Jim Cramer has been considering a potential investment in BlackRock, the world’s largest asset manager, and we’re now adding it to our Bullpen stocks-to-watch list. The news BlackRock shares surged to a record high Friday after the firm posted third-quarter earnings that crushed analysts’ expectations, yet again. Management also announced that assets under management reached another record high, an incredible $11.5 trillion, on surging inflows as the stock market rallied. “We’ve added $2 trillion organically over the last five years. $2 trillion is the equivalent of being in the ranks of the sixth largest asset managers,” CEO Larry Fink told CNBC on Friday after the release. Fink also praised BlackRock’s recent $12.5 billion acquisition of Global Infrastructure Partners, which added more than $100 billion in assets. Big picture The financial industry kicked off quarterly earnings Friday. In addition to BlackRock, Club name Wells Fargo was among the companies that delivered strong results. Morgan Stanley , also in the portfolio, reports next Wednesday. It’s been a murky operating environment for the Wall Street behemoths, which were forced to navigate higher-for-longer interest rates until the Federal Reserve finally cut rates last month. The Fed’s next move has been a point of debate. Right after last month’s jumbo 50-basis-point cut, the market had expected another 75 basis points worth of cuts before year-end. Now that odds favor just 50. Bottom line BlackRock’s stellar quarterly results highlight another reason for the Club to consider an initiation of the stock. That’s why we put the stock in the Bullpen. Management’s track record draws us in further as Fink expands the firm’s footprint in private markets, and delivers quarter after quarter of steller inflows. BlackRock shares have been on a tear recently – up more than 12% in the past month versus the S & P 500’s roughly 4% gain. Jim Cramer said Friday he knows the stock has run a lot, “but that doesn’t mean it can’t run more.” Why have we waited to pull the trigger on the stock? Jim said Thursday he wished he had but he’s been dealing with Wells Fargo and Morgan Stanley, and we don’t make these moves in haste. (Jim Cramer’s Charitable Trust is long MS, WFC. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
BlackRock CEO Larry Fink speaks during the New York Times DealBook Summit Nov. 30, 2022 in New York City.
Michael M. Santiago | Getty Images News | Getty Images
Jim Cramer has been considering a potential investment in BlackRock, the world’s largest asset manager, and we’re now adding it to our Bullpen stocks-to-watch list.
Michael Santomassimo, Wells Fargo CFO, joins 'Money Movers' to discuss the story with the company's quarter, how the company is gaining market share, and much more.
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.
Michael Yoshikami, CEO of Destination Wealth Management, looks ahead to US financial earnings ahead of Friday. He expects lower net interest margins, but fewer defaults.
Traders are staring down a series of risks after the stock market’s torrid start to the year, from economic fear, to interest rate uncertainty, to election angst. But perhaps the most important variable for whether equities can keep rolling returns to the spotlight this week: corporate earnings.
The S&P 500 Index has soared roughly 20% in 2024, adding more than $8 trillion to its market capitalization. The gains have largely been driven by expectations of easing monetary policy and resilient profit outlooks.
But the tide may be turning as analysts slice their expectations for third-quarter results. Companies in the S&P 500 are expected to report a 4.7% increase in quarterly earnings from a year ago, according to data compiled by Bloomberg Intelligence. That’s down from projections of 7.9% on July 12, and it would represent the weakest increase in four quarters, BI data show.
“The earnings season will be more important than normal this time,” said Adam Parker, founder of Trivariate Research. “We need concrete data from corporates.“
In particular, investors are eager to see if companies are postponing spending, if demand has slowed, and if customers are behaving differently due to geopolitical risk and macro uncertainty, Parker said. “It is exactly because there is a lot going on in the world that corporate earnings and guidance will particularly matter now,” he said.
Reports from major companies start arriving this week, with results from Delta Air Lines Inc. due Thursday and JPMorgan Chase & Co. and Wells Fargo & Co. scheduled for Friday.
