STOCK MARKET NEWS: Tesla’s investor day, Eli Lilly price cuts, GM layoffs, Salesforce, Box earnings

Box reported a profit compared to a year ago loss. Fourth quarter revenue rose 10% to $256.5 million and net income was $20.53 million compared to $4.3 million loss in the prior year quarter.

Billings for the fourth quarter of fiscal year 2023 were $357.1 million, a 6% increase from billings for the fourth quarter of fiscal year 2022 of $337.9 million, or 9% growth on a constant currency basis.

For fiscal year 2024 the company issued the following guidance:

• Revenue is expected to be in the range of $1.050 billion to $1.060 billion, up 7% year-over-year at the high end of the range, or 10% growth on a constant currency basis.

• GAAP net income per share attributable to common stockholders is expected to be in the range of $0.17 to $0.23.

Okta is higher in extending trading. The identity and access management company topped Wall Street revenue and profit estimates.

Fourth quarter revenue rose 33% year-over-year to $510. The company was expected to report a rise in revenue to $489.37 million from $383.02 million in the same quarter last year.

The net loss narrowed to $153 million from $241 million.

Non-GAAP net earnings per share were 30 cents. Okta was expected to show an increase in its first quarter earnings to 9 cents​ per share according to the mean Refinitiv estimate from thirty four analysts.

For the first quarter of fiscal 2024, the Company expects:

• Total revenue of $509 million to $511 million, representing a growth rate of 23% year-over-year;

• Current RPO of $1.675 billion to $1.685 billion, representing a growth rate of 19% year-over-year;

• Non-GAAP operating income of $18 million to $20 million; and

• Non-GAAP diluted net income per share of $0.11 to $0.12, assuming diluted weighted-average shares outstanding of approximately 178 million and a non-GAAP tax rate of 26%. 

Reuters contributed to this report.

Salesforce logo at its exhibition space, at the Viva Technology conference at the Porte de Versailles exhibition center in Paris, France June 16, 2022. (Reuters/Benoit Tessier)

Salesforce Inc on Wednesday forecast first-quarter revenue above Wall Street estimates as pandemic-induced migration to hybrid-work models boosts demand, sending the cloud-based software provider's shares up 10% after markets.

The company also said it will increase its share repurchase program to $20 billion.

Salesforce's newly launched products as well as the Customer 360 platform and messaging app Slack are helping it to win customers and drive sales in the face of a potential economic slowdown.

To drive down costs, Salesforce in January said it planned to close some offices and cut jobs by 10% after pandemic hiring left it with a bloated workforce. Revenue for the fourth quarter ended Jan. 31 was $8.38 billion, compared with analysts' average expectation of $7.99 billion, according to Refinitiv IBES data.

Salesforce forecast revenue for the first quarter between $8.16 billion and $8.18 billion, compared with analysts' average estimate of $8.06 billion, according to Refinitiv IBES data.

ECONOMY

Manufacturing contracts for third straight month

The Institute for Supply Management (ISM) said that its Manufacturing Purchasing Managers’ Index (PMI) reached of 47.7 last month after reaching 47.4 in January, notching the third straight month of contraction.

U.S. manufacturing contracted for a fourth straight month in February, but there were signs that factory activity was starting to stabilize, with a measure of new orders pulling back from more than a 2-1/2-year low.

The Institute for Supply Management survey on Wednesday also showed prices for raw materials increasing last month, suggesting inflation could remain elevated after monthly consumer and producer prices surged in January.

The ISM's manufacturing PMI was little changed at a reading of 47.7 last month from 47.4 in January. Economists polled by Reuters had forecast the index would rise to 48.0. A PMI reading below 50 indicates contraction in manufacturing, which accounts for 11.3% of the U.S. economy.

Dollar Tree store, Runnemede, N.J., Dec. 17, 2022

Dollar Tree Inc forecast annual profit well below estimates on Wednesday, hurt by elevated freight and investment costs and as consumers rein back spending on discretionary items.

With the U.S. on the verge of recession, rising rental and consumer prices have forced shoppers to rethink their purchases and cut spending on non-essential items ranging from homeware to toys.

MARKETS

Dollar Tree profits from raising prices above $1 level

Retailer Dollar Tree beat Wall Street analysts’ expectations in their fourth quarter and fiscal full-year 2022 earnings report after raising price points in stores.

Dollar Tree is battling elevated shipping charges and labor costs, which is expected to result in a margin decline in the first half of the year.

