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Daily Market Report | February 3, 2022

US FINANCIAL MARKET

Stocks Fall as Disappointing Meta Profit Weighs on Tech – Wall Street Journal, 2/3/2022

  • Major U.S. stock indexes tumbled on Thursday, dragged down by technology and social-media companies, as investors hammered shares of Facebook owner Meta Platforms after a disappointing earnings report.
  • The tech-focused Nasdaq Composite Index slid 1.6% in morning trading.
  • The broader S&P 500 fell 1.1%, while the Dow Jones Industrial Average declined 0.7%.
  • Meta’s stock price plunged 23% after the social-media giant startled investors with a sharper-than-expected decline in profit and a gloomy outlook. Other social-media companies sold off in its wake.
  • Snap and Pinterest, which are due to report earnings later Thursday, slid 18% and 4.8%, respectively. Twitter fell 3.8%.
  • Several other tech stocks also slumped. Spotify Technology fell 16% after the company declined to issue annual guidance, spooking investors.
  • Amazon.com —which is also scheduled to report earnings later Thursday—dropped 6%.
  • Earlier, PayPal slumped 25% on Wednesday after the payments company lowered its profit outlook.
  • One bright spot on Thursday was T-Mobile US, whose shares jumped 9.4% after the telecommunications company topped analysts’ profit forecasts.
  • On the economic front, initial claims for jobless benefits fell to 238,000 in the week through Jan. 29. Claims hit a record low in early December as businesses held on to more workers amid a persistent labor shortage.
  • The Bank of England pressed ahead with raising borrowing costs Thursday, nudging up its policy rate to 0.5% from 0.25%.
  • The pound strengthened 0.2% to $1.3604. Yields on 10-year U.K. government bonds rose following the bank’s decision, as did yields on equivalent U.S. debt. The yield on benchmark Treasury notes climbed to 1.834% from 1.765% Wednesday.
  • The European Central Bank (ECB) held its key interest rates steady and said it would keep them there until inflation was durably at its target.
  • Overseas stock markets were broadly lower. The Stoxx Europe 600 slid 1.5%, led by losses for industrial goods and tech shares. In Asia, Japan’s Nikkei 225 fell 1.1%. Chinese markets were closed for a public holiday.

Meta Faces Historic Stock Rout After Facebook Growth Stalled – Bloomberg, 2/3/2022

  • Meta Platforms’ stock collapsed as much as 26% on Thursday morning, its biggest drop ever, after Facebook’s user base faltered last quarter, the first stagnation in the company’s history. It was just one bad metric of several in a dire earnings report that caused many investors to wonder if the stock’s best days are behind it.
  • Revenue was $33.67 billion, compared with the $33.43 billion average estimate.
  • Facebook reported 2.91 billion monthly users in the fourth quarter, flat compared with the prior period.
  • The main app’s daily active users in North America — the company’s most lucrative market — declined slightly from 196 million to 195 million users.
  • Meta’s Reality Labs division, which includes the company’s investments in the metaverse and virtual reality, reported an operating loss of $3.3 billion for the fourth quarter, as the company disclosed its contribution for the first time.
  • Net income in the fourth quarter was $10.3 billion, or $3.67 a share, Meta said, falling short of the $3.84 per share analysts projected.
  • Aside from user growth woes and intensifying competition, Meta is also contending with a crackdown on targeted advertising by Apple, which it said may trim $10 billion in revenue this year, and cutbacks by advertisers that are paring budgets because of rising costs and supply chain disruptions.
  • Meta said revenue in the current period will be $27 billion to $29 billion, compared with the $30.3 billion analysts estimated on average. Changes to Apple’s mobile software that require user permission to gather data for ad tracking are significantly crimping revenue by limited targeted advertising, Meta said.