“Earnings seasons are typically positive for equities,” said Binky Chadha, chief US equity and global Strategist at Deutsche Bank Securities Inc. “But the strong rally and above-average positioning going in (to this earnings season) argue for a muted market reaction.”
Obstacles Abound
The obstacles facing investors right now are no secret. The US presidential election is just a month away with Democrat Kamala Harris and Republican Donald Trump in a tight, fierce race. The Federal Reserve has just started lowering interest rates, and while there’s optimism about an economic soft-landing, questions remain about how fast central bankers will reduce borrowing costs. And a deepening conflict in the Middle East is raising concerns about inflation heating up again, with the price of West Texas Intermediate oil rising 9% last week, the biggest weekly gain March 2023.
“The bottom line is that revisions and guidance are weak, indicating lingering concerns about the economy and reflecting some election year seasonality,” said Dennis DeBusschere of 22V Research. “That is helping set up reporting season as another uncertainty clearing event.”
Plus, to make matters more challenging, big institutional investors have little buying power at the moment and seasonal market trends are soft.
Positioning in trend-following systematic funds is now skewed to the downside, and options market positioning shows traders may not be ready to buy any dips. Commodity trading advisers, or CTAs, are expected to sell US stocks even if the market stays flat in the next month, according to data from Goldman Sachs Group Inc. And volatility control funds, which buy stocks when volatility drops, no longer have room to add exposure.
History appears to side with the pessimists, too. Since 1945, when the S&P 500 gained 20% through the first nine months of the year, it posted a down October 70% of the time, data compiled by Bespoke Investment Research show. The index gained 21% this year through September.
Bar Lowered
Still, there’s reason for optimism, specifically a lowered bar for earnings projections that leaves companies more room to beat expectations.
“Estimates got a little bit too optimistic, and now they’re pulling back to more realistic levels,” said Ellen Hazen, chief market strategist at F.L.Putnam Investment Management. “It will definitely be easier to beat earnings because estimates are lower now.”
In fact, there’s plenty of data suggesting that US companies remain fundamentally resilient. A strengthening earnings cycle should continue to offset stubbornly weak economic signals, tipping the scales for equities in a positive direction, according to Bloomberg Intelligence. Even struggling small-cap stocks, which have lagged their large-cap peers this year, are expected to see improving margins, BI’s Michael Casper wrote.
Friday’s jobs report, which showed the unemployment rate unexpectedly declined, quelled some concerns about a soft labor market.
Another factor is the Fed’s easing cycle, which has historically been a boon for US equities. Since 1971, the S&P 500 has posted an annualized return of 15% during periods in which the central bank cut rates, data compiled by Bloomberg Intelligence show.
Those gains have been even stronger when rate-cutting cycles hit in non-recessionary periods. In those cases, large caps posted an averaged annualized return of 25% compared with 11% when there was a recession, while small caps gained 20% in non-recessionary periods compared with 17% when there was a recession.
“Unless earnings are a major disappointment, I think the Fed will be a bigger influence over markets between now and year-end simply because earnings have been pretty consistent,” said Tom Essaye, founder and president of Sevens Report Research. “Investors expect that to continue.”
A worker unloads a new Tesla Model 3 from a truck at a logistics drop zone in Seattle, Washington, US, on Thursday, Aug. 22, 2024.
Bloomberg | Bloomberg | Getty Images
Tesla posted its third-quarter vehicle production and deliveries report on Wednesday. The stock fell about 3.5% in premarket trading after the report.
Here are the key numbers:
Total deliveries Q3 2024: 462,890
Total production Q3 2024: 469,796
Analysts were expecting deliveries of 463,310 in the period ending Sept. 30, according to estimates compiled by FactSet StreetAccount.
Deliveries are not defined in Tesla’s financial disclosures, but are the closest approximation to units sold reported by the company. It’s one of the most closely-watched metrics on Wall Street.
In the year-ago period, Tesla reported 435,059 deliveries and production of 430,488 EVs. Last quarter, the company reported 443,956 deliveries, and production of 410,831 vehicles.
