ReportWire

Tag: Breaking News: Earnings

  • Morgan Stanley shares pop 7% after beating estimates for third-quarter profit and revenue

    Morgan Stanley shares pop 7% after beating estimates for third-quarter profit and revenue

    [ad_1]

    Morgan Stanley on Wednesday topped analysts’ estimates for third-quarter profit as each of its three main divisions generated more revenue than expected.

    Here’s what the company reported:

    • Earnings:$1.88 a share vs $1.58 LSEG estimate
    • Revenue: $15.38 billion vs. $14.41 billion estimate

    The bank said profit rose 32% to $3.2 billion, or $1.88 per share, and revenue jumped 16% to $15.38 billion.

    Morgan Stanley had several tail winds in its favor, starting with buoyant markets that helped its massive wealth management business, a rebound in investment banking after a dismal 2023, and strong trading activity. The Federal Reserve began taking down rates in the quarter, which should encourage more of the financing and merger activity that Wall Street firms capitalize on.

    “The firm reported a strong third quarter in a constructive environment across our global footprint,” Morgan Stanley CEO Ted Pick said in the release.

    Shares of the bank rose 7.5% in early trading.

    The bank’s wealth management division saw revenue jump 14% from a year earlier to $7.27 billion, exceeding the StreetAccount estimate by nearly $400 million.

    Equity trading revenue rose 21% to $3.05 billion, compared with the $2.77 billion estimate, while fixed income revenue edged 3% higher to $2 billion, also higher than the $1.85 billion estimate.

    Investment banking revenue surged 56% from a year earlier to $1.46 billion, exceeding the $1.36 billion estimate.

    Investment management, the firm’s smallest division, also exceeded expectations, posting a 9% increase in revenue to $1.46 billion, modestly higher than the $1.42 billion estimate.

    Morgan Stanley’s Wall Street rivals also posted better-than-expected Wall Street revenue. JPMorgan Chase, Goldman Sachs and Citigroup topped estimates on strong revenue from trading and investment banking.

    This story is developing. Please check back for updates.

    [ad_2]

    Source link

  • Goldman Sachs to report third-quarter earnings

    Goldman Sachs to report third-quarter earnings

    [ad_1]

    David Solomon, Chairman & CEO Goldman Sachs, speaking on CNBC’s Squawk Box at the World Economic Forum Annual Meeting in Davos, Switzerland on Jan. 17th, 2024.

    Adam Galici | CNBC

    Goldman Sachs is scheduled to report third-quarter earnings before the opening bell Tuesday.

    Here’s what Wall Street expects:

    • Earnings: $6.89 per share, according to LSEG
    • Revenue: $11.8 billion, according to LSEG
    • Trading Revenue: Fixed Income of $2.91 billion, Equities of $2.96 billion, per StreetAccount
    • Investing Banking Revenue: $1.62 billion, per StreetAccount
    • Asset & Wealth Management: $3.58 billion, per StreetAccount

    How much will falling interest rates help Goldman Sachs?

    Over the past two years, the Federal Reserve’s tightening campaign has made for a less-than-ideal environment for investment banks like Goldman.

    Now that the Fed is easing rates, that positions Goldman to benefit as corporations that have waited on the sidelines to acquire competitors or raise funds begin to take action.

    Goldman’s asset and wealth management division is also positioned to benefit from rising asset values across markets as rates decline.

    Last week, rival JPMorgan Chase set expectations high with better-than-anticipated results from trading and investment banking, factors that helped the bank top earnings estimates.

    Wells Fargo also exceeded estimates on Friday on the back of its investment banking division.

    This story is developing. Please check back for updates.

    [ad_2]

    Source link

  • JPMorgan Chase is set to report third-quarter earnings – here’s what the Street expects

    JPMorgan Chase is set to report third-quarter earnings – here’s what the Street expects

    [ad_1]

    CEO of Chase Jamie Dimon looks on as he attends the seventh “Choose France Summit”, aiming to attract foreign investors to the country, at the Chateau de Versailles, outside Paris, on May 13, 2024.

    Lucovic Marin | Getty Images

    JPMorgan Chase is scheduled to report third-quarter earnings before the opening bell Friday.

    Here’s what Wall Street expects:

    • Earnings: $4.01 a share, according to LSEG
    • Revenue: $41.63 billion, according to LSEG
    • Net interest income: $22.73 billion, according to StreetAccount
    • Trading Revenue: Fixed income of $4.38 billion, Equities of $2.41 billion, according to StreetAccount

    JPMorgan will be watched closely for clues on how banks are faring at the start of the Federal Reserve’s easing cycle.

    The biggest American bank has thrived in a rising rate environment, posting record net income figures since the Fed started hiking rates in 2022.

    Now, with the Fed cutting rates, there are questions as to how JPMorgan will navigate the change. Like other big banks, it’s margins may be squeezed as yields on interest-generating assets like loans fall faster than its funding costs.

    Last month, JPMorgan dialed back expectations for 2025 net interest income and expenses, and analysts will want more details on those projections.

    Analysts will also want to hear JPMorgan CEO Jamie Dimon’s thoughts about the upcoming U.S. election and the industry’s efforts to push back against an array of regulatory moves to rein in fees and force banks to hold more capital.

    Shares of JPMorgan have jumped 25% this year, exceeding the 20% gain of the KBW Bank Index.

    Wells Fargo is scheduled to release results later Friday, while Bank of America, Goldman Sachs, Citigroup and Morgan Stanley report next week.

    This story is developing. Please check back for updates.