T-Mobile Soars After Carrier’s Upbeat 2022 Customer Outlook – Bloomberg, 2/3/2022

  • T-Mobile soared as much as 9.5% in extended trading after the company, the No. 2 U.S. wireless carrier, projected 2022 subscriber growth that exceeded most analysts’ expectations.
  • Revenue edged up to $20.8 billion, missing estimates.
  • T-Mobile also reported fourth-quarter profit that beat analysts’ estimates.
  • Earnings came to 34 cents a share, the Bellevue, Washington-based wireless provider said, exceeding estimates of 12 cents.
  • As part of its fourth-quarter report, T-Mobile said Wednesday it expects to add 5 million to 5.5 million new subscribers this year.
  • Analysts had forecast 5 million, according to the average of analysts surveyed by Bloomberg.
  • The integration of Sprint, acquired in 2020, has led to overhead cost savings that the company estimates will range as high as $2.35 billion this year, according to the earnings report.

Qualcomm Posts Strong Earnings, as Demand for Chips Stays High – Wall Street Journal, 2/3/2022

  • Qualcomm posted strong quarterly earnings and gave an upbeat sales outlook, underscoring that demand for chips for everything from smartphones to cars remains elevated.
  • The company on Wednesday said it generated $10.7 billion in sales and $3.4 billion in net income in the most-recent quarter, surpassing Wall Street expectations.
  • Handsets, though, remain core to Qualcomm’s results. Sales in that segment advanced 42% in the most recent quarter from the year-ago period amid strong demand for 5G devices.
  • Qualcomm, which projects revenue of up to $11 billion for the current quarter, joins other chip companies to report strong results over the past 10 days, as semiconductor demand outpaces supply.

Spotify, Facing Pushback Against Joe Rogan, Reports Jump in Users – Wall Street Journal, 2/3/2022

  • Spotify Technology added more users and saw a surge in advertising revenue in its recently completed quarter as its podcast strategy takes hold despite backlash to its star host.
  • Neil Young last week removed his music from Spotify in protest to what he says is vaccine misinformation spread by podcaster Joe Rogan on the streaming service.
  • On Spotify’s earnings call Wednesday, Chief Executive Daniel Ek called it a very complicated issue and said Mr. Rogan, like other creators on the company’s platform, has to abide by its content policies.
  • In all for the quarter ended Dec. 31, Spotify’s revenue rose 24% to €2.69 billion, above the company’s expectations.
  • For the fourth quarter, Spotify reported 406 million monthly active users, up 18% from a year earlier and at the high end of the company’s guidance.
  • Paying subscribers, its most lucrative type of customer, rose 16% to 180 million, also at the top of the company’s expectations.
  • Average revenue per user for the subscription business in the recently completed quarter climbed 3% to €4.40.
  • Revenue from subscriptions climbed 22% to €2.295 billion, equivalent to roughly $2.6 billion.
  • Advertising revenue shot up 40% to €394 million.
  • Spotify said it has 3.6 million podcasts available on its service, up from 3.2 million in the previous quarter.
  • Spotify reported a narrower loss of €39 million from a loss of €125 million a year earlier.
  • For the current first quarter, the company said it expects monthly active users of 418 million, premium subscribers of 183 million and revenue of €2.6 billion.
  • Analysts, on average, were expecting 418.2 million monthly active users, 184 million premium subscribers and €2.6 billion in revenue, according to FactSet.
  • Spotify shares—down 44% over the past year to $191.92—fell another 11% in after-hours trading as the company said it wouldn’t provide annual guidance.

Hershey’s Quarterly Profit Rose, Helped by Price Increases – Wall Street Journal, 2/3/2022

  • Candy company Hershey said its sales and profit rose in the holiday quarter, as higher prices helped offset a jump in costs.
  • The company posted sales of $2.33 billion for the quarter, up from $2.19 billion a year ago.
  • Analysts surveyed by FactSet were looking for sales of $2.27 billion.
  • For the fourth quarter, Hershey posted net income attributable to the company of $335.6 million, compared with $291.4 million a year earlier. Earnings were $1.62 a share, up from $1.39 a year earlier.
  • In the year ahead, the company said it plans to invest between $550 million and $600 million, including in expanding the agility and capacity of the company’s supply chain.
  • The company also forecast full-year 2022 sales growth of between 8% and 10%.
  • The company expected full-year adjusted earnings to come in between 9% and 11% higher.