Tesla is facing increased competitive pressure, especially in China, from companies like BYD and Geely, along with a new generation of automakers, including Li Auto and Nio.
In the U.S., EV competitors like Rivian are maturing, while legacy automakers Ford and General Motors are selling more electric vehicles after walking back more ambitious goals for electrification.
GM this week reported a roughly 60% increase in EV sales for the third quarter from a year earlier. Still, its electric business is tiny compared to Tesla’s, with just 32,100 units sold in the latest period, accounting for 4.9% of the company’s total sales.
Ford plans to report results on Wednesday.
Tesla hasn’t issued specific guidance for 2024 deliveries, but executives have said they expect a lower delivery growth rate this year versus last despite the company having added a new vehicle, the angular stainless steel Cybertruck, to their lineup.
The company also said on Wednesday that it deployed 6.9 GWh of energy storage products in the quarter.
Shares of Tesla climbed 32% in the third quarter, erasing their loss for the year in the process. The stock is now up almost 4% in 2024, trailing the Nasdaq, which has gained 19%.
Tesla’s brand has been under pressure in the U.S. due in part to the antics of CEO Elon Musk, who, in addition to endorsing former President Donald Trump, has shared what the White House called “racist hate,” and false claims about immigrants and election fraud on X, his social media app.
But Tesla still sells more battery electric vehicles in the U.S. than any other automaker, with Hyundai a distant second.
In its third-quarter earnings report later this month, investors will be particularly focused on profit margins.
Tesla has continued to offer attractive financing options and an array of incentives to drive sales volume in recent months in China as well as in the U.S. Prior to earnings, Tesla will host a marketing event on Oct. 10, and is expected to show off the design of “dedicated robotaxi.”
Musk has promised Tesla self-driving cars for years, but the company has yet to deliver. Meanwhile competitors like Waymo and Pony.ai have begun operating commercial robotaxi services.
Volkswagen AG cut its guidance for a second time this year, warning that waning demand will undercut the German carmaker’s profitability as it squares off with unions over possible job cuts and unprecedented plant closures.
The manufacturer said Friday that it now sees an operating margin of 5.6%. That’s down from a prediction of as much as 7% in July, when VW previously lowered its expectations, partly due to expected costs from closing an Audi plant in Belgium. Net cash flow in the automotive division is now expected to be less than half the level the company had foreseen.
All three major German carmakers — Volkswagen, Mercedes-Benz Group AG and BMW AG — have now warned about their profit this month. They’re each struggling with slower sales in China, where buyers are holding back because of a deepening real estate crisis. Rising competition in electric vehicles also is driving steep discounts and crimping margins, all while declining consumer confidence saps demand for combustion-engine cars.
Volkswagen’s outlook cut adds to the challenges for Chief Executive Officer Oliver Blume, who has warned that costs in Germany are too high as EV growth slows and Chinese manufacturers led by BYD Co. push into Europe.
The company is considering plant closures in Germany for the first time in its history and has scrapped decades-long job security pledges as it tries to become more competitive. Executives have flagged about two car plants’ worth of excess capacity, which put them on course for a protracted conflict with powerful labor groups.
“The news aids the VW brand’s case to close overcapacity in Germany,” Bloomberg Intelligence analyst Giacomo Reghelin said. “As with Mercedes, we expect further profit warnings to follow.”
VW now expects net cash flow in the automotive division to reach around €2 billion ($2.2 billion), down from as much as €4.5 billion previously, partly because of M&A activities including a partnership with Rivian Automotive Inc. on EV technology.
Volkswagen said its namesake passenger-car brand and its commercial vehicles unit are performing below expectations. It flagged added risks for its high-volume carmaking group, which also includes Skoda and Seat, citing a “deterioration in the macroeconomic environment.”
The company’s global deliveries will drop to around 9 million units this year, from 9.24 million in 2023, VW said Friday. The automaker had previously forecast a 3% increase.