    [ad_2]

    Source link

  • Morgan Stanley tops estimates on stronger-than-expected trading and investment banking

    Morgan Stanley tops estimates on stronger-than-expected trading and investment banking

    [ad_1]

    Ted Pick, CEO Morgan Stanley, speaking on CNBC’s Squawk Box at the World Economic Forum Annual Meeting in Davos, Switzerland on Jan. 18th, 2024.

    Adam Galici | CNBC

    Morgan Stanley said second-quarter profit and revenue topped analysts’ estimates on stronger-than-expected trading and investment banking results.

    Here’s what the company reported:

    • Earnings: $1.82 a share vs. $1.65 a share LSEG estimate
    • Revenue: $15.02 billion vs. $14.3 billion estimate

    The bank said profit surged 41% from the year-earlier period to $3.08 billion, or $1.82 per share, helped by a rebound in Wall Street activity. Revenue rose 12% to $15.02 billion.

    Shares of the bank had declined earlier in the session after the bank’s wealth management division missed estimates on a decline in interest income. They were up less than 1% on Tuesday.

    Wealth management revenue rose 2% to $6.79 billion, below the $6.88 billion estimate, and interest income plunged 17% from a year earlier to $1.79 billion.

    Morgan Stanley said that’s because its rich clients were continuing to shift cash into higher-yielding assets, thanks to the rate environment, resulting in lower deposit levels.

    Morgan Stanley investors value the more steady nature of the wealth management business versus the less predictable nature of investment banking and trading, and they will want to hear more about expectations for the business going forward.

    Still, the bank benefited from its Wall Street-centric business model in the quarter, as a rebound in trading and investment banking helped the bank’s institutional securities division earn more revenue than its wealth management division, flipping the usual dynamic.

    Equity trading generated an 18% jump in revenue to $3.02 billion, exceeding the StreetAccount estimate by about $330 million. Fixed income trading revenue rose 16% to $1.99 billion, topping the estimate by $130 million.

    Investment banking revenue surged 51% to $1.62 billion, exceeding the estimate by $220 million, on rising fixed income underwriting activity. Morgan Stanley said that was primarily driven by non-investment-grade companies raising debt.

    “The firm delivered another strong quarter in an improving capital markets environment,” CEO Ted Pick said in the release. “We continue to execute on our strategy and remain well positioned to deliver growth and long-term value for our shareholders.”

    Last week, JPMorgan Chase, Wells Fargo and Citigroup each topped expectations for revenue and profit, a streak continued by Goldman Sachs on Monday, helped by a rebound in Wall Street activity.

    [ad_2]

    Source link

  • Bank of America shares jump 5% after saying net interest income rebound is coming

    Bank of America shares jump 5% after saying net interest income rebound is coming

    [ad_1]

    Bank of America on Tuesday said second-quarter revenue and profit topped expectations on rising investment banking and asset management fees.

    Here’s what the company reported:

    • Earnings: 83 cents a share vs. 80 cents a share LSEG estimate
    • Revenue: $25.54 billion vs. $25.22 billion estimate

    The bank said profit slipped 6.9% from the year earlier period to $6.9 billion, or 83 cents a share, as the company’s net interest income declined amid higher interest rates. Revenue climbed less than 1% to $25.54 billion.

    The firm was helped by a 29% increase in investment banking fees to $1.56 billion, edging out the $1.51 billion StreetAccount estimate. Asset management fees rose 14% to $3.37 billion, buoyed by higher stock market values, helping the firm’s wealth management division post a 6.3% increase in revenue to $5.57 billion, essentially matching the estimate.

    Net interest income slipped 3% to $13.86 billion, also matching the StreetAccount estimate.

    But new guidance on the measure, known as NII, gave investors confidence that a turnaround is in the making. NII is one of the main ways that banks earn money.

    The measure, which is the difference between what a bank earns on loans and what it pays depositors for their savings, will rise to about $14.5 billion in the fourth quarter of this year, Bank of America said in a slide presentation.

    That confirms what executives previously told investors, which is that net interest income would probably bottom in the second quarter.

    Wells Fargo shares fell on Friday when it posted disappointing NII figures, showing how much investors are fixated on the metric.

    Shares of Bank of America climbed 5.4%, aided by the NII guidance.

    Last week, JPMorgan Chase, Wells Fargo and Citigroup each topped expectations for revenue and profit, a streak continued by Goldman Sachs on Monday, helped by a rebound in Wall Street activity.

    Don’t miss these insights from CNBC PRO

    [ad_2]

    Source link

  • Goldman Sachs is set to report second-quarter earnings — here’s what Wall Street expects

    Goldman Sachs is set to report second-quarter earnings — here’s what Wall Street expects

    [ad_1]

    David Solomon, Goldman Sachs interview with David Faber, September 7, 2023.

    CNBC

    Goldman Sachs is scheduled to report second-quarter earnings before the opening bell Monday.

    Here’s what Wall Street expects:

    • Earnings: $8.34 per share, according to LSEG
    • Revenue: $12.46 billion, according to LSEG
    • Trading Revenue: Fixed Income of $2.96 billion, Equities of $3.17 billion, per StreetAccount
    • Investing Banking Revenue: $1.80 billion, according to StreetAccount

    Expectations have been set high for Goldman Sachs, with Wall Street businesses in the midst of a rebound after a dismal 2023.

    That’s because out of the six biggest U.S. banks, Goldman is the most reliant on investment banking and trading to generate revenue.

    Another focal point for the quarter will be in asset and wealth management, areas that Goldman CEO David Solomon has wagered can be a growth engine for the bank.

    On Friday, rivals JPMorgan Chase and Citigroup both topped expectations thanks to surging investment banking fees and better-than-expected equities trading results.

    Bank of America and Morgan Stanley report results on Tuesday.

    This story is developing. Please check back for updates.