Carlyle’s Fourth-Quarter Earnings Jump – Wall Street Journal, 2/3/2022

  • Carlyle Group reported a big jump in fourth-quarter earnings, driven by strong investment performance in some of its businesses and an upswing in fee-related revenue.
  • Fee-related earnings climbed 20% to $174.5 million as fee-earning assets under management increased by 14% to $193 billion. Overall assets under management rose to $301 billion, up 22% year over year.
  • The Washington, D.C.-based firm reported net income of $647.6 million, or $1.77 a share, in the period. That compares with net income of $518.8 million, or $1.44 a share, a year earlier.
  • Carlyle’s fourth-quarter distributable earnings, or the portion of profit that could be returned to shareholders, came in at a record $902.8 million, or $2.01 a share. That compares with $236.9 million, or 64 cents a share, a year earlier.
  • The firm said its board approved an increase in the annual dividend to $1.30 per share, up from $1.

Honeywell’s revenue misses estimates on supply woes, lower mask demand – Reuters, 2/3/2022

  • Honeywell International reported lower-than-expected quarterly sales on Thursday, hit by supply chain challenges at its aerospace segment and a fall in demand for masks.
  • Total sales for the fourth quarter slid 2% to $8.66 billion, compared with analysts’ expectations of $8.73 billion, according to Refinitiv data.
  • The company, whose shares fell 2.7% before the bell, reported a decline in sales in three out of its four segments, with its Safety and Productivity Solutions unit — that makes masks — seeing a 10% slide in the fourth quarter.
  • Price increases to combat inflation helped Honeywell post a rise in profit.
  • Its net income rose 5% to $1.43 billion, or $2.05 per share, in the quarter ended Dec. 31, from $1.36 billion or $1.91 per share a year earlier.
  • The company forecast 2022 sales of $35.4 billion to $36.4 billion, lower than analyst estimate of $36.76 billion.

Merck sees 2022 sales up nearly 20%, mostly on new COVID pill – Reuters, 2/3/2022

  • Merck said on Wednesday it expects its 2022 sales to increase as much as 18 percent over last year, mostly on sales of its new COVID-19 pill, molnupiravir.
  • Merck reported fourth-quarter sales of $13.52 billion, up from $10.95 billion a year ago, driven by molnupiravir sales and growth of blockbuster cancer drug Keytruda and human papillomavirus (HPV) vaccine Gardasil. Analysts had expected sales of around $13.2 billion in the quarter.
  • The drugmaker said sales of the COVID-19 drug were $952 million in the fourth quarter, and it expects another $5 billion to $6 billion in molnupiravir sales in 2022.
  • Merck expects 2022 revenue to be between $56.1 billion and $57.6 billion, up from $48.7 billion last year.

Biogen 2022 forecast below Street view on Alzheimer’s drug uncertainty – Reuters, 2/3/2022

  • Biogen on Thursday forecast 2022 profit well below Wall Street estimates as sales of its new Alzheimer’s disease drug stall amid questions over its efficacy and a looming U.S. government coverage decision that could severely limit its future use and force further cost cutting.
  • Aduhelm brought in $1 million in sales in the fourth quarter, compared to already diminished estimates of $2.8 million.
  • In the fourth quarter, Biogen earned $3.39 per share, edging past analysts’ estimates by a cent.
  • Biogen on Thursday forecast full-year adjusted profit of $14.25 to $16.00 per share, well short of analysts’ estimates of $18.82 per share, according to Refinitiv IBES.
  • The U.S. Centers for Medicaid and Medicare Services (CMS) in January proposed to restrict coverage for Alzheimer’s drugs, including Biogen’s Aduhelm, only to patients taking part in approved clinical trials. A final decision is expected in April.
  • The company warned that it could be forced to cut more costs, beyond the current program to save $500 million annually, if the final coverage decision is not broader than the proposal.