Earlier this month, rival BMW warned its 2024 earnings would be significantly lower than a year ago after a faulty braking system from supplier Continental AG prompted a recall and halt to deliveries of some 1.5 million vehicles. The auto-making operating margin would be as low as 6%, compared to a previous low of 8%, the company forecast.
Mercedes-Benz followed with its own warning as the deepening rout in China hurt sales of its most expensive models like the S-Class and Maybach sedans. Adjusted returns this year would be between 7.5% and 8.5%, compared with an earlier forecast of as much as 11%, and earnings before interest and taxes will be “significantly below” the prior year level, the automaker said last week.
DALLAS — DALLAS (AP) — Southwest Airlines executives on Thursday unveiled their vision for Southwest 2.0, an airline that for the first time will give passengers assigned seats, charge them extra for more legroom and offer red-eye flights but bags still will fly free.
The airline announced that it plans to end the open-boarding system it has used for more than 50 years and start flights with assigned seats during the first half of 2026 as it responds to shifting consumer tastes and tries to reverse a three-year slump in profits.
CEO Robert Jordan and other Southwest executives outlined the future refresh during an investor meeting in Dallas where they tried to convince shareholders that they can increase revenue by winning over younger and more affluent customers.
The moves away from Southwest’s simple business model and quirky traditions come as airline management faces pressure from activist investor Elliott Investment Management. The hedge fund blames management for Southwest’s recent underperformance compared with its closest rivals, and wants to replace Jordan and most of the Southwest board.
Along with introducing assigned seats, the airline will make about one-third of them higher-priced premium seats with up to five inches of extra legroom. That will require removing a row of seats on some planes. Work to retrofit the fleet will start in the first half of next year and be completed by the end of 2026, executives said.
Southwest said those moves, along with changes to its network, will add about $1.5 billion in pretax earnings in 2027.
Before Thursday’s event started, Southwest announced a $2.5 billion share-buyback program designed to make existing shares more valuable. It also said that a third-quarter revenue ratio will rise by up to 3% instead of being between flat and down 2%.
Shares of Southwest Airlines Co. rose 8% in midday trading.
Southwest is trying to fend off a possible proxy fight as early as next week with Elliott, which is the airline’s second-largest shareholder.
“We do not support the company’s current course, which is being charted in a haphazard manner by a group of executives in full self-preservation mode,” the hedge fund said this week in a letter to other shareholders.
Jordan argued that the plan laid out Thursday should satisfy investors.
“We do not believe that a proxy fight is in the best interest of the company, and we remain willing to work with Elliott on a cooperative approach,” he said.
Jordan said the refresh plan had been in the works a long time. “For Elliott to call that plan rushed and haphazard, in my opinion, is inane.
Elliott did not immediately comment on Jordan’s remarks.
In dumping open seating, Southwest said its surveys show that 80% of its customers now want to know their seat before they get to the airport instead of having to search for open seats when they board the plane.
As part of the switch, the airline will have four airfare tiers, each offering more convenience and comfort. Southwest officials said the premium product will appeal to business travelers.
Southwest stopped short of changing another of its longtime characteristics: letting passengers check up to two bags for free, a break from fees that are charged by all other leading U.S. airlines. Executives said it’s the most important feature in setting Southwest apart from rivals.
U.S. airlines brought in more than $7 billion in revenue from bag fees last year, with American and United reaping more than $1 billion apiece. Wall Street has long argued that Southwest is leaving money behind.
Southwest, which has built years of advertising campaigns around bags-fly-free, estimated that bag fees would raise about $1.5 billion a year, but eliminating the perk could drive away passengers, costing the airline $1.8 billion, or a net loss of $300 million a year.
Southwest has been contemplating an overhaul for months, but the push for radical change became even more important to management this summer, when Elliott Investment Management targeted the company for its dismal stock performance since early 2021.
Company management headed into the investor day having angered an important interest group: its own workforce. The airline told employees Wednesday that it will make sharp cuts to service in Atlanta next year, resulting in the loss of 340 pilot and flight attendant positions.