    [ad_2]

    Source link

  • Citigroup tops expectations for profit and revenue on strong Wall Street results

    Citigroup tops expectations for profit and revenue on strong Wall Street results

    [ad_1]

    Jane Fraser, CEO of Citi, speaks during the Milken Institute Global Conference in Beverly Hills, California, on May 1, 2023. 

    Patrick T. Fallon | AFP | Getty Images

    Citigroup on Friday posted second-quarter results that topped expectations for profit and revenue on a rebound in Wall Street activity.

    Here’s what the company reported:

    • Earnings: $1.52 a share vs. $1.39 a share expected, according to LSEG
    • Revenue: $20.14 billion vs. $20.07 billion expected

    The bank said net income jumped 10% from a year earlier to $3.22 billion, or $1.52 a share. Revenue rose 4% to $20.14 billion.

    Equities trading revenue rose 37% to $1.5 billion, driven by strength in derivatives and a rise in hedge fund balances, roughly $300 million more than the StreetAccount estimate.

    Fixed income revenue dipped 3% to $3.6 billion, essentially matching analysts’ expectations, on lower activity in rates and currency markets.

    Investment banking revenue surged 60% to $853 million, driven by strong issuance of investment-grade bonds and a rebound in IPO and merger activity from low levels in 2023.

    Shares of the bank fell nearly 2%.

    “Our results show the progress we are making in executing our strategy and the benefit of our diversified business model,” Citigroup CEO Jane Fraser said in the release. “Markets had a strong finish to the quarter leading to better performance than we had anticipated.”

    Citigroup was just this week rebuked for failing to fix its regulatory shortfalls.

    Last year, Fraser announced plans to simplify the management structure and reduce costs at the third-biggest U.S. bank by assets. But earnings will take a backseat if Citigroup cannot appease regulators’ concerns about its data and risk management.  

    JPMorgan Chase announced results earlier Friday, while Goldman Sachs, Bank of America and Morgan Stanley report next week.

    Correction: This article has been updated to correct that Citigroup reported revenue of $20.14 billion for the second quarter. A previous version misstated the figure due to a rounding error.

    [ad_2]

    Source link

  • JPMorgan Chase is set to report second-quarter earnings – here’s what the Street expects

    JPMorgan Chase is set to report second-quarter earnings – here’s what the Street expects

    [ad_1]

    Jamie Dimon, chairman and chief executive officer of JPMorgan Chase & Co., speaks during an Economic Club of New York (ECNY) event in New York, US, on Tuesday, April 23, 2024. 

    Victor J. Blue | Bloomberg | Getty Images

    JPMorgan Chase is scheduled to report second-quarter earnings before the opening bell Friday.

    Here’s what Wall Street expects:

    • Earnings: $4.19 a share, according to LSEG
    • Revenue: $49.9 billion, according to LSEG
    • Net interest income: $22.8 billion, according to StreetAccount
    • Trading Revenue: Fixed income of $4.82 billion; Equities of $2.77 billion, according to StreetAccount

    Will cracks in the economy begin to reveal themselves in JPMorgan Chase results?

    While JPMorgan has passed numerous stress tests lately — actual and hypothetical — it’s possible the bank’s consumers could begin showing more strain from higher interest rates.

    Another open question is about succession at JPMorgan after CEO Jamie Dimon acknowledged in May that he now had less than five years remaining in his current role.

    Wells Fargo and Citigroup are scheduled to post results later Friday, while Goldman Sachs, Bank of America and Morgan Stanley report next week.

    This story is developing. Please check back for updates.

    [ad_2]

    Source link

  • NYCB shares jump after new CEO gives two-year plan for “clear path to profitability”

    NYCB shares jump after new CEO gives two-year plan for “clear path to profitability”

    [ad_1]

    A New York Community Bank stands in Brooklyn, New York City, on Feb. 8, 2024.

    Spencer Platt | Getty Images

    New York Community Bank on Wednesday posted a quarterly loss of $335 million on a rising tide of soured commercial loans and higher expenses, but the lender’s stock surged on its new performance targets.

    The first-quarter loss, equal to 45 cents per share, compared to net income of $2.0 billion, or $2.87 per share a year earlier. When adjusted for charges included merger-related items, the loss was $182 million, or 25 cents per share, deeper than the 15 cents per share loss estimate from LSEG.

    “Since taking on the CEO role, my focus has been on transforming New York Community Bank into a high-performing, well-diversified regional bank,” CEO Joseph Otting said in the release. “While this year will be a transitional year for the company, we have a clear path to profitability over the following two years.”

    The bank will have higher profitability and capital levels by the end of 2026, Otting said. That includes a return on average earning assets of 1% and a targeted common equity tier 1 capital level of 11% to 12%.

    Otting took over at the beleaguered regional bank at the start of April after an investor group led by former Treasury Secretary Steven Mnuchin injected more than $1 billion into the lender.

    Shares of the bank jumped 15% in premarket trading.

    This story is developing. Please check back for updates.

    [ad_2]

    Source link

  • Morgan Stanley tops expectations on wealth management, trading and investment banking results

    Morgan Stanley tops expectations on wealth management, trading and investment banking results

    [ad_1]

    Morgan Stanley on Tuesday posted results that topped analysts’ estimates for profit and revenue as wealth management, trading and investment banking exceeded expectations.

    Here’s what the company reported:

    • Earnings: $2.02 a share, vs. $1.66 expected, according to LSEG
    • Revenue: $15.14 billion, vs. expected $14.41 billion

    The bank said first-quarter profit rose 14% from a year earlier to $3.41 billion, or $2.02 a share, helped by rising results at each of its three main divisions. Revenue climbed 4% to $15.14 billion.