Eli Lilly results beat on diabetes drug, COVID antibody therapies – Reuters, 2/3/2022

  • Eli Lilly reported quarterly results on Thursday that beat analysts’ estimates due to strong demand for its top-selling diabetes drug Trulicity as well as higher sales of its COVID-19 antibody therapies.
  • The company’s revenue from COVID-19 antibody therapies rose 22% to $1.06 billion, compared with estimates of $648 million, according to Refinitiv IBES data.
  • Trulicity sales jumped 25% to $1.88 billion, helping the company post quarterly revenue of $8 billion, beating estimates of $7.73 billion.
  • The surge in COVID-19 cases also led to a 59% jump in sales of its rheumatoid arthritis drug Olumiant, which is also used to treat patients hospitalized due to the coronavirus, Lilly said.
  • On an adjusted basis, Lilly reported a quarterly profit of $2.49 per share, compared with estimates of $2.46 per share.
  • The company also reaffirmed its full-year adjusted earnings outlook between $8.50 and $8.65 per share.

Estee Lauder boosts annual projections on recovering cosmetics demand – Reuters, 2/3/2022

  • Estee Lauder bumped up its annual revenue and profit projections on Thursday as consumers returning to in-person events splurged on its foundations and MAC lipsticks.
  • Sales of the cosmetics maker rose in every region in the last three months of 2021, powering second-quarter earnings above Wall Street expectations.
  • The La Mer beauty products maker expects reported net sales to rise between 13% and 16% for the full year, compared with its previous forecast of a 12% to 15% increase.
  • It sees adjusted annual profit of between $7.43 and $7.58 per share, up from $7.23 to $7.38 per share previously.
  • It forecast current-quarter adjusted profit between $1.55 and $1.65 per share, below expectations of $1.92, according to Refinitiv IBES data.

Ralph Lauren rides luxury boom as high-end apparel sales soar – Reuters, 2/3/2022

  • Ralph Lauren raised its annual revenue forecast on Thursday and became the latest luxury goods retailer to top market estimates for holiday-quarter revenue as demand for high-end apparel soars.
  • Ralph Lauren’s net revenue rose 27% to $1.82 billion in the third quarter ended Dec. 25.
  • Analysts on average had expected revenue of $1.64 billion, according to Refinitiv IBES data.
  • Revenue rose 30% in North America and 47% in Europe.
  • Excluding certain items, Ralph Lauren reported a profit of $2.94 per share, beating estimates of $2.17.
  • Ralph Lauren said it expects current-quarter revenue to rise by about 17% to 18% on constant currency basis, helped by higher prices, which the company said will also offset higher freight and raw material costs.
  • The company said it expects constant currency revenue for fiscal year 2022 to rise 39% to 41%, compared with a 34% to 36% increase it forecast earlier.

Capri plans price increases at Michael Kors, Versace as luxury fashion booms – Reuters, 2/3/2022

  • Michael Kors owner Capri on Wednesday reported a 24% jump in holiday-quarter sales and raised its full-year outlook, saying it would further increase prices across its brands to take advantage of soaring demand for high fashion.
  • The company’s total revenue rose to $1.61 billion in the third quarter ended Dec. 25, ticking back up above pre-pandemic levels.
  • The company forecasts fiscal 2022 revenue of $5.56 billion, compared with its prior estimate of $5.4 billion, while it expects annual profit per share to be $6, up from $5.30 per share.
  • Capri also projected fiscal 2023 revenue of about $6.1 billion, above analysts estimates of $5.97 billion.

U.S. Moving—Some Say Too Slowly—to Address TikTok Security Risk – Wall Street Journal, 2/3/2022

  • The Biden administration is moving to revise federal rules to address potential security risks from TikTok and other foreign-owned apps, eight months after opting not to pursue a forced shutdown of the Chinese-owned video-sharing platform.
  • The Commerce Department recently concluded a public-comment period on the proposed rule change, which would expand federal oversight to explicitly include apps that could be used by “foreign adversaries to steal or otherwise obtain data,” according to a filing in the Federal Register.
  • Under the rule, the commerce secretary could effectively bar foreign apps deemed unacceptable security risks. That could force social-media platforms such as TikTok and other software applications connected to the internet to submit to third-party auditing, source-code examination and monitoring of the logs that show user data, according to the proposed rule.
  • The U.S. military has already banned its members from using the app on government-issued devices. Some lawmakers including Sen. Marco Rubio (R., Fla.) say the White House is moving too slowly to come up with a comprehensive plan.