Employee unions are watching the fight between Elliott Investment Management and airline management, but they are not taking sides. “That’s between Southwest and Elliott, and we’ll see how it plays out,” Alison Head, a flight attendant and union official in Atlanta, said.
However, the unions are concerned that more of their members could be forced to relocate or commute long distances to keep their jobs. Southwest’s chief operating officer told employees last week that the airline will have to make “difficult decisions” about its network to improve its financial performance.
Elliott seized on that comment, saying that Southwest leaders are now “taking any action – no matter how short-sighted – that they believe will preserve their own jobs.”
The hedge fund controlled by billionaire financier Paul Singer now owns more than 10% of Southwest shares and is the airline’s second-biggest shareholder. It wants to fireCEO Jordan and Chairman Gary Kelly and replace two-thirds of Southwest’s board. Elliott has a slate of 10 director candidates, including former airline CEOs.
Southwest gave ground this month, when it announced that six directors will leave in November and Kelly will step down next year. On Thursday, it named And it named a former AirTran and Spirit Airlines CEO to its board.
The airline is digging in to protect Jordan, however.
Shawn Cole, a founding partner of executive search firm Cowen Partners, whose firm has worked for other airlines but not Southwest, believes Southwest is too insular and should follow the recent examples of Starbucks and Boeing and hire an outsider as CEO. He thinks many qualified executives would be interested in the job.
“It would be a challenge, no doubt, but Southwest is a storied airline that a lot of people think fondly of,” Cole said. “If Boeing can do it, Southwest can do it.”
Growing grocery delivery business and other opportunities
The company also said it’s hitting pause on a new fulfilment centre to help save costs in its grocery delivery business Voilà, among other changes.
“While the market penetration of Voilà continues to be strong, the size and growth of the Canadian grocery e-commerce market is smaller than anticipated, resulting in higher net earnings dilution than originally estimated,” Empire said in its press release. The company says it’s focusing on driving volume and performance at its three existing centres.
Empire also prematurely ended its mutual exclusivity agreement with technology provider Ocado, as part of changes it’s made to lower costs and increase flexibility. The changes “are expected to have a significant, positive impact on Voilà’s profitability in fiscal 2025 and 2026,” Empire said. The company says its profit amounted to $0.86 per diluted share for the 13-week period ended Aug. 3.
The result was down from a profit of $1.03 per diluted share in the same quarter last year when its bottom line was boosted by the sale of 56 gas stations in Western Canada.
Analyst take on Empire’s quarter
RBC analyst Irene Nattel said Empire’s operating results came in “a tick above forecast as consumer value-seeking behaviour stabilizes.” She said in a note that the company continues to execute on its strategy to maximize revenue in its full-service stores, despite the broader momentum in discount stores, though she added Empire is also growing its discount presence. Nattel has previously said Empire is overly exposed to the full-service part of the grocery sector compared with its competitors, giving it a relative disadvantage amid heightened price sensitivity.
Empire earnings highlights
Here’s a breakdown of the results this week.
Empire Company (EMP/TSX): Earnings per share of $0.63 (versus $0.62 predicted). Revenue of $7.41 billion (meeting the prediction).
Sales for what was the company’s first quarter totalled $8.14 billion, up from $8.08 billion a year earlier. Same-store sales for the quarter were up 0.5%, while same-store sales, excluding fuel, increased 1%.
Medline said a year and a half after completing the rollout of loyalty program Scene+ across Canada, the program has more than 15 million members, with those members spending on average 55% more than non-members. “Scene+ has significantly boosted our incremental sales and margin compared to our prior loyalty program,” he said.
On an adjusted basis, Empire says it earned $0.90 per share in its latest quarter, up from an adjusted profit of $0.78 per diluted share in the same quarter last year. Shares in Empire closed up 5.6% on the Toronto Stock Exchange at $40.62.
