Coffee With Greta: Is This Netflix’s Big Comeback?
DJIA Futures: -186 (-0.6%)
SPX Futures: -28 (-0.8%)
NASDAQ Futures: -76 (-0.7%)
Good morning friends!
Futures are dropping despite strong Q3 results from several companies as economic concerns continue to weigh on the market.
Let’s get right to it!
Netflix Crushes Earnings Expectations
Netflix (NFLX) shares are surging 11.1% ahead of the open after crushing Q3 earnings and user growth expectations.
Here’s how the streaming giant’s results compared to analysts’ estimates:
- EPS: $3.10 vs $2.13 expected
- Revenue: $7.93 billion vs $7.837 billion expected
- New global paid net subscribers: 2.41 million vs 1.09 million expected
That user growth was more than double Netflix’s own projection for just 1 million and 1.43 million of the total were in the Asia Pacific region.
The company expects to add 4.5 million subscribers in the next quarter and revenue of $7.8 billion.
Netflix said it is “very optimistic” about its new ad supported tier that launches next month.
United Airlines Rallies After Reporting Q3 Profit, Upbeat Outlook
United Airlines (UAL) shares are up 5.4% in premarket trade after beating Q3 expectations on the top and bottom line.
Here’s how the airline’s results compared to analysts’ expectations:
- Adjusted EPS: $2.81 vs $2.28 expected
- Revenue $12.88 billion vs $12.75 billion expected
Revenue was up 13% from Q3 2019 as travelers paid higher prices for flights.
United forecast adjusted EPS of $2.25 per share in Q4, sharply higher than analysts’ estimates of $0.98.
The airline said it “now expects fourth quarter adjusted operating margin to be above 2019 for the first time.”
Higher Prices Boost Procter & Gamble
Procter & Gamble (PG) shares are up 1.6% ahead of the open after fiscal Q1 expectations.
Here’s how the consumer goods giant’s results compared to analysts’ estimates:
- EPS: $1.57 vs $1.54 expected
- Revenue $20.61 billion vs $20.28 billion expected
Higher prices for its products offset a 3% decline in sales volume.
The CFO said, “We feel very good about the consumer reaction to our price increases because we don’t see any major trade downs.”
P&G expects net sales to decline 1% to 3% in fiscal 2023 and EPS growth to be at the low end of its prior forecast of flat to up to 4%.
Housing Starts Tumble
New home construction fell more than expected in September.
The Commerce Department reported housing starts dropped 8.1% last month to a seasonally adjusted annual rate of 1.439 million units vs 1.47 million expected.
Starts were down 7.7% year over year as high rates put pressure on the market.
Single-family starts fell 4.7% while multi-family starts tumbled 13.1%.
Building permits rose 1.4% to a seasonally adjusted annual rate of 1.564 million units vs 1.54 million expected.
Mortgage Demand Drops to 25-Year Low
Mortgage demand hit a 25-year low last week as rates continue to climb.
The Mortgage Bankers Association reported purchase applications fell 4% weekly and were down 38% year over year.
Refinance applications fell 7% weekly and 86% annually.
The drop came as the average 30-year fixed contract rate rose to 6.94% from 6.81%.
That’s the highest rate on the MBA index since 2002.
More buyers turned to adjustable rate mortgages amid the higher rates.
The ARM share of applications rose to 12.8% last week, the highest since March 2008.
Upcoming Earnings
Here are the key companies set to report earnings after the market close today:
- Tesla (TSLA)
- IBM (IBM)