US ECONOMY & POLITICS

U.S. Services Growth Cools to Almost One-Year Low on Omicron – Bloomberg, 2/3/2022

  • Growth in the U.S. services sector pulled back in January to the slowest pace in nearly a year as a surge in Covid-19 cases and lingering supply constraints weighed on business activity.
  • The Institute for Supply Management’s gauge of services activity fell to 59.9, the lowest since February of last year, from 62.3 a month earlier, according to data released Thursday.
  • The moderation in growth last month followed a 6.1-point plunge that was the sharpest since April 2020, indicating the omicron variant of the coronavirus continued to discourage spending on in-person services like travel and dining out.
  • The ISM’s index of orders and its measure of business activity, which parallels the group’s gauge of factory production, also dropped to 11-month lows.
  • In November, those measures as well as the overall services index, were at or near the strongest in data back to 1997.
  • The latest report also indicated persistent supply-chain challenges, likely exacerbated by the recent wave of infections. The group’s index of supplier delivery times edged up to 65.7, signaling extended delays in procuring materials.
  • The effects of omicron were also evident in the ISM’s measure of export orders, which plunged in January by a record 15.6 points. The measure of bookings for overseas customers dropped to 45.9, the lowest level since May 2020.
  • The ISM’s index of services employment eased as well, falling to a seven-month low of 52.3 from 54.7.
  • The services report also illustrated inflationary pressures continue to linger. The ISM measure of prices paid by service providers eased to 82.3 from a record-high of 83.9 in December.

U.S. Jobless Claims Fall for Second Straight Week – Wall Street Journal, 2/3/2022

  • Initial filings for unemployment benefits fell for the second week in a row at the end of January, a sign the labor market is bouncing back from the temporary disruption caused by the Omicron variant of Covid-19.
  • The number of first-time claims decreased to a seasonally adjusted 238,000 in the week ended Jan. 29 from 261,000 the prior week, the Labor Department said Thursday.
  • Claims had risen to 290,000 in the week ended Jan. 15 as the latest Omicron wave caused case counts to spike and millions of people called in sick.
  • The four-week moving average of new jobless claims rose slightly last week to 255,000, the Labor Department said in Thursday’s report.
  • Overall, roughly 1.62 million people were collecting unemployment benefits in the week ended Jan. 22, down 44,000 from the prior week, the department said.

U.S. factory orders fall in December; shipments rise further – Reuters, 2/3/2022

  • New orders for U.S.-made goods fell slightly more than expected in December, but manufacturing remains supported by businesses replenishing inventories.
  • The Commerce Department said on Thursday that factory orders decreased 0.4% in December.
  • Data for November was revised higher to show orders increasing 1.8% instead of 1.6% as previously reported.
  • Economists polled by Reuters had forecast factory orders slipping 0.2%. Orders increased 16.9% in 2021.
  • Shipments of manufactured goods rose 0.4% in December after increasing 0.7% in November.
  • Inventories at factories climbed 0.3%. Unfilled orders rose 0.5% after gaining 0.8% in the prior month.
  • The Commerce Department also reported that orders for non-defense capital goods, excluding aircraft, which are seen as a measure of business spending plans on equipment, rose 0.3% in December instead of being unchanged as reported last month.

U.S. Orders 3,000 Troops to Bolster European Allies in Russia-Ukraine Crisis – Wall Street Journal, 2/3/2022

  • President Biden is directing the Pentagon to deploy more than 3,000 American troops to bolster the defense of European allies in the first major movement of U.S. forces in Russia’s military standoff with Ukraine, U.S. officials said.
  • Mr. Biden is sending roughly 2,000 troops from Fort Bragg, N.C., to Poland and Germany this week and repositioning about 1,000 troops that are part of a Germany-based infantry Stryker squadron to Romania, on the North Atlantic Treaty Organization’s eastern flank closest to Russia, the officials said.
  • In addition, the Pentagon expects to make other moves of forces inside Europe, and has ordered several thousand more troops to be on standby to deploy, beyond the 8,500 troops given similar orders last week, the officials said.
  • Russia on Thursday denounced the U.S. troop deployment to Eastern Europe. Kremlin spokesman Dmitry Peskov told reporters that Moscow was concerned by the decision and would take appropriate measures to protect Russia’s national security.