BRP (NASDAQ:DOOO – Get Free Report) is scheduled to be posting its quarterly earnings results before the market opens on Friday, September 6th. Analysts expect BRP to post earnings of $0.22 per share for the quarter.
BRP Price Performance
Shares of NASDAQ DOOO opened at $69.54 on Wednesday. The stock has a market cap of $5.16 billion, a PE ratio of 12.58 and a beta of 2.06. BRP has a fifty-two week low of $57.15 and a fifty-two week high of $79.84. The company has a debt-to-equity ratio of 4.23, a quick ratio of 0.46 and a current ratio of 1.35. The stock has a fifty day moving average of $68.02 and a 200-day moving average of $67.04.
Analyst Upgrades and Downgrades
Several equities research analysts have issued reports on DOOO shares. Citigroup lifted their price target on BRP from $73.00 to $80.00 and gave the stock a “buy” rating in a research note on Tuesday, July 16th. CIBC dropped their price target on BRP from $110.00 to $100.00 and set an “outperformer” rating on the stock in a research report on Monday, June 3rd. National Bank Financial cut BRP from an “outperform” rating to a “sector perform” rating in a research report on Wednesday, August 21st. Finally, Stifel Nicolaus cut BRP from a “buy” rating to a “hold” rating in a report on Wednesday, August 21st. Four equities research analysts have rated the stock with a hold rating, two have assigned a buy rating and one has given a strong buy rating to the stock. According to MarketBeat.com, the company currently has a consensus rating of “Moderate Buy” and an average target price of $122.75.
BRP Inc, together with its subsidiaries, designs, develops, manufactures, distributes, and markets powersports vehicles and marine products in the United States, Canada, Europe, the Asia Pacific, Mexico, Austria, and internationally. The Powersports segment offers year-round products, such as Can-Am all-terrain vehicles, side-by-side vehicles, and three-wheeled vehicles; and seasonal products, including Ski-Doo and Lynx snowmobiles, Sea-Doo personal watercrafts and pontoons, Rotax engines for karts and recreational aircraft, and Pinion gearboxes with smart shift systems.
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The short answer is yes, absolutely. But that doesn’t mean it’s a piece of cake.
Since you’ll be more empowered to succeed if you understand the state of music revenue in 2024, this article contain 13 truths about earning money as a musician.
Driving your own creative & business success at the same time isn’t easy.
You have to wear at least two hats well: artist and entrepreneur.
And in a field that evolves as rapidly as the music industry (which stands at the intersection of technology, culture, marketing, and more), you’ve got to stay on your toes.
Plus, many recent events have impacted artist revenue, including:
So if we begin with the premise that success takes talent, knowledge, hard work, and continued curiosity, here are 13 things you should know right now in order to grow your music earnings.
13 hard truths about earning money in music
The point of this list is to help you see through a lot of thecommon confusions, and avoid the pitfalls that prevent many artists from making progress.
Some of these truths may sound obvious to you, and if so, great! They’re lessons you won’t have to learn the hard way. But believe me, even in 2024, they’re still things that many artists don’t know, or don’t want to accept.
1. Just because you made music doesn’t automatically mean it will make you money.
Music is not a scarcity! There are nearly infinite alternatives to your music.
The same way that new food products don’t just magically arrive in stores and fly off the shelves by themselves (it takes branding, distribution, promotion, etc.), you will have to work to create demand for your music. If you expect your music to generate revenue, that work doesn’t stop at the end of the creation process.
2. What’s good for the “industry” can be very different from what’s good for you.
Sometimes the music industry and individual creators have different needs and desires. And it’s easy to learn the wrong lessons from industry headlines.
“Indie music” as a sector may be healthier than ever, but you’re just one artist. You, ultimately, pay your own bills. Focus on what’s best for you and take headlines and quotes from CEOs with a grain of salt.
That being said, I think the recent LUMINATE report did a great job conveying big industry-wide stats while also telling a more detailed and encouraging story about lesser-known artists.