    Shares of the bank jumped about 2.5%.

    Wealth management revenue rose 4.9% to $6.88 billion, topping the StreetAccount estimate by $230 million, as rising markets helped boost fee revenue and offset a decline in interest income.

    Equities trading revenue increased 4.1% to $2.84 billion, $160 million more than expected, fueled by derivatives volumes. Fixed income trading revenue slipped 3.5% to $2.49 billion, but that still topped expectations by $120 million.

    Investment banking revenue jumped 16% to $1.45 billion, edging out the $1.40 billion estimate, as increases in debt and equity issuance offset lower fees from acquisitions.

    The firm’s smallest division, investment management, was the only major business to underperform expectations. While revenue climbed 6.8% to $1.38 billion, it was below the $1.43 billion StreetAccount estimate.

    CEO Ted Pick’s tenure had kicked off on a rocky note, as high interest rates have incentivized the bank’s wealth management customers to move cash into higher-yielding securities. The bank’s shares have declined nearly 7% this year before Tuesday.

    But like rivals including Goldman Sachs and JPMorgan Chase, Morgan Stanley was helped by strong trading and investment banking results in the quarter.

    Last week, JPMorgan, Wells Fargo and Citigroup each topped expectations for revenue and profit, a streak continued by Goldman on Monday and Bank of America on Tuesday.

    Analysts questioned Pick about reports that multiple U.S. regulators are investigating Morgan Stanley for potential shortfalls in how it screens clients for its wealth management division.

    “We’ve been focused on our client on-boarding and monitoring processes for a good while,” Pick said Tuesday. “We have been spending time, effort and money for multiple years, and it is ongoing. We’ve been on it and the costs associated with this are largely in the expense run rate.”

    [ad_2]

    Source link

  • Bank of America tops estimates on better-than-expected interest income, investment banking

    Bank of America tops estimates on better-than-expected interest income, investment banking

    [ad_1]

    Bank of America on Tuesday reported first-quarter earnings that topped analysts’ estimates for profit and revenue on better-than-expected interest income and investment banking.

    Here’s what the company reported:

    • Earnings: 83 cents a share adjusted, vs. 76 cents expected, according to LSEG
    • Revenue: $25.98 billion, vs. $25.46 billion expected

    The bank said profit fell 18% to $6.67 billion, or 76 cents a share; excluding a $700 million FDIC assessment, profit was 83 cents a share. Revenue slipped 1.6% to $25.98 billion as net interest income declined from a year earlier.

    Net interest income, or the difference between what the company earns from loans and investments and what it pays customers for their deposits, was $14.19 billion, topping the $13.93 billion StreetAccount estimate.

    The bank’s interest income was a “slight positive surprise,” though it’s unclear if this means the metric will improve earlier than expected, Wells Fargo analyst Mike Mayo said Tuesday in a research note.

    The bank’s total deposits of $1.95 trillion climbed roughly 1% from the fourth quarter, while loans were essentially unchanged at $1.05 trillion.

    “I was unimpressed with deposits and loans being flat,” David Wagner, portfolio manager at Aptus Capital Advisors, said in an email. “The only areas that BAC did well was where other banks have shown strength.”

    Bank of America CFO Alastair Borthwick told analysts Tuesday in a conference call that NII will likely dip in the second quarter to about $14 billion on drops in wealth management and markets interest income. Though it could grow in the second half of the year, he said.

    NII has been declining in recent quarters as funding costs have climbed along with the rise in interest rates.

    Shares of the bank fell more than 3%.

    Bank of America’s share decline Tuesday has more to do with the rise in the 10 year Treasury yield than first quarter results, according to KBW analyst David Konrad. Shares of many banks have been yoked to yields in the past year, as rising yields means some bond and loan holdings decline in value.

    Investment banking revenue jumped 35% to $1.57 billion, exceeding the $1.36 billion estimate and following a similar rise at rivals including Goldman Sachs and JPMorgan Chase.

    It’s also considerably higher than the guidance given by Borthwick, who told analysts last month to expect investment banking revenue to rise by 10% to 15% from a year earlier.

    The bank’s trading operations also edged out expectations. Fixed income revenue fell 3.6% to $3.31 billion, slightly beating the $3.24 billion estimate, and equities revenue rose 15% to $1.87 billion, compared with the $1.84 billion estimate.

    [ad_2]

    Source link

  • Goldman Sachs reports earnings before market open — here’s what the Street expects

    Goldman Sachs reports earnings before market open — here’s what the Street expects

    [ad_1]

    David Solomon, Chairman & CEO Goldman Sachs, speaking on CNBC’s Squawk Box at the World Economic Forum Annual Meeting in Davos, Switzerland on Jan. 17th, 2024.

    Adam Galici | CNBC

    Goldman Sachs is scheduled to report first-quarter earnings before the opening bell Monday.

    Here’s what Wall Street expects:

    • Earnings: $8.56 per share, according to LSEG
    • Revenue: $12.92 billion, according to LSEG
    • Trading Revenue: Fixed income of $3.64 billion and equities of $2.95 billion, per StreetAccount
    • Investing Banking Revenue: $1.77 billion, per StreetAccount

    Goldman Sachs CEO David Solomon has taken his lumps in the past year, but hope is building for a turnaround.

    Dormant capital markets and missteps tied to Solomon’s ill-fated push into retail banking should give way to stronger results this year.

    Rivals JPMorgan Chase and Citigroup posted better-than-expected trading results and a rebound in investment banking fees in the first quarter; investors will be disappointed if Goldman doesn’t show similar gains.