ISIS Leader Killed During U.S. Raid in Syria, Biden Says – Wall Street Journal, 2/3/2022

  • The Islamic State’s leader died during a U.S. military raid in northwestern Syria when he detonated explosives that killed him and several family members as U.S. forces approached, President Biden said.
  • Mr. Biden said he ordered the raid that killed Abu Ibrahim al-Hashimi al-Qurayshi, directing the Defense Department to minimize civilian casualties.
  • “Thanks to the skill and bravery of our Armed Forces, we have taken off the battlefield Abu Ibrahim al-Hashimi al-Qurayshi—the leader of ISIS. All Americans have returned safely from the operation,” Mr. Biden said in a statement.

EUROPE & WORLD

Bank of England Enacts First Back-to-Back Rate Rises Since 2004 – Wall Street Journal, 2/3/2022

  • The Bank of England raised its key interest rate for a second consecutive meeting, moving further ahead of other major central banks as they grapple with soaring inflation.
  • The rate-setting Monetary Policy Committee agreed to lift the BOE’s policy rate to 0.5% from 0.25%, saying they expect annual inflation to accelerate above 7% within months due to low unemployment, rising wages and surging energy prices.
  • Four of the panel’s nine members wanted a bigger rise, to 0.75%, citing widening and more persistent price pressures than expected.
  • The majority, including Gov. Andrew Bailey, voted for a quarter-point increase, saying that should be enough to bring inflation back to their 2% target in the next two to three years.
  • The BOE also said it would begin slowly reducing the size of its bond-buying program by no longer reinvesting the cash it receives from maturing bonds in its portfolio, the first time a major central bank has embarked on a sustained effort to shrink its balance sheet since the Federal Reserve attempted it in 2017.

ECB Keeps Rates Unchanged, Diverging From Other Major Central Banks – Wall Street Journal, 2/3/2022

  • The European Central Bank kept its key interest rates on hold and said it would continue buying eurozone debt on a large scale through much of the year, diverging from other major central banks like the Federal Reserve that are moving quickly to phase out easy money amid a surge in inflation.
  • Annual inflation in the eurozone rose to a record of 5.1% in January, more than double the ECB’s target, increasing the pressure on the central bank to ditch its plans to keep rates on hold throughout the year.
  • The ECB said in a statement it would keep its key interest rate on hold at minus 0.5% and continue to buy tens of billions of euros of eurozone bonds a month at least through October.
  • The ECB is increasingly becoming an outlier among global central banks as both advanced and emerging economies start to increase borrowing costs or signal they will do so soon.
  • In the eurozone, inflation is still somewhat lower than in the U.S. and the U.K., but its steady rise has likely surprised the ECB.
  • The eurozone’s annual inflation rate of 5.1% in January compares with 5.4% in the U.K. and 7% in the U.S. in December.

Egypt Holds Interest Rate While Accelerated Fed Tightening Looms – Bloomberg, 2/3/2022

  • Egypt left one of the world’s top inflation-adjusted interest rates unchanged, even as the U.S. Federal Reserve began the countdown to an expected burst of monetary tightening.
  • The central bank held the benchmark deposit rate at 8.25% and the lending rate at 9.25%, the Monetary Policy Committee said Thursday in a statement. All 9 economists surveyed by Bloomberg predicted what’s Egypt’s 10th consecutive hold, even as expectations build for the first hike since 2017 later this year.
  • The North African nation has become a favorite with overseas portfolio investors by offering the highest differential between key policy rates and inflation among more than 50 economies tracked by Bloomberg.
  • Foreign investors pumped billions of dollars into the country’s debt market, giving a buffer while the pandemic hit other sources of foreign currency, such as tourism.
  • Despite an uptick in local inflation expected in coming months, analysts expect the rate will remain within the central bank’s target range of 5%-9%. Consumer prices climbed in December to 5.9% from 5.6% the month before.