3: Making money from music is part mystery. It’s an artform, as well as a science.
What becomes popular is not predictable. What worked yesterday doesn’t always work today. Some geniuses go unrecognized. Your least favorite original song might be your biggest hit.
This uncertainty is part of what makes music so exciting. You never know when and where success might come from.
Use this to fuel creativity, and don’t be afraid to try new things. And as they say in marketing circles, “test, test, test.”
4: Make it easy for people to give you money.
Seriously. Are you… selling stuff? If not, your first problem is making things — music, merch, concerts, experiences — that you can actually sell to fans.
Then you need to consistently create offers. Compelling offers. Next, communicate those offers. By email. In your social bio. Everywhere else.
Lastly, when you do make offers, you should give fans options. Not everyone wants a black t-shirt. Certain people won’t go to public shows, but they’ll pay for a livestream. Some fans will pay you more for a VIP pre-show hang.
The point is: Many artists underperform on the revenue side because they just aren’t giving fans an opportunity to pay them.
5: Any deal an artist signs will have serious financial implications.
There is a time and place for record labels, managers, and booking agents. But all industry partnerships will have an impact on your earnings. Don’t wait until it’s too late to truly understand what those implications are.
Know what you’re getting yourself into. Not just in the near-term. Ask yourself, “What could this arrangement mean for my music in 25 years?”
The trade-offs could be well worth it. But ask the hard questions BEFORE you sign a deal.
6: Popular artists often have a skewed vantage point on the actual economics of streaming, but they have the loudest platform.
While there is much to be learned from popular artists, they can often give up-and-coming artists the wrong impression on certain aspects of the business, because they’re playing a different game at a different level.
When someone famous talks about not earning any money from tens of millions of streams, keep in mind, you don’t know what’s happening behind-the-scenes and you don’t have THEIR label or publishing contracts to reference.
How much does their label keep? What was the artist’s advance? How many co-writers were on the song? All that and more can complicate the revenue situation, when compared to an independent artist who owns 100% of their publishing and recording rights.
Also, just because an artist is popular, it doesn’t necessarily mean they know how every aspect of the industry works.
7: Your personal preferences around music consumption might lead you to missed opportunities.
You might be getting in the way of more revenue, if you assume that all your possible fans behave just like you do. As an artist who also listens to music, you may have specific preferences. But you might not 100% match your audience in those preferences.
For example, you might assume no one purchases CDs because you only listen to streaming, whereas CDs are still a huge source of revenue for artists. You might only share a Spotify link, when 40% of your audience is actually on Amazon Music. Maybe you want to press vinyl, but most of your fans are more inclined to pay you for a digital experience.
The point is simple: Don’t assume everyone listens, engages, and spends money exactly like you do. Ask your audience. Take polls. Test the waters. And move in the direction that generates the most revenue.
8: You (probably) won’t make a living from one song. Focus on building a catalog.
Most of the independent artists I’ve seen succeed over the years made a solid living because they built a sizable catalog of songs. This, of course, gives them more chances to create hit songs, but also boosts the amount of tracks that can be licensed, streamed, played at concerts, etc.
So every time they released new music, their fans could go back and listen to old stuff, thus with every new release came an extra wave of revenue from past material.
9. Your biggest opportunity might not be from simply “releasing” songs, but monetizing the connection you have with fans.
Don’t pin success (or revenue) entirely to the recorded music. We live in a social moment that thrives on engagement. Some of your best earning possibilities might arise from the fan experience AROUND your music, or from what they can do WITH your music.
Subscriptions, access, livestreams, lessons, and meetups. To say nothing of fan-generated content.
10. It’s the music “business,” so treat it like you would a job.
This is a challenge for most of us artists: We spend too much time dreaming and not enough time doing. I’m guilty of it too. We want a “career,” but the work? Not so much.
If you want your music to be a full-time job, time and effort must consistently be at the level you’d expect from a “regular” job.
