, Roblox, Wynn Resorts & more

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The Airbnb logo is seen on a little mini pyramid under the glass Pyramid of the Louvre museum in Paris, France, March 12, 2019.

Charles Platiau | Reuters

Check out the companies making headlines in after-hours trading:

Airbnb — Shares of the property rental company advanced 5% during extended trading Tuesday following the company’s fourth-quarter results. Airbnb earned 8 cents during the period on $1.53 billion in revenue. Analysts surveyed by Refinitiv were expecting the company to earn 3 cents on $1.46 billion in sales. The company also gave strong guidance.

Wynn Resorts — The hotel company’s stock slid more than 2% after Wynn missed earnings estimates for the fourth quarter. Wynn lost $1.37 per share excluding items, which was a wider loss than analysts had been expecting. Revenue, however, topped expectations. The company reported sales of $1.05 billion, compared to the $994 million analysts surveyed by Refinitiv were expecting.

Roblox — Shares of the gaming company dropped more than 12% after Roblox’s fourth-quarter results missed expectations on the top and bottom line. The company lost 25 cents per share during the period and reported sales of $770 million. Wall Street was expecting the company to lose 13 cents per share on $772 million in revenue, according to estimates from Refintiv.

Denny’s — Shares of Denny’s dropped 10% after the company’s fourth-quarter results disappointed Wall Street. Denny’s earned 16 cents per share on $107.6 million in revenue. Analysts surveyed by Refinitiv were expecting the company to earn 17 cents on $111.8 million in revenue.

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Technology

Best Buy could cash in from rise of the metaverse, analyst says

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A near empty parking lot in front of a Best Buy store in Montebello, California on April 15, 2020 as the electronics nationwide chain store remains closed to customers but open for pickups.

Frederic J. Brown | AFP | Getty Images

As companies and consumers grow more interested in the metaverse, Best Buy could cash in by selling more virtual reality headsets and pricier computers, an analyst says.

A research note published Monday by Loop Capital Markets said the consumer electronics retailer is well-positioned to tap into enthusiasm for nonfungible tokens, gaming and socializing in a virtual world. Best Buy is the largest PC retailer in the country, has big-box stores where shoppers can try on different headsets and has a team of tech experts who charge for helping consumers with setup, said Anthony Chukumba, the equity research firm’s managing director.

He reiterated Loop’s buy rating and price target of $150, about 52% higher than where Best Buy is currently trading. Best Buy’s shares are up about 1% as of midday Monday. They have fallen about 9% over the past 12 months.

A growing list of retailers from Nike to Ralph Lauren have dipped their toes into the metaverse. Nike bought virtual sneaker company RTFKT for an undisclosed sum in December. Ralph Lauren has experimented with ways that people can visit or shop at virtual stores on gaming platforms like Roblox and Zepeto.

For Best Buy, the financial opportunity is even simpler, Chukumba said: Consumers may need to upgrade computers to higher-resolution displays and buy extra equipment from monitors to microphones. That could drive a “massive PC upgrade cycle” and one for smartphones, too, he said.

Loop based its views on a conversation with an unnamed CEO and venture capitalist who specializes in NFTs, blockchain, decentralized finance, gaming and the metaverse, Chukumba said. He added, the person has worked in the tech industry since the late 1990s.

With the metaverse, two other merchandise categories — virtual reality and artificial reality devices and videogame consoles— may also gain steam, Chukumba said. Best Buy already has relationships with the major manufacturers that sell those devices, including Meta (formerly known as Facebook and the owner of Oculus), Sony and Apple. Apple is expected to have a VR/AR product coming soon.

Best Buy also has stores where consumers can try on and compare different headsets in person.

Another aspect of the metaverse could help Best Buy, too, Chukumba said. The technology could make it quicker and cheaper to run warehouse simulations that inspire more efficient ways to operate.

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