Paypal Pinterested and Tesla's IBM Problem.
Let's look at the value Pinterest adds to Paypal and why Tesla and IBM shares dropped amidst positive earnings on Wednesday after the market.
Hey, Hisa fan,
It’s been some time! We thought it wise to take a breather. Well, not for a holiday but as a wait on wall street companies which have now jumped into the quarterly release frenzy.
Paypal on Pinterest
Paypal Holdings Inc., the global payment solutions company is set to buy Pinterest Inc. for a whopping $45 billion, the biggest acquisition for a social media company. The move by Paypal which at first seemed odd can be an opportunity for the global payment giant to introduce payment solutions to Pinterest at an age where shoppers have moved to social platforms and e-commerce sites to quench their thirsts for luxury.
Pinterest Inc, which is technically an image sharing and social media service designed to enable saving and discovery of information on the internet using images, and on a smaller scale, animated GIFs and videos, in the form of pinboards.
The news of the possible acquisition saw Pinterest’s shares on a meteoric rise on Wednesday, with trading on the stock halted twice, before closing up more than 12% at $68.68 per share. Paypal’s shares was however lower, with the share price declining by just over 5% to close the day at $258.36 per share.
Why is this important?
Paypal has been on the shopping spree, gulping almost every company it can get to. Just two months ago, the company acquired Paidly and has also gone to acquire Happy returns, Chargehound and Curv since the year began.
Paypal is expanding its territory, Shopify Inc has been on the offensive and has made the e-commerce space, Paypal looks to expand its reach outside the small circle.
Not Linked Within.
Professional networking service LinkedIn is set to cease operations in China later this year. Linkedin which is owned by Microsoft Corporation [NASDAQ: MSFT] will be closing in what Microsoft termed as a “significantly more challenging operating environment and greater compliance requirements in China.”
Linkedin which has over 53 million users in China has been under lots of pressure from Chinese regulators, mostly in regards to censorship, some of which Linkedin gave in to.
News of this withdrawal has continued to hamper Microsoft’s share price, in what was announced on Tuesday. By the close of Wednesday, MSFT was down 0.27% to $307.41 per share.
Earnings Call:
Tesla Inc. [NASDAQ:TLSA]
Electric car manufacturer Tesla Inc released their quarterly financials after the market closed on Wednesday, the first earnings without Elon Musk present since the company was listed over a decade ago. Despite the positive earnings, the company’s stock dropped by 1.5% in after-hours trading.
Tesla posted $1.86 in earnings-per-share from about $13.8 billion in sales for 3Q21.
Vehicle deliveries stood at about 241,000 vehicles, roughly 10,000 to 15,000 above analysts projections.
Gross profit margins were recorded at almost 27% compared with about 24% in the second quarter of 2021.
Automotive gross profit margins hit 30.5% even though the company got less cash from regulatory credits.
Tesla incurred a bitcoin-related impairment of $51 million in 3Q21 from its balance-sheet holdings of the cryptocurrency, which served as a negative impact on profits.
IBM Corporation [NYSE:IBM].
IBM, one of the world’s oldest tech companies also released earnings on Wednesday after market close. IBM’s earnings were lower than most analysts estimates as its legacy IT unit led revenue drags on the company’s earnings.
IBM reported adjusted earnings of $2.52 a share on revenue of $17.6 billion.
Total cloud revenue year-on-year reached $27.8 billion, an incredible 14% from figures posted a year ago.
The company’s earnings per share were at $2.52 per share compared to analysts estimates of $2.50 per share.
Net income declined 33% as the company’s gross margin narrowed to 46.4% from 48% in the previous quarter.
IBM’s management failed to provide investors with any guidance of the 4Q21 earnings, a free-fall to shareholders and investors.
IBM’s shares reacted to the earnings wildly as shares dropped as much as 5% in after-hours trading on the NYSE to $141.70 per share.
What Cowries are we collecting Today?
AT&T Corporation [NYSE: T] - AT&T shares have already jumped 1.5% to $26.25 in premarket trading after the company’s earnings beat analyst estimates by $0.90 and an adjusted quarterly profit of $0.87 cents per share. How long are investors holding on to this and will it have an impact on their peers within the sector?
Southwest Airlines [NYSE: LUV] - Southwest airlines has posted a loss per share of $0.23 as the company announced its quarterly results on Thursday. Despite shares being up on Pre-market trading, we will be watching on how investors will take the earnings, with more information regarding the over 2,000 cancellations the company made about two weeks ago.
WeWork Inc [NYSE: WEWK] - WeWork, the American commercial real estate company that provides flexible shared workspaces for tech startups and services for other enterprises starts trading today after a SPAC merger! We work’s first IPO failed in 2019 and it will be interesting to see how investors take up the company whose valuation has taken a nosedive.
Lots of earnings releases coming through on the earnings calendar, here’s a brief.
How about you, What cowries are you collecting today? Let us know on the Hisa App.
Disclaimer: This report does not constitute any investment recommendations. Investors and the general public are advised to do their own research before making any investment decision.