The company expects 2023 profit between $6.30 and $6.80 per share, below analysts' estimate of $7.78 per share in Refinitiv IBES data.

Dollar Tree's executive chairman Richard Dreiling took on the chief executive role on Jan. 29, nearly a year after the group agreed to revamp its board in a settlement with activist investor Mantle Ridge.

MARKETS

Tesla investor day comes with stock rebounding, CEO Musk tweets Master Plan will be unveiled

Tesla will host the company’s first annual investor day on March 1, at its gigafactory facility in Austin, Texas and unveil its third Master Plan.

Tesla's highly anticipated investor day is here as investors look for an updated strategy that supports a nearly 70% gain in the stock this year.

TECHNOLOGY

TikTok sets default screen time limit for teens

TikTok announced Wednesday that its setting a new default time limit for users under 18 years old amid growing scrutiny over the popular social media app.

TikTok said on Wednesday it is developing a tool that will allow parents to prevent their teens from viewing content containing certain words or hashtags on the short-form video app, as the embattled company looks to shore up its public image.

TikTok, owned by Chinese tech company ByteDance, is facing renewed scrutiny worldwide over its proximity to the Chinese government and protection of user data.

The app, wildly popular among younger users, has been banned from government-owned phones in the United States, Canada and other countries due to security concerns.

Like other social media apps, TikTok has also faced criticism for not doing enough to shield teens from inappropriate content.

Development of the parental control feature is in the early stages and the app will consult with parenting, youth and civil society organizations to design the tool, TikTok said.

Delta Air Lines plane takes off from Hartsfield-Jackson Atlanta International Airport in Atlanta, Ga., Nov. 22, 2022. (AP Photo/Brynn Anderson)

Pilots at Delta Air Lines easily approved a new contract that will raise their pay by more than 30% over four years and likely lead to similar agreements covering union pilots at other major U.S. airlines.

The Air Line Pilots Association said 78% of Delta pilots who voted supported the contract. Delta has about 15,000 pilots.

Smaller airlines face a shortage of pilots as major airlines recruit from their ranks. While the biggest carriers say they have enough pilots, the shortage has given unions leverage to bargain for rich pay increases. The union said the Delta deal will lead to a cumulative $7 billion in pay raises.

The ratification comes after picketing by pilots last summer and about six months after Delta pilots voted to authorize a strike.

Salesforce is seen at its exhibition space, at the Viva Technology conference at the Porte de Versailles exhibition center in Paris, France, June 16, 2022. (Reuters/Benoit Tessier)

Activist investor Elliott Management Corp has nominated a slate of directors to the board of Salesforce Inc, according to a source familiar with the matter.

There was no information on how many director candidates Elliott nominated or who they are.

Salesforce reports earnings later on Wednesday.

Elliott, which unveiled its stake in January, has been holding constructive and intense discussions with the company, sources said.

Elliott declined comment. Salesforce could not be immediately reached for comment.

Salesforce earlier this year added three new directors to its board: investment firm ValueAct Capital's head Mason Morfit, Mastercard finance chief Sachin Mehra, and former chief executive of Carnival Corp Arnold Donald.

The company has a number of activist investors in its stock apart from Elliott. They include Jeff Ubben's Inclusive Capital Partners and Jeff Smith's Starboard Value , who have been pushing for Salesforce to increase growth and margins, buy back more shares, and raised concerns about recent acquisitions.

Eli Lilly's Humalog insulin in New York (AP Photo/Pablo Salinas)

Eli Lilly will cut prices for some older insulins later this year and immediately give more patients access to a cap on costs they pay to fill prescriptions.

The moves announced Wednesday promise critical relief to some people with diabetes who can face annual costs of more than $1,000 for insulin they need in order to live. Lilly’s changes also come as lawmakers and patient advocates pressure drugmakers to do something about soaring prices.

LIFESTYLE

Eli Lilly caps out-of-pocket costs for insulin effective immediately

Eli Lilly announced Wednesday that it will immediately cap out-of-pocket costs for insulin at $35. It is a welcome relief to millions of Americans who depend on insulin to survive.

Lilly said it will cut the list price for its most commonly prescribed insulin, Humalog, and for another insulin, Humulin, by 70% in the fourth quarter, which starts in October.

List prices are what a drugmaker initially sets for a product and what people who have no insurance or plans with high deductibles are sometimes stuck paying.

Tupperware Brands has identified a weakness in its internal accounting controls and has identified misstatements which originated in prior annual and unaudited interim periods, the most significant of which to date relate to the company’s historical accounting for income taxes.