    Unlike more diversified rivals, Goldman gets most of its revenue from Wall Street activities. That can lead to outsized returns during boom times and underperformance when markets don’t cooperate.

    After pivoting away from retail banking, Goldman’s new emphasis for growth has centered on its asset and wealth management division. The business could see gains from buoyant markets at the start of the year, though it also has taken write-downs tied to commercial real estate in the past.

    Solomon may also field questions about the latest examples of an exodus in senior managers, including his global treasurer Philip Berlinski and Beth Hammack, co-head of the bank’s global financing group.

    On Friday, JPMorgan, Citigroup and Wells Fargo each posted quarterly results that topped estimates.

    This story is developing. Please check back for updates.

    Don’t miss these exclusives from CNBC PRO

    [ad_2]

    Source link

  • Citigroup tops estimates for first-quarter revenue on better-than-expected Wall Street results

    Citigroup tops estimates for first-quarter revenue on better-than-expected Wall Street results

    [ad_1]

    Citigroup on Friday posted first-quarter revenue that topped analysts’ estimates, helped by better-than-expected results in the bank’s investment banking and trading operations.

    Here’s how the company performed, compared with estimates from LSEG, formerly known as Refinitiv:

    • Earnings: $1.86 per share, adjusted, vs. $1.23 expected
    • Revenue: $21.10 billion vs. $20.4 billion expected

    The bank said profit fell 27% from a year earlier to $3.37 billion, or $1.58 a share, on higher expenses and credit costs. Adjusting for the impact of FDIC charges as well as restructuring and other costs, Citi earned $1.86 per share, according to LSEG calculations.

    Revenue slipped 2% to $21.10 billion, mostly driven by the impact of selling an overseas business in the year-earlier period.

    Investment banking revenue jumped 35% to $903 million in the quarter, driven by rising debt and equity issuance, topping the $805 million StreetAccount estimate.

    Fixed income trading revenue fell 10% to $4.2 billion, edging out the $4.14 billion estimate, and equities revenue rose 5% to $1.2 billion, topping the $1.12 billion estimate.

    The bank also posted an 8% gain to $4.8 billion in revenue in its Services division, which includes businesses that cater to the banking needs of global corporations, thanks to rising deposits and fees.

    Shares of the bank fell nearly 2% Friday.

    Citigroup CEO Jane Fraser previously said that her sweeping corporate overhaul would be complete by March, and that the firm would give an update to severance expenses along with first-quarter results.

    “Last month marked the end to the organizational simplification we announced in September,” Fraser said in the earnings release. “The result is a cleaner, simpler management structure that fully aligns to and facilitates our strategy.

    Last year, Fraser announced plans to simplify the management structure and reduce costs at the third-biggest U.S. bank by assets. The bank on Friday reiterated its medium term targets for returns hitting at least 11% and generating at least $80 billion in revenue this year.

    JPMorgan Chase reported results earlier Friday, and Goldman Sachs reports on Monday.

    Don’t miss these exclusives from CNBC PRO

    [ad_2]

    Source link

  • JPMorgan Chase is set to report first-quarter earnings — here’s what the Street expects

    JPMorgan Chase is set to report first-quarter earnings — here’s what the Street expects

    [ad_1]

    Jamie Dimon, President and CEO of JPMorgan Chase, speaking on CNBC’s “Squawk Box” at the World Economic Forum Annual Meeting in Davos, Switzerland, on Jan. 17, 2024.

    Adam Galici | CNBC

    JPMorgan Chase is scheduled to report first-quarter earnings before the opening bell Friday.

    Here’s what Wall Street expects:

    • Earnings: $4.11 a share, according to LSEG
    • Revenue: $41.85 billion, according to LSEG
    • Net interest income: $23.18 billion, according to StreetAccount
    • Trading Revenue: Fixed income of $5.19 billion and equities of $2.57 billion, according to StreetAccount

    JPMorgan will be watched closely for clues on how banks fared at the start of the year.

    While the biggest U.S. bank by assets has navigated the rate environment well since the Federal Reserve began raising rates two years ago, smaller peers have seen their profits squeezed.

    The industry has been forced to pay up for deposits as customers shift cash into higher-yielding instruments, squeezing margins. Concern is also mounting over rising losses from commercial loans, especially on office buildings and multifamily dwellings, and higher defaults on credit cards.

    Still, large banks are expected to outperform smaller ones this quarter, and expectations for JPMorgan are high. Analysts believe the bank can boost guidance for 2024 net interest income as the Federal Reserve is forced to maintain interest rate levels amid stubborn inflation data.

    Analysts will also want to hear what CEO Jamie Dimon has to say about the economy and the industry’s efforts to push back against efforts to cap credit card and overdraft fees.

    Wall Street may provide some help this quarter, with investment banking fees for the industry up 11% from a year earlier, according to Dealogic.

    Shares of JPMorgan have jumped 15% this year, outperforming the 3.9% gain of the KBW Bank Index.

    Wells Fargo and Citigroup are scheduled to release results later Friday, while Goldman Sachs, Bank of America and Morgan Stanley report next week.  

    This story is developing. Please check back for updates.

    Don’t miss these exclusives from CNBC PRO

    [ad_2]

    Source link

  • Foot Locker shares fall after heavy promotions lead to holiday-quarter losses

    Foot Locker shares fall after heavy promotions lead to holiday-quarter losses

    [ad_1]

    The Foot Locker logo is displayed in a store on May 19, 2023 in San Francisco, California. 

    Justin Sullivan | Getty Images

    Shares of Foot Locker fell in premarket trading Wednesday after the sneaker retailer reported a holiday-quarter loss and issued weak guidance for the current year.

