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Coffee With Greta: TSLA Tanks

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DJIA Futures: +87 (+0.2%)

SPX Futures: +19 (+0.4%)

NASDAQ Futures: +87 (+0.5%)

Good morning friends!

Futures are up after the release of strong economic data. 

Let’s get right to it!

Tesla Tumbles After Q4 Miss, Weak Outlook

Tesla (TSLA) shares are dropping 8.8% ahead of the open after missing Q4 expectations and issuing weak guidance for 2024. 

Here’s how the electric automaker’s results compared to analysts’ estimates:

  • Adjusted EPS: $0.71 vs $0.74 expected
  • Revenue: $25.17 billion vs $25.6 billion expected

Total revenue rose 3% year over year with automotive revenue up just 1%.

Tesla’s operating margin for the quarter was 8.2% vs 16% a year ago but up from 7.6% in Q3. 

The company said its vehicle volume growth in 2024 “may be notably lower” than last year as it works toward launching its “next-generation vehicle” in Texas.

Q4 GDP Growth Tops Estimates

The U.S. economy was much stronger than expected at the end of 2023. 

The Commerce Department’s first estimate shows GDP increased at a 3.3% annualized pace in the fourth quarter. 

That was better than economists’ expectations for a 2% growth rate and down from 4.9% in Q3. 

For the full year 2023, the U.S. economy expanded 2.5%. 

Consumer spending rose 2.8% in Q4, state and local government spending rose 3.7%, and federal government expenditures increased 2.5%. 

The PCE price index during the quarter, which is a measure of inflation, rose 2.7% vs 5.9% a year ago. 

The core PCE price index rose 3.2% vs 5.1% in Q4 2022. 

On a quarterly basis, headline inflation rose 1.7% while core inflation rose 2% from Q3.

Weekly Jobless Claims Jump

The number of new unemployment claims rose more than expected last week. 

The Labor Department reported 214,000 Americans filed initial claims for unemployment benefits. 

That was up by 25,000 from the previous week and higher than 199,000 expected.

Continuing claims rose by 27,000 to 1.833 million in the week ending January 13. 

American Airlines Jumps On Earnings, Guidance Beat

American Airlines (AAL) shares are rising 4.5% in premarket trade after beating Q4 expectations and issuing strong guidance. 

Here’s how the airline’s results compared to analysts’ estimates: 

  • Adjusted EPS: $0.29 vs $0.11 expected
  • Revenue: $13.1 billion vs $13 billion expected

Load factor, which measures how much passenger carrying capacity is used, came in at 83.6% vs 82.9% expected. 

American forecast full-year 2024 EPS between $2.25 and $3.25 vs $2.14 expected. 

The CEO said, “We are delivering on our commitments and remain well-positioned for the future, supported by the strength of our network and travel rewards program, our young and simplified fleet, our operational reliability, and our outstanding team.”

Southwest Tops Q4 Estimates

Southwest Airlines (LUV) are up 2.2% ahead of the open after beating Q4 expectations.

Here’s how the airline’s results compared to analysts’ estimates: 

  • Adjusted EPS: $0.37 vs $0.12 expected
  • Revenue: $6.8 billion vs $6.75 billion expected

Revenue per available seat mile (RASM) decreased 8.9% year over year. 

Load factor fell to 78.2% from 83.5% a year ago, missing expectations for 81.7%. 

Southwest forecast Q1 RASM will increase 2.5% to 4.5% yaer over year. 

The CEO said, “We currently expect to grow our full year 2024 available seat miles roughly 6%, year-over-year, all of which is carryover from 2023 network restoration related growth.”

In Case You Missed It

  • Meta Platforms (META) briefly surpassed a $1 trillion market cap during Wednesday’s session. The stock popped to around $396 per share to hit the milestone for the first time since 2021. META closed 1.4% higher at $390.70. Meantime, Microsoft (MSFT) briefly crossed $3 trillion in market value on Wednesday when the stock hit around $404 per share. MSFT closed 0.9% higher at $402.56 per share.

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