Until Tupperware has completed its final close process, there is the possibility that additional current and prior period misstatements could be identified.

Accordingly, the company’s most current financial results are preliminary and are subject to change.

Tupperware on Wednesday reported a loss of $35.7 million in its fourth quarter. On a per-share basis, the Orlando, Florida-based company said it had a loss of 80 cents. Losses, adjusted for non-recurring costs and to account for discontinued operations, were 24 cents per share.

The direct seller of plastic storage containers and cosmetics posted revenue of $313.7 million in the period.

The Associated Press contributed to this report.

Wendy's Italian mozzarella sandwiches and garlic fries (Photo: Wendy's)

Wendy's Co. on Wednesday reported fourth-quarter earnings of $41.3 million.

On a per-share basis, the Dublin, Ohio-based company said it had net income of 19 cents. Earnings, adjusted for non-recurring costs, came to 22 cents per share.

The results beat Wall Street expectations. The average estimate of 11 analysts surveyed by Zacks Investment Research was for earnings of 20 cents per share.

The hamburger chain posted revenue of $536.5 million in the period, matching Street forecasts.

For the year, the company reported profit of $177.4 million, or 82 cents per share. Revenue was reported as $2.1 billion.Wendy's expects full-year earnings in the range of 95 cents to $1 per share.

Aston Martin Valkyrie car is driven off the production line at the company’s factory in Gaydon, Britain, Mar. 16, 2022. (Reuters/Phil Noble)

Aston Martin, a London-listed luxury carmaker, said it expects profitability to improve this year and to turn free cash flow positive in the second half as it begins deliveries of its next-generation sports cars in the third quarter.

“Aston Martin has been held back by logistics and supply issues, like many of its automotive peers. That’s kept a lid on volumes, but the engines are now firing,” said Sophie Lund-Yates, Lead Equity Analyst at Hargreaves Lansdown.

The company on Wednesday forecast wholesale volumes of about 7,000 units for 2023, slightly below average market expectations of 7,134, but its outlook of for an adjusted core profit margin of about 20% came in ahead of analysts' average view.

“Fourth quarter wholesales have jumped, which shows that underlying demand is still strong. An average selling price well above £150,000 also shows how untouched Aston Martin’s core customer base is from income pressures and tough inflationary conditions,” said Lund-Yates.

Revenue at the Gaydon-based group grew 26% to 1.38 billion pounds ($1.67 billion) last year, chiefly because of higher prices. Its core average selling price in 2022 rose 18% to 177,000 pounds.

The British company reported a bigger adjusted operating loss of 118 million pounds for the year ended Dec. 31, compared with a loss of 74.3 million pounds for the same period a year earlier, because of supply chain snarls that delayed deliveries of its cars.

Reuters contributed to this report.

Syringes with needles are seen in front of a displayed Novavax logo in this illustration taken, Nov. 27, 2021. (Reuters/Dado Ruvic/Illustration)

Novavax Inc's shares plunged more than 26% in U.S. premarket trading on Wednesday, a day after the COVID-19 vaccine maker raised doubts about its ability to remain in business.

The company—whose COVID vaccine is its only marketed product after 35 years in business—on Tuesday flagged significant uncertainty around its 2023 revenue, funding from the U.S. government, and pending arbitration with global vaccine alliance Gavi.

Novavax's shot, a traditional protein-based vaccine, was pitched as an alternative to those from Moderna and Pfizer-BioNTech in the hope it would win over skeptics of their newer mRNA technology, but manufacturing and regulatory delays led to sluggish uptake in key markets.

In the U.S., where the vaccine was authorized in July 2022, only around 80,000 of its shots have been administered, according to government data.

In Europe, the shot was initially given the green light in December 2021. Altogether, only 219,395 doses have been administered of nearly 13 million distributed in EU/EEA countries, according to data from the European Centre for Disease Control up to Feb. 23.

Jefferies' analysts said they were lowering Novavax's peak COVID-19 market share to 15% from 25%, and cut their price target on the U.S. stock to $68 from $90. B Riley Securities' analysts also slashed their price target to $10 from $29.

Closed signs are seen on an AMC Theatre during the outbreak of the coronavirus disease (COVID-19), in New York City, U.S., April 29, 2020. (Reuters/Brendan McDermid)

AMC Entertainment Holdings Inc's shares fell 8% in premarket trading after the company's results underscored fears that theater-going would not return to pre-pandemic levels anytime soon as rising cost-of-living bites.