    Here’s how the company did in its fourth fiscal quarter, compared with estimates from analysts surveyed by LSEG, formerly known as Refinitiv:

    • Earnings per share: 38 cents adjusted vs. 32 cents expected
    • Revenue: $2.38 billion vs. $2.28 billion expected

    The company swung to a loss in the three-month period that ended Feb. 3. Foot Locker lost $389 million, or $4.13 per share, compared with an income of $19 million, or 20 cents per share, a year earlier.

    Sales rose slightly to $2.38 billion, up about 2% from $2.34 billion a year earlier.

    For fiscal 2024, Foot Locker is expecting sales to be between down 1% and up 1%, compared to estimates of down half a percent, according to LSEG.

    It expects adjusted earnings per share to be between $1.50 and $1.70, compared with estimates of $1.40 to $2.30, according to LSEG.

    It’s been a little over a year since CEO Mary Dillon took the helm of Foot Locker. During her tenure, sales have consistently fallen as the retailer grappled with a changing mix of sneaker brands and a target consumer that has felt the brunt of inflation more acutely than those in higher income brackets. 

    Foot Locker has also been repositioning its Champs Sports brand and has grappled with high inventory levels that, unlike its peers, it has struggled to curb.

    In her past life as Ulta Beauty’s chief executive, Dillon skillfully won over buzzy beauty brands and turned the company into a powerhouse cosmetics retailer. When she took over as Foot Locker’s top boss in Sept. 2022, she was seen as the savior the legacy retailer sorely needed. 

    While Dillon inherited a slew of problems that existed long before she took over, and is still highly regarded across the retail industry, her turnaround of Foot Locker has come more slowly than some analysts had expected. 

    During its fiscal third quarter, Foot Locker eked out surprise beats on the top and bottom lines. Dillon told investors the company was making progress with its turnaround initiatives. The company inked a new marketing deal with the NBA, made plans to enter India and said the holiday quarter was off to a strong start.

    Last March, Dillon touted a renewed and revitalized relationship with Nike, which has long been the largest driver of Foot Locker’s sales. She has also sought to reduce the company’s reliance on the sneaker giant as it has focused on driving direct sales and squeezing out wholesalers.

    The relationship between the two brands still appears to be in a state of flux. On earnings calls, Nike routinely points to Dick’s Sporting Goods and JD Finish Line as its treasured wholesale partners.

    But in mid-February, Foot Locker announced a new partnership with its longtime supplier. The partnership, dubbed The Clinic, brings together Foot Locker, Nike and Jordan Brand, and will feature “interactive activations, high reach media, real life basketball clinics, social media content, community events and more.” 

    The partnership officially launched during the 2024 NBA All-Star Game in Indianapolis, In. 

    Read the full earnings release here. 

    [ad_2]

    Source link

  • Best Buy tops holiday quarter estimates but issues soft full-year guidance

    Best Buy tops holiday quarter estimates but issues soft full-year guidance

    [ad_1]

    People walk past a Best Buy store in Manhattan, New York City, November 22, 2021.

    Andrew Kelly | Reuters

    Best Buy surpassed Wall Street’s revenue and earnings expectations for the holiday quarter on Thursday, even as the retailer navigated through a period of tepid consumer electronics demand and guided to a softer year ahead.

    For this fiscal year, Best Buy anticipates revenue will range from $41.3 billion to $42.6 billion. That would mark a drop from the most recently ended fiscal year, when full-year revenue totaled $43.45 billion. It said comparable sales will range from flat to a 3% decline.

    One challenge that will affect sales in the year ahead: It is a week shorter. Best Buy said the extra week in the past fiscal year lifted revenue by about $735 million and boosted diluted earnings per share by about 30 cents.

    In a news release on Thursday, CEO Corie Barry said Best Buy expects the coming year to be one “of increasing industry sales stabilization.”

    She said the company is “focused on sharpening our customer experiences and industry positioning,” along with driving up its operating income rate. That metric is expected to improve in the coming year, as Best Buy benefits from changes to its annual membership program, a newer money maker for the retailer.

    Here’s what the consumer electronics retailer reported for its fiscal fourth quarter of 2024 compared with what Wall Street was expecting, based on a survey of analysts by LSEG, formerly known as Refinitiv:

    • Earnings per share: $2.72, adjusted vs. $2.52 expected
    • Revenue: $14.65 billion vs. $14.56 billion expected

    Best Buy has been in a period of slower sales in part due to the strength of its sales during the pandemic. Like home improvement companies, Best Buy saw outsized spending as shoppers were stuck at home. Plus, many items that the retailer sells like laptops, refrigerators and home theater systems tend to be pricier and less frequent purchases.

    The retailer has cited other challenges, too: Shoppers have been choosier about making big purchases while dealing with inflation-driven higher prices of food and more. Plus, they’ve returned to splitting their dollars between services and goods after pandemic years of little activity.

    Even so, Best Buy put up a quarter that was better than feared. In the three-month period that ended Feb. 3, the company’s net income fell by 7% to $460 million, or $2.12 per share, from $495 million, or $2.23 per share in the year-ago period. Revenue dropped from $14.74 billion a year earlier.

    Comparable sales, a metric that includes sales online and at stores open at least 14 months, declined 4.8% during the quarter as shoppers bought fewer appliances, mobile phones, tablets and home theater setups than the year-ago period. Gaming, on the other hand, was a strong sales category in the holiday quarter.

    In the U.S., Best Buy’s comparable sales dropped 5.1% and its online sales decreased by 4.8%.

    Best Buy paid dividends of $198 million and spent $70 million on share buybacks during the period. On Thursday, the company said its board of directors had approved a 2% increase in the regular quarterly dividend to 94 cents per share, which will be paid in April.

