JD.com, C3.ai, Asana, and US Banks: Weekly Stock Market Digest (6-10 March)
JD.com, C3.ai, Asana, and US banks were in the spotlight this week. Below is a review of how their shares reacted to recent developments.
C3.ai stock lost 20% since Monday
C3.ai Inc. (NYSE: AI). which delivers an enterprise AI application development platform and enterprise AI applications saw a steep decline this week. The stock lost 20.3% since the beginning of the week, reaching $22.7 per unit.
On Monday 6 March, Kerrisdale Capital Management LLC hedge fund tweeted a short report on C3.ai Inc. It stated that the technology company is spending huge amounts of funds inefficiently, and its products are expensive and difficult to use, resulting in sales declining and net loss increasing. Kerrisdale Capital is confident that the partnership of C3.ai Inc. with its major client, Baker Hughes Company (NASDAQ: BKR), is doomed.
As you might recall, C3.ai Inc. last week reported its third quarter financial 2023 results, which exceeded Wall Street analysts’ expectations. Revenue for November to January fell 4.45% to $66.67 million from the same period in fiscal 2022, net loss added 60.12% to $63.16 million, and loss per share increased by 50% to $0.57.
JD.com report: revenue growth slows down
JD.com Inc., one of the leaders of electronic commerce in China, reported its fourth-quarter and full-year 2022 results on Thursday 9 March. Revenue for the October to December period increased by 7.08% to 295.45 billion CNY, net profit reached 3.03 billion CNY, and EPS amounted to 1.91 CNY. Annual revenue rose 9.95% to 1.05 trillion CNY, and net profit amounted to 10.38 billion CNY or 6.42 CNY per share.
The slowdown in revenue growth and management’s unclear outlook on the speed of consumer demand recovery in the Chinese market negatively impacted JD.com Inc.’s (NASDAQ: JD) stock. Consequently, the share price lost 11.28%, reaching $41.68 at the close of the trading session on Thursday.
Worst day for US banks in two years
On 9 March, it was announced that SVB Financial Group, the parent company of Silicon Valley Bank and a major creditor of the technology sector, one of the largest banks in the US, sold $1.75 billion worth of its shares to cover losses resulting from a massive decline in the number of deposits amid the ongoing interest rate hikes in the US.
At the close of the trading session on the same day, SVB Financial Group (NASDAQ: SIVB) shares crashed 60.41% to $106.04 per unit. On the post-market, the stock price fell another 21.82% to $82.9.
Recall that earlier this week another financial institution, Silvergate Capital Corp. (NYSE: SI), announced the winding down and liquidation of its cryptocurrency bank Silvergate. The news weighed on the whole banking sector, with investor doubts about the stability of its representatives causing panic in the market.
Consequently, Bank of America Corp (NYSE: BAC) quotes dropped 6.2% to $30.54, Wells Fargo & Company (NYSE: WFC) fell 6.18% to $41.13, JPMorgan Chase & Co (NYSE: JPM) plunged 5.41% to $130.34, and Citigroup Inc. (NYSE: C) lost 4.1% to $48.6. The stock of medium and small banks declined more dramatically: for example, the shares of First Republic Bank (NYSE: FRC) lost 16.51%, reaching $96.01.
Asana report: annual revenue up 45%
Asana Inc. which has developed a corporate platform for project management and workflow optimization reported on Thursday its fourth-quarter and fiscal year 2023 results (ended on 31 January 2023). The published statistics exceeded the expectations of the company’s management and market experts.
The November to January period saw a revenue increase of 34.2% to $150.23 million and a 5.53% rise in the net loss to $95.03 million or $0.44 per share. Annual revenue rose 44.51% to $490.65 million, net loss added 41.42% reaching $407.77 million, and loss per share rose 25.15% to $2.04.
The corporation expects revenue for the first quarter of fiscal 2024 to be $150-151 million and for the full year to reach $638-648 million. The release of the quarterly and annual reports as well as the forecast sent the stock of Asana Inc. (NYSE: ASAN) up 18.93% to $21.17. The quotes of the company have risen for six trading sessions in a row, adding 43.92% in total.
JD.com Inc. and Asana Inc. reported quarterly and annual results this week. JD.com Inc.’s quotes reacted with a decline, while Asana’s stock price reacted with growth.
Criticism of C3.ai Inc from Kerrisdale Capital Management LLC triggered a drop in C3.ai Inc. stock. The news from SVB Financial Group and Silvergate Capital Corp. hit US banks’ stock prices.