Coffee With Greta: Tesla Crushes Q1 Expectations
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Good morning friends!
Futures are higher as traders digest the latest round of Q1 earnings.
Let’s get right to it!
Tesla Crushes Q1 Expectations
Tesla (TSLA) shares are rallying 8.7% ahead of the open after the electric automaker crushed Q1 expectations.
The company reported earnings of $3.22 per share on $18.76 billion in revenue.
That beat analysts’ expectations for EPS of $2.26 on $17.80 billion in revenue.
Revenue surged 81% year-over-year as Tesla delivered a record-high 310,000 vehicles last quarter.
The company's automotive margins jumped to a record 32.9% in Q1.
Tesla did not give detailed 2022 guidance but said it expects annual growth of 50% on a multi-year basis.
The company did warn supply constraints are expected to continue through the end of this year.
United Airlines Forecasts Profit in 2022
United Airlines (UAL) shares are up 8.3% in premarket trade after the airline forecast a return to profitability this year.
United’s Q1 performance was weaker than expected.
The company reported an adjusted loss of $4.24 per share vs analysts’ expectations for $4.22.
$7.57 billion in revenue was shy of analysts’ estimates for $7.68 billion.
Fuel costs jumped to $2.88 per gallon in the first quarter, up from $1.74 in 2021 and $2.05 in 2019.
United forecast its costs excluding fuel will rise 16% in Q2 compared to 2019.
The airline expects to fly 87% of its 2019 schedule this quarter.
American Airlines Expects Q2 Profit
American Airlines (AAL) shares are surging 10% ahead of the open after beating Q1 expectations and forecasting a return to profit soon.
The airline reported an adjusted loss of $2.32 per share on $8.9 billion in revenue.
That was better than analysts’ estimates for a loss of $2.40 on $8.826 billion in revenue.
American said its revenue March surpassed 2019 levels for the first time since the pandemic began.
The company forecast Q2 revenue up to 8% higher than three years ago and said it expects to fly 94% of its 2019 schedule this quarter.
Carvana Drops on Steep Q1 Loss
Carvana (CVNA) shares are tumbling 4.1% in premarket trade after reporting a steeper-than-expected Q1 loss.
The used-car retailer reported a loss of $2.89 per share and $2.25 billion in revenue.
Analysts were expecting a per-share loss of $1.44 and $3.4 billion in revenue.
In its letter to shareholders, Carvana said that loss was caused by higher volume than was needed last quarter.
The company also cited the spread of the omicron variant and used-car prices as factors that hurt its performance and said it had issues with “reconditioning and logistics network disruptions”.
Carvana declined to provide Q2 or full-year guidance.
Labor Market Remains Tight
The latest weekly jobless claims report shows the labor market remaining tight.
The Labor Department reported 184,000 Americans filed initial claims for unemployment benefits last week.
That was down 1,000 from the previous week and above economists’ expectations for 180,000.
Continuing claims fell by 58,000 to 1.417 million vs expectations for 1.459 million.
The U.S. labor market is nearing full employment levels as businesses struggle to find qualified workers.
Oil Prices Up
Oil prices are higher today as supply concerns remain.
West Texas Intermediate crude futures are up more than 1% to over $103 bbl while Brent crude futures are up 1.3% to over $108 bbl.
The International Energy Agency reported U.S. crude inventory tumbled by 8 million barrels in the week ending April 15.
That sharply missed expectations for an increase of 2.5 million barrels.
U.S. oil exports hit the highest level since March 2020 and imports fell to the lowest level since April 2021.
Libya is losing more than 550,000 barrels per day due to production shutdowns at some of its major oil facilities.
Analysts expect the oil market to remain volatile as the EU is still considering a ban on Russian oil.
Fed Beige Book
The Federal Reserve’s April Beige Book shows the U.S. economy expanded at a “moderate” pace between March and early April.
That report was released Wednesday.
Although that growth was an upgrade from the “modest to moderate” pace in the February Beige Book, the Fed cited uncertainty about the future due to high inflation and the war in Ukraine.
The bank said, “Outlooks for future growth were clouded by the uncertainty created by recent geopolitical developments and rising prices”.
The Beige Book also said the shortage of workers in the labor market remains the biggest obstacle to hiring.
Fed Chair Jerome Powell is set to address the International Monetary Fund in a speech about the global economy at 1:00 p.m. ET today.
Netflix’s Worst Day In 17 Years
Netflix (NFLX) shares cratered 35.1% on Wednesday, marking the streaming giant’s largest one-day decline since October 15, 2004.
That plunge wiped more than $50 billion off the company’s market cap.
Netflix reported a surprise net loss of 200,000 subscribers in Q1 and forecast a loss of 2 million subscribers in Q2.
The company blamed its “revenue growth headwinds” on password sharing and increased competition.
Netflix estimates more than 100 million global households are sharing passwords.
The company warned a crackdown on that practice is in the works.
NFLX shares are down 3.2% ahead of the open.
In Case You Missed It
- The National Association of Realtors reported existing home sales fell 2.7% in March to a SAAR of 5.77 million units. The median price of an existing home sold last month hit a new record-high at $375,300. There were 950,000 homes for sale at the end of March, representing a 2-month supply.