The world's largest cinema chain operator saw a 17% fall in footfall in its theaters in the fourth quarter, despite the release of big-ticket films such as "Avatar: The Way of Water". Revenue fell 15.4% in the quarter.

In the United States and Canada, box office collection was above $11 billion in 2019, but since the COVID-19 pandemic, the numbers have fallen drastically, with 2022 box office numbers coming in at $7.4 billion, the company said.

"It will take years to see box office revenues return to 2019 levels, which they may not ever do at all," said Jamie Lumley, analyst at Third Bridge.

Wedbush Securities analysts expect 2023 box office to be down 24% from 2019 levels. AMC, however, said it expects box office will not return to pre-pandemic norms before 2024 or 2025 at the earliest.

Streaming became the preferred way to watch movies since the pandemic, Lund-Yates said, adding that the cost-of-living pressures were weighing on theater operators.

Still, AMC said it would pay down its debt of about $4.95 billion as it continued to raise cash. It raised about $314 million in gross cash proceeds over the last 12 months.

Puma logo seen at the entrance of one of its stores in Vienna, Austria, Mar. 18, 2016. (Reuters/Leonhard Foeger)

German sportswear maker Puma on Wednesday highlighted the pressures on its profit margins for the current year from higher costs and currency effects despite an expected recovery in China. Rising materials and freight costs along with a stronger U.S. dollar, inventory markdowns and higher promotion expenses have hit margins in the sporting goods sector, which is now betting on recovery in China to alleviate the margin pressures.

Puma expects Greater China to return to growth in 2023, newly appointed Chief Executive Arne Freundt said at a news conference, adding its market share in the country was "significantly too low", especially compared with rivals Adidas and Nike.

Puma's results on Wednesday showed that full-year currency-adjusted sales in Greater China dropped 36% year-on-year.

The company forecast annual operating profit (EBIT) for 2023 in a range of 590 million to 670 million euros ($626 million to $711 million), with currency-adjusted sales expected to grow in a high-single-digit percentage rate.

The guidance midpoint of 630 million euros compares with EBIT of 641 million euros Puma reported for 2022.

($1 = 0.9425 euros)

Lowe's store, Voorhees, N.J., Nov. 12, 2022

Lowe's Cos Inc forecast full-year sales below market expectations on Wednesday, hammered by weak demand for home improvement products as customers save up cash for higher-priced everyday essentials.

A pandemic-fueled boom in demand for products such as kitchen equipment and gardening tools is now fading as household budgets shrink, while Americans redirect their attention back to activities such as traveling.

A report from location analytics firm Placer.ai said visits to Lowe's stores dropped in the fourth quarter, also because spending on services exceed goods following the easing of pandemic-led curbs.

The company projected full-year total sales of $88 billion to $90 billion, while analysts estimated annual revenue of $90.48 billion, according to Refinitiv data.

Lowe's also forecast 2023 earnings in the range of $13.60 to $14.00 per share, the midpoint of which was slightly ahead of an estimate of $13.79.

Lowe's reported a 1.5% decline in comparable sales for the three months ended Feb. 3, worse than expectations of a 0.01% drop.

Kohl's store, Voorhees, N.J., Nov. 19, 2022

Kohl's Corp reported a surprise quarterly loss and forecast full-year profit well below analysts' estimates on Wednesday, as steep discounts to boost sluggish demand for apparel shredded the retailer's margins.

Surging costs of rent and food over the last year have forced customers to cut back on spending on non-essential products, pushing Kohl's and other retailers into steeper discounts and promotions to clear excess stocks of casual apparel.

Those discounts were the major contributor to a more than 10 percentage point decline in fourth-quarter gross margins to 23%, Kohl's said.

The company is especially hard hit as the lower-income customers it typically caters to are among the worst hit from surging prices.

Kohl's reported a loss of $2.49 per share for the fourth quarter ended Jan. 28, compared with estimates for a profit of 98 cents.

The company expects fiscal 2023 earnings per share of $2.10 to $2.70, compared with analysts' estimates of $3.20, according to Refinitiv IBES data.

Comparable sales at Kohl's fell 6.6% in the fourth quarter, compared with analysts' estimate of a 3.7% decrease.

MARKETS

Rivian shares fall on mixed results, new recall

Electric automaker Rivian reported mixed results along with its second recall in less than six months. The recall involves nearly 89% of the vehicles produced through September.

Electric vehicle maker Rivian disappoints investors after earnings fall short and another recall is announced.