Sony lifts forecast as ‘Spider-Man’ propels quarterly profit – Reuters, 2/3/2022

  • Japan’s Sony raised its full-year profit forecast by 15% on Wednesday after posting estimate-smashing quarterly earnings, propelled by the success of “Spider-Man: No Way Home” which has become the sixth-highest grossing movie.
  • Operating profit at its pictures business jumped by more than seven-fold to 149.4 billion yen ($1.30 billion) in its fiscal third quarter ended December as the unit’s revenue more than doubled.
  • It now expects the business to post a profit of 205 billion yen in the current fiscal year as the super-hero movie, released in December, grossed more than $1.7 billion worldwide despite the spread of the Omicron coronavirus variant.
  • The company’s main gaming segment, focused on PlayStation, also posted a rise in profit, with sales of 3.9 million PS5 units in the third quarter, but hardware supply was hampered by component shortages.
  • Sony cut its full-year PS5 sales forecast to 11.5 million units from 14.8 million units previously in response.
  • Overall quarterly operating profit at Sony – a conglomerate spanning areas such as entertainment, sensors and financial services – was 465.2 billion yen, compared with an estimated average profit of 351.6 billion yen from nine analysts surveyed by Refinitiv.
  • Sony, which switched to IFRS accounting standards from U.S. GAAP in the current financial year, increased its full-year profit forecast to 1.2 trillion yen from 1.04 trillion yen. That prediction is higher than an average 1.09 trillion yen profit forecast from 24 analysts, Refinitiv data showed.

Nokia resumes dividend, share buybacks as turnaround gathers pace – Reuters, 2/3/2022

  • Nokia on Thursday restarted its quarterly dividend and initiated a share buyback program after reporting fourth-quarter comparable operating earnings above markets estimates as the Finnish telecoms equipment maker kept costs in check.
  • For 2021, the company reported revenue of 22.2 billion – a growth of 3% in constant currency.
  • Nokia’s fourth-quarter adjusted operating profit of 908 million euros beat the 822 million euros expected by analysts.
  • Nokia predicted its 2022 revenue will amount to between 22.6 billion euros and 23.8 billion euros ($25.5 billion-$26.9 billion), up from 22.2 billion last year. Analysts on average expected revenue of 23.06 billion, a Refinitiv poll showed.
  • The company also forecast annual revenue largely ahead of projections and set a long-term target for operating margins of at least 14%, replacing its earlier 2023 target of between 11% and 13%.
  • Nokia also proposed a dividend, suspended since 2019, of 8 euro cents per share for 2021, and start a share buyback scheme of 600 million euros.

Panasonic’s Q3 profit slides as material costs rise and appliance sales fall – Reuters, 2/3/2022

  • Japan’s Panasonic on Wednesday posted a larger-than-expected 44% slide in third-quarter operating profit, hit hard by rising costs for raw materials, component shortages and a drop in domestic sales for appliances.
  • Operating profit for the three months to Dec. 31 dropped to 73 billion yen ($636 million), far short of a Refinitiv consensus estimate of 107 billion yen.
  • The industrial conglomerate said the profit margin at the division which houses its consumer and home appliances businesses was squeezed by rises in the cost of iron, copper and other materials.
  • Panasonic stuck with its full-year forecast for annual profit of 370 billion yen – a figure in line with analysts’ forecasts.

Factmonster – TODAY in HISTORY

  • Johann Gutenberg, German printer and inventor, died. 1468
  • The 15th Amendment (black suffrage) passed. 1870
  • The 16th Amendment, establishing federal income tax, was ratified. 1913
  • The Palestine National Congress appointed Yasir Arafat head of the Palestine Liberation Organization. 1969
  • Col. Eileen Collins became the first woman to pilot the space shuttle when the Discovery blasted off. 1995
  • Texas executed Karla Faye Tucker, the first woman to be executed in the United States since 1984. 1998

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