    As of Wednesday’s close, Best Buy’s shares are up nearly 2% so far this year. The company has underperformed the approximately 6% gains of the S&P 500 during that period. Shares of Best Buy closed at $79.68 on Wednesday, bringing the company’s market value to $17.16 billion.

    This is breaking news. Please check back for updates.

    [ad_2]

    Source link

  • Nvidia posts record revenue up 265% on booming AI business

    Nvidia posts record revenue up 265% on booming AI business

    [ad_1]

    Nvidia CEO Jensen Huang attends a media roundtable meeting in Singapore on Dec. 6, 2023.

    Edgar Su | Reuters

    Nvidia reported fourth fiscal quarter earnings that beat Wall Street’s forecast for earnings and sales, and said that revenue during the current quarter would be better than expected, even against elevated expectations for massive growth.

    Nvidia shares rose about 6% in extended trading.

    Here’s what the company reported compared with what Wall Street was expecting for the quarter ending in January, based on a survey of analysts by LSEG, formerly known as Refinitiv:

    • Earnings: $5.15 per share, adjusted, versus $4.64 per share expected.
    • Revenue: $22.10 billion, versus $20.62 billion expected.

    Nvidia said it expected $24.0 billion in sales in the current quarter. Analysts polled by LSEG were looking for $5.00 per share on $22.17 billion in sales. 

    Nvidia reported $12.29 billion in net income during the quarter, or $4.93 per share, up 769% versus last year’s $1.41 billion or 57 cents per share. 

    Nvidia has been the primary beneficiary of the recent technology industry obsession with large artificial intelligence models, which are developed on the company’s pricey graphics processors for servers.

    Nvidia’s total revenue rose 265% from a year ago, based on strong sales for AI chips for servers, particularly the company’s “Hopper” chips like the H100, it said.

    “Strong demand was driven by enterprise software and consumer internet applications, and multiple industry verticals including automotive, financial services, and healthcare,” the company said in commentary provided to investors.

    Those sales are reported in the company’s Data Center business, which now comprises the majority of Nvidia’s revenue. Data center sales were up 409% to $18.40 billion. Over half of the company’s data center sales went to large cloud providers.

    Nvidia said its data center revenue was hurt by recent U.S. restrictions on exporting advanced AI semiconductors to China.

    The company’s gaming business, which includes graphics cards for laptops and PCs, was merely up 56% year-over-year to $2.87 billion. Graphics cards for gaming used to be Nvidia’s primary business before its AI chips started taking off, and some of Nvidia’s graphics cards can be used for AI.

    Nvidia’s smaller businesses did not show the same meteoric growth. Its automotive business declined 4% to $281 million in sales, and its OEM and other business, which includes crypto chips, rose 7% to $90 million. Nvidia’s business making graphics hardware for professional applications rose 105% to $463 million.

    [ad_2]

    Source link

  • HSBC posts record annual profit but misses estimates on China write-down, shares tumble 7%

    HSBC posts record annual profit but misses estimates on China write-down, shares tumble 7%

    [ad_1]

    Customers use automated teller machines (ATM) at an HSBC Holdings Plc bank branch at night in Hong Kong, China, on Saturday, Feb 16, 2019.

    Anthony Kwan | Bloomberg | Getty Images

    HSBC‘s full-year 2023 pretax profit missed analysts’ estimates on Wednesday, hit by impairment costs linked to the lender’s stake in a Chinese bank, sinking its London-listed shares as much as 7%.

    Europe’s largest bank by assets saw its pre-tax profit climb about 78% to a record $30.3 billion in 2023 from a year ago, according to its statement released Wednesday during the mid-day trading break in Hong Kong. That missed median estimates of $34.06 billion from analysts tracked by LSEG.

    Chief Executive Noel Quinn also announced an additional share buyback of up to $2 billion to be completed ahead of the bank’s next quarterly earnings report. HSBC also said it would consider offering a special dividend of 21 cents per share in the first half of 2024 after it completes the sale of its Canada business.

    With the highest full-year dividend per share since 2008 and three share buy-backs in 2023 totaling $7 billion, Quinn said the bank returned $19 billion to shareholders last year.

    Quinn’s remuneration doubled to $10.6 million in 2023 from $5.6 million the year before, boosted in part by variable long-term incentives since his appointment in 2020.

    HSBC suffered a “valuation adjustment” of $3 billion on its 19% stake in China’s Bank of Communications, Quinn said. In an interview with CNBC following the earnings release, he said this is “a technical accounting adjustment” and “not a reflection” on BoComm.

    This write-down was among the items that plunged the bank’s fourth-quarter pretax profit by 80% to $1 billion from a year earlier.

    HSBC’s Hong Kong shares reversed gains of about 1% after trading resumed, falling as much as 5%. The benchmark Hang Seng Index was up about 2%. Shares in London were down around 7% in early deals, set for their biggest one-day drop since 2020, according to Reuters.

    Stock Chart IconStock chart icon

    HSBC shares

    Here are the other highlights of the bank’s full year 2023 financial report card:

    • Revenue for 2023 increased by 30% to $66.1 billion, compared with the median LSEG forecast for about $66 billion.
    • Net interest margin, a measure of lending profitability, was 1.66% — compared with 1.48% in 2022.
    • Common equity tier 1 ratio — which measures the bank’s capital in relation to its assets — was 14.8%, compared with 14.2% in 2022.
    • Basic earnings per share was $1.15, compared with the median LSEG forecast for $1.28 in 2023 and 75 cents for 2022.
    • Dividend per ordinary share was 61 cents — the highest since 2008 — compared with 32 cents in 2022.

