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.
ROBINHOOD IPO FIZZLES
Online brokerage firm Robinhood had one of the worst public debuts for a company of its size in more than a decade, as critics lambasted the investing app and co-founder Vlad Tenev fell under investigation for failing to register with the Financial Industry Regulatory Authority, a top Wall Street regulator. The stock started trading at $38 per share, already on the low end of its range, before plummeting 10 percent and ending the day around $34 per share, bumping up to $35 on Friday. Big-name investors such as Michael Burry and Warren Buffett criticized the company, which has presided over the recent boom in retail investing, for encouraging excessive risk-taking.
TECH EARNINGS MIXED
Tech earnings were a mixed bag this week. For Amazon CEO Andy Jassy's first quarter at the helm, the e-commerce giant reported another $100 billion quarter but missed sales expectations for the first time in a long time. Shares dropped 7 percent on the news. At Facebook, digital ad spending fueled a 56 percent pop in revenue, even as the company warned of a longer-term slowdown due to headwinds in the changing ad targeting business. Google parent company Alphabet, meanwhile, crushed Wall Street expectations, with a 69 percent jump in total ad revenue.
EVs: GOOD NEWS AND BAD NEWS
EV companies saw rallies, IPOs, and fraud charges this week. Tesla's stock soared Thursday on the news that the infrastructure package coming out of Congress could include $7.5 billion to build 500,000 electric vehicle chargers throughout the country. Lucid Motors also made its public debut via a merger with a special purpose acquisition company, as reservations for its electric luxury sedan stack up and CEO Peter Rawlinson hopes to vie for the status of the "Next Tesla." In the meantime, a federal grand jury charged Trevor Milton, founder of electric truck company Nikola, with three counts of criminal fraud for lying about multiple aspects of his business.
ACTIVISION WALKOUT
Stocks of Activision Blizzard slumped this week as employees staged a walkout after California filed a lawsuit against the video game company alleging widespread discrimination and sexual harassment of women and other marginalized groups. The workers demanded better working conditions and an end to the abusive practices. CEO Bobby Kotick issued a statement calling the company's response so far "tone deaf."
MCWINNING
Chicken sandwiches and celebrity-sponsored meals powered an earnings beat at fast-food giant McDonald's this week. The company reported a 25.9 percent jump in same-store sales, crediting its new Crispy Chicken Sandwich and its "famous orders" promotion, which pairs meals with big-name pop stars. The latest promotion brought together an order of McNuggets and special sauces with K-pop group BTS. Next on the docket is hip-hop star Saweetie, whose "Saweetie 'N Sour" will include a Big Mac, four-piece Chicken McNuggets, medium fries, a medium Sprite, and BBQ sauce.
Nvidia on Wednesday became the first public company to reach a market capitalization of $5 trillion. The ravenous appetite for the Silicon Valley company’s chips is the main reason that the company’s stock price has increased so rapidly since early 2023.
Chris Williamson, Chief Business Economist at S&P Global, breaks down September’s CPI print and inflation trends, explaining what it means for markets.
A big-screen adaptation of the anime “Chainsaw Man” has topped the North American box office, beating a Springsteen biopic and “Black Phone 2.” The movie earned $17.25 million in the U.S. and Canada this weekend. “Black Phone 2” fell to second place with $13 million. Two new releases, the rom-com “Regretting You” and “Springsteen — Deliver Me From Nowhere,” earned $12.85 million and $9.1 million, respectively. “Chainsaw Man – The Movie: Reze Arc” is based on the manga series about a demon hunter. It's another win for Sony-owned Crunchyroll, which also released a “Demon Slayer” film last month that debuted to a record $70 million.
The Federal Aviation Administration says flights departing for Los Angeles International Airport were halted briefly due to a staffing shortage at a Southern California air traffic facility. The FAA issued a temporary ground stop at one of the world’s busiest airports on Sunday morning soon after U.S. Transportation Secretary Sean Duffy predicted that travelers would see more flights delayed as the nation’s air traffic controllers work without pay during the federal government shutdown. The hold on planes taking off for LAX lasted an hour and 45 minutes and didn't appear to cause continued problems. The FAA said staffing shortages also delayed planes headed to Washington, Chicago and Newark, New Jersey on Sunday.
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.
