Past week was marked by major earnings reports, economic indicators, and notable market events. Key takeaways include strong results from Tesla, strategic shifts from Starbucks, and capital allocation changes from Verizon. Additionally, geopolitical and corporate conflicts reemerged, impacting market sentiment and stock performances.
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Major Earnings Reports:
Below are the major earnings report of past week.
1. Tesla (TSLA)
Tesla delivered impressive financial results, with revenue reaching $25.2 billion (+8% YoY), and operating income of $2.7 billion (+54% YoY). Profits hit $2.2 billion, reflecting a +17% increase.
Investors rewarded Tesla’s strategic advancements with a +27% jump in the stock, adding $150 billion to its market cap. Analysts cited the company’s margin improvements and its delivery growth forecast of +20-30% for 2025, significantly above expectations.
2. Starbucks (SBUX)
Starbucks faced a sales slowdown with revenue at $9.1 billion, compared to $9.4 billion last year, and earnings per share dipping to $0.80 from $1.06.
Wall Street displayed mixed sentiments. Some analysts were optimistic due to Brian Niccol’s proven track record, while others showed caution due to the lack of forward guidance. The stock’s performance remains under close scrutiny as Starbucks executes its turnaround strategy.
Verizon (VZ)
Verizon reported flat revenue of $33.3 billion YoY and a decline in operating income to $5.9 billion. Profits fell to $3.4 billion from $4.9 billion last year.
The stock traded lower post-earnings as Wall Street revised down its free cash flow expectations for the upcoming years. Analysts remain cautious, focusing on Verizon’s capital-intensive outlook.
Notable News and Events
Below are the notable news and events happened in the last week.
1. Spirit Airlines Extends Lifeline:
Spirit Airlines managed to extend its debt deadline, providing a temporary lifeline. The company also initiated cost-cutting measures, including job cuts and the sale of 23 older planes, which is expected to generate $519 million.
Shares surged +16% as investors welcomed the refinancing extension and cost reduction plans. However, the airline continues to navigate industry challenges and market pressures.
2. McDonald’s Onion Controversy
McDonald’s faced a health crisis after an E. coli outbreak linked to onions in its Quarter Pounders led to 49 cases and one fatality. As a result, the company temporarily removed onions from several U.S. locations.
The stock fell -7% amid concerns about the brand’s reputation and potential impact on sales. The company is cooperating with health authorities and plans to provide more updates in its Q3 earnings report.
3. Jobless Claims Surge
Continuing jobless claims climbed to nearly 1.9 million, marking the highest level in almost three years. The increase was partially due to recent hurricanes and supply chain disruptions linked to the Boeing strike. Analysts are closely monitoring the labor market for further impacts.
Conclusion:
This week was a mixed bag for markets, with corporate earnings highlighting strategic shifts, economic indicators providing both optimism and caution, and notable events reshaping industry dynamics. Investors will continue to weigh these developments as they prepare for the next set of market-moving announcements.
Muzzammil is a content writer at Stock Target Advisor. He has been writing stock news and analysis at Stock Target Advisor since 2023 and has worked in the financial domain in various roles since 2020. He has previously worked on an equity research firm that analyzed companies listed on the stock markets in the U.S. and Canada and performed fundamental and qualitative analyses of management strength, business strategy, and product/services forecast as indicated by major brokers covering the stock.