    Outlook 2024

    HSBC, which has a second home in Hong Kong, said it was focusing on the fastest growing parts of Asia, a continent where the bank makes most of its profits.

    In an earnings briefing to investors and analysts, the bank said it has completed the sale of its businesses in France, Oman, Greece and New Zealand, and was in the process of exiting Russia, Canada, Mauritius and Armenia.

    HSBC CEO says it's 'still very confident' about China's economy

    The bank flagged two key macroeconomic trends: declining interest rates as inflation ebbs — a development that could eat into its interest income; and a continued reconfiguration of global supply chains and trade.

    “International expansion remains a core strategy for corporates and institutions seeking to develop and expand, especially the mid-market corporates that HSBC is very well-positioned to serve. Rather than de-globalizing, we are seeing the world re-globalize, as supply chains change and intraregional trade flows increase,” Quinn said in the earnings statement.

    The bank is targeting a mid-teens return on tangible equity for 2024, which was about 14.5% last year.

    HSBC said it will be focusing on an expansion of non-interest income revenue sources via its wealth and transaction banking business. It is expecting banking non interest income of at least $41 billion in financial year 2024.

    HSBC said it’s cautious about the loan growth outlook for the first half of 2024 amid economic uncertainty, expecting a mid-single digit annual percentage growth over the medium to long term.

    [ad_2]

    Source link

  • Palantir stock jumps 19% as AI demand drives revenue beat

    Palantir stock jumps 19% as AI demand drives revenue beat

    [ad_1]

    Palantir co-founder and CEO Alex Karp arrives for a U.S. Senate bipartisan Artificial Intelligence Insight Forum at the U.S. Capitol in Washington, D.C., on Sept. 13, 2023.

    Stefani Reynolds | AFP | Getty Images

    Palantir shares surged more than 19% in after-hours trading on Monday after the company reported fourth-quarter earnings that beat analysts’ expectations for revenue. Full-year guidance for 2024 came roughly in line with Wall Street’s estimates.

    Here’s how the company did:

    • Earnings per share: 8 cents adjusted vs. 8 cents expected by LSEG, formerly known as Refinitiv
    • Revenue: $608.4 million vs. $602.4 million expected by LSEG

    Revenue in the fourth quarter increased 20% to $608.4 million from $508.6 million a year earlier. The company reported a net income of $93.4 million, or 4 cents per share, compared with $30.9 million, or 1 cent per share, in the year-ago quarter.

    In a letter to shareholders, Palantir CEO Alex Karp said the company’s expansion and growth “have never been greater,” especially as demand for large language models in the U.S. “continues to be unrelenting.” Palantir has been rolling out its Artificial Intelligence Platform, or AIP, and Karp said the company carried out nearly 600 pilots with the technology in 2023, up from fewer than 100 in 2022.

    “Our results reflect both the strength of our software and the surging demand that we are seeing across industries and sectors for artificial intelligence platforms,” Karp wrote.

    Palantir said it expects to report between $612 million and $616 million in revenue during its first quarter, and forecast revenue for the full year of $2.65 billion to $2.67 billion. Wall Street was expecting sales of $617 million for the first quarter and $2.66 billion for the year.

    Palantir, known for its defense and intelligence work with the U.S. government, said its U.S. commercial revenue grew 70% year over year. Palantir said its U.S. commercial customer count increased 55% from 143 customers to 221 customers.

    In the prior period, Palantir reported its fourth straight quarter of profitability, which means it’s now eligible for inclusion in the S&P 500.  

    WATCH: Palantir shares climb after earnings show jump in commercial customers

    [ad_2]

    Source link

  • Meta shares jump more than 10% after profit triples and company announces first-ever dividend

    Meta shares jump more than 10% after profit triples and company announces first-ever dividend

    [ad_1]

    Mark Zuckerberg, CEO, Meta Platforms, in July 2021.

    Kevin Dietsch | Getty Images News | Getty Images

    Meta beat on earnings and revenue in its fourth-quarter report on Thursday and announced its first-ever dividend payment. The stock jumped more than 10% in extended trading.

    • Earnings: $5.33 per share. That may not compare with the $4.96 per share expected by LSEG, formerly known as Refinitiv.
    • Revenue: $40.1 billion. That may not compare with the $39.18 billion expected by LSEG

    Wall Street will also be looking at these key user numbers:

    • Daily active users (DAUs): $2.11 billion vs. 2.08 billion expected, according to StreetAccount
    • Monthly active users (MAUs): $3.07 billion vs. 3.06 billion expected, according to StreetAccount
    • Average revenue per user (ARPU): $13.12 vs. $12.81 expected, according to StreetAccount

    Meta said it has declared its first dividend, which is pegged at 50 cents. The company also announced a $50 billion share buyback.

    Revenue jumped 25% in the quarter from $32.2 billion a year earlier, the fastest rate of growth for any period since mid-2021. Meanwhile, the company’s cost and expenses decreased 8% year-over-year to $23.73 billion.

    The company’s operating margin more than doubled from a year earlier to 41%, a clear sign that the company’s cost-cutting measures are bolstering profitability.

    Net income more than tripled to $14 billion, or $5.33 per share, from $4.65 billion, or $1.76 per share, a year earlier.

    The company said that sales in its Reality Labs unit passed $1 billion in the first quarter, and recorded $4.65 billion in losses.

    “We had a good quarter as our community and business continue to grow,” Meta CEO Mark Zuckerberg said in a statement. “We’ve made a lot of progress on our vision for advancing AI and the metaverse.”

    Meta said it expects first-quarter sales to be in the range of $34.5 billion to $37 billion. The company said that its expects its 2024 expenses to be in the range of of $94 billion to $99 billion.

    [ad_2]

    Source link