From Wall Street to Silicon Valley, these are the top stories that moved markets and had investors, business leaders, and entrepreneurs talking this week on Cheddar.
MARKET SLIPS
Stocks overall had a rough week despite a boost on Friday. The S&P managed to end up for the fifth straight week. While there were plenty of earnings beats and the weekly unemployment claims dropped to a new pandemic low, investors seemed to be wary of ongoing COVID-19 news and President Biden's announcement that his administration would pursue a capital gains tax hike to help pay for increased government spending on economic recovery.
CHIPOTLE EARNS
The fast casual Mexican cuisine franchise shook up Wall Street this week, meeting revenue expectations of $1.74 billion but also beating estimates on adjusted earnings per share with $5.36 versus the expected $4.89. Despite the sizzle coming from sales and digital growth, there still seemed to be a lack of heat for the restaurant's stock as it fell for the week.
STREAMING WARS
One would think revenue growth year-over-year of 24 percent would be a cause for some celebration, but in the high stakes streaming wars, the feat couldn't overcome the massive miss on new subscriptions. Instead of the six million customers that were expected to sign up to Netflix, the streaming giant saw just four million new accounts, a miss bad enough to hammer the stock in what was practically a straight line plunge on Wednesday. Meanwhile, streaming rival HBO Max's parent company AT&T had an entirely opposite experience on Thursday with its stock rocketing upwards on strong earnings, revenue, and growing subscription base.
APPLE EVENT
House of Mac unveiled quite a lot during its Spring Loaded event on Tuesday, including new iPad and iMac models that will feature its homegrown M1 processors, the AirTag item trackers that will allow you to use your iPhone to find lost objects you've tagged, and even a new season of Ted Lasso on Apple TV+. Investors certainly didn't hate what they see as the stock kept chugging along, up 0.55% for the week.
AIRLINES TAKE OFF
American and Southwest Airlines both announced that leisure bookings were up and that the carriers are planning on increasing the number of flights this summer in anticipation of air travelers returning as more people get vaccinated. American saw a smaller loss in the past quarter than in the previous four and saw its stock price get a bump on Friday. Southwest saw the first profit for a major airline during the pandemic and got a stock price jump on Friday to boot. Still, both carriers were down for the week overall.
Boeing workers at three Midwest plants where military aircraft and weapons are developed have voted to reject the company’s latest contract offer and to continue a strike that started almost three months ago. The strike by about 3,200 machinists at the plants in the Missouri cities of St. Louis and St. Charles, and in Mascoutah, Illinois, is smaller in scale than a walkout last year by 33,000 Boeing workers who assemble commercial jetliners. The president of the International Association of Machinists says Sunday's outcome shows Boeing hasn't adequately addressed wages and retirement benefits. Boeing says Sunday's vote was close with 51% of union members opposing the revised offer.
The stunning indictment that led to the arrest of more than 30 people — including Miami Heat guard Terry Rozier and other NBA figures — has drawn new scrutiny of the booming business of sports betting in the U.S. The multibillion-dollar industry has made it easy for sports fans — and even some players — to wager on everything from the outcome of games to that of a single play with just a few taps of a cellphone. But regulating the rapidly-growing industry has proven to be a challenge. Professional sports leagues’ own role in promoting gambling has also raised eyebrows.
Tesla, the car company run by Elon Musk, reported Wednesday that it sold more vehicles in the past three months after boycotts hit hard earlier this year, but profits still fell sharply. Third-quarter earnings fell to $1.4 billion, from $2.2 billion a year earlier. Excluding charges, per share profit of 50 cents came in below analysts' estimate. Tesla shares fell 3.5% in after-hours trading. Musk said the company's robotaxi service, which is available in Austin, Texas, and San Francisco, will roll out to as many as 10 other metro areas by the end of the year.
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