Tesla, Netflix, IBM, and Goldman Sachs: Stock Market Weekly Digest (17-21 April)
4 minutes for reading
Tesla, Netflix, IBM, and Goldman Sachs Group were in the spotlight this week. See how the stocks of these companies reacted to recent developments.
Netflix report: profit dropped 18%
On Tuesday 18 April, a first-quarter 2023 report was presented by Netflix Inc., a company owning a streaming service with the same name. The revenue saw an increase of 3.74% to $8.16 billion from the first-quarter 2022 figure, but analysts had forecast it to reach $8.17 billion. The net profit lost 18.28%, reaching $1.31 billion and $2.88 per share, while the consensus forecast had suggested $2.86.
Netflix Inc. announced that it was closing its DVD business which it started its history with. Over the quarter, the number of streaming service subscribers increased by 1.75 million to 232.5 million, while experts had expected growth of 2.06 million here.
However, the problem of a password exchange between users remains acute. According to the corporation, more than 100 million people are using the streaming platform from accounts of other users, never paying for subscriptions. On Wednesday, Netflix Inc. (NASDAQ: NFLX) shares dropped 3.17% to $323.12.
Goldman Sachs Group report: revenue did not live up to expectations again
On Tuesday, the first-quarter report was presented by the second-largest investment bank in the US Goldman Sachs Group Inc. Over the first three months of 2023, the revenue decreased 5.48% to $12.22 billion, while the consensus forecast had been $12.83 billion. The net profit dropped 17.90% to $3.23 billion or $8.79 per share, while the market had expected $8.24.
The revenue of the Global Banking and Markets segment lost 16.08% to $8.44 billion, and that of Asset & Wealth Management increased 24.02% to $3.22 billion. The loss from selling the retail fintech Marcus amounted to $470 million.
Investors interpreted the data negatively: on Tuesday, the quotes of Goldman Sachs Group Inc. (NYSE: GS) dropped 1.7% at the closing of the trading session, reaching $333.91. By the end of the week, they have almost fully recovered, rising to $338.71 per unit.
Tesla report: price decrease affected profit
On Wednesday 19 April, an American electric car maker Tesla Inc. presented its first-quarter 2023 financial report. The company announced growth of revenue over January-March by 24.38% to $23.33 billion, a decrease in the net profit by 24.26% to $2.51 billion or $0.73 per share.
The operating margin of Tesla Inc. amounted to 11.4% against 19.2% a year before and 16% in the previous quarter. The decrease in this indicator for two quarters in a row is the result of a decline in the price of Tesla electric cars. As you might recall, this year only the car maker decreased the price for Model 3 by 11% and for Model Y – by 20%.
Over Q1 2023, Tesla Inc. produced 440,808 electric cars and sold 422,875 vehicles; against the results of Q1 2022, this means growth of 44.34% and 36.39%, respectively.
On Wednesday, after the closing of trades the stock price of Tesla Inc. (NASDAQ: TSLA) dropped 6.07% to $169.63 per share. On Thursday, the quotes lost 9.75% more at the trade closing, reaching $162.99.
IBM report: profit grew 26%
On Wednesday, the American technology giant International Business Machines presented its first-quarter 2023 financial report. The revenue demonstrated growth of 0.39% to $14.25 billion, and the net profit – by 26.47% to $927 million or $1.02 per share. Experts polled by FactSet on average assessed the revenue of IBM as $14.35 billion and the net profit of the company – as $673.2 million.
The revenue of the Software segment rose 2.58% to $5.92 billion, that of the Consulting sector increased 2.75% to $4.96 billion, and of Infrastructure – dropped 3.76% to $3.10 billion. International Business Machines plans to increase its revenue by 3-5% by the end of the year, regardless of currency fluctuations.
On Thursday, the stock price of International Business Machines (NYSE: IBM) reached $126.36 per share, growing 0.03%. Since the beginning of the year, the company’s stock has lost 10.31%.
This week, quarterly reports were published by Netflix Inc., Goldman Sachs Group Inc., Tesla Inc., and International Business Machines. The quotes of all the companies dropped except for IBM shares which demonstrated minor growth.