11. In order to maximize music revenue, you have to tell people exactly what to do.
As artists we struggle to give fans clear directions. But people need to be told, shown, guided. That’s the power of a big, bright button with an obvious call-to-action on websites or emails.
Some artists struggle to be clear and direct because we lack confidence in our music or offer. Others might feel like we look uncool or desparate if we ask fans to take an action. And for another set of artists, we just assume our fans know what to do next. But most of the time they don’t.
Always make an attempt to clarify the action you want fans to take, why it benefits them, how it’s important to you,and provide simple instructions on how to do the thing!
12. One viral video does not equal sustainable revenue.
Trying to engineer one massive, viralvideo hit? I mean, okay, that’s fine. You’ll learn something from the attempt even if it doesn’t get the reach you dream of. But most successful musicians didn’t put all their eggs in one viral video basket. Even creators who have a massive video hit don’t always have an obvious way to transform that attention into true fans and customers, let alone a full-time living.
Instead, most successful musicians who create a meaningful video presence did so because they established a sustainable process that was closely connected with their own musical identity, passions, and talents. It’s about momentum, and it’s about the right fans being there for the right reasons: Because they like what YOU do.
Don’t chase memes and trends. Find a more compelling way to be YOU on camera. And then slowly build your social marketing efforts around that. The ongoing process will likely have a greater impact than trying to engineer one viral video. And that’s the way to build an “authentic” social brand that leads to real revenue.
13. Just because it worked for Taylor Swift, doesn’t mean it will work for you.
Looking to superstars for lessons in success can be a mixed bag.
When Radiohead dropped In Rainbows for free nearly 20 years ago, every band wanted to copy the attempt. But they weren’t Radiohead. When Beyoncé released a secret album, everyone wanted to do secret albums. They weren’t Beyoncé.
When Drake released a hard drive with… (well, maybe don’t try that one either).
The point is: There are economies of scale at play with superstar artists. That means they don’t have to work as hard to incentivize fans to take action, because they’ve already put in the work to establish a close relationship with their audience.
What works for them might not work for you. But the opposite can also be true. You can take certain chances they can’t, and even capitalize on efforts that aren’t scalable at all! The realm of independent music is full of innovation, by necessity. You don’t have the name, budget, or team that superstars do. There may by ways to use that to your advantage!
Key takeaways
Here are four things to keep in mind as you pursue your music career:
Prioritize activities that generate revenue – don’t just chase likes.
Look for untapped revenue opportunities that align with your individual career plan and talents.
Don’t blindly follow headlines or advice. Test assumptions, marketing tactics, and even creative approaches.
And lastly, if you need help spreading the word about your music, use music promo tools to give your message a boost!
Want to learn more about your revenue-generating options as a musician today?
Chip manufacturing behemoth Nvidia reported record second-quarter revenue on growing demand for its data centers, hardware and AI models. “Data center revenue of $26.3 billion was a record, up 16% sequentially and up 154% year-on-year,” Chief Financial Officer Colette Kress said in the company’s earnings release on Aug. 28. Nvidia attributed its data center growth […]
JD.com set up an Innovative Retail division that houses its grocery business 7Fresh.
Bloomberg | Bloomberg | Getty Images
Hong Kong-listed shares of Chinese online retailer JD.com climbed 1.2% on Wednesday, outperforming the decline on the Hang Seng index after the firm announced a $5 billion buyback late Tuesday.
U.S. listed shares of the firm rose 2.24% on Tuesday after the announcement. Both JD.com’s Hong Kong and U.S. shares have dropped about 20% year to date.
In comparison, Hong Kong’s benchmark Hang Seng index was down about 0.82% Wednesday, but is up about 4% for the year so far.
The announcement is JD.com’s second buyback this year, after announcing a $3 billion buyback in March.
In response to the move, Chelsey Tam, senior equity analyst at Morningstar, said that the decision to announce the share buyback is “not surprising.” She explained, “It is a common theme in China when share prices and growth are low.”
China’s e-commerce sector has been dogged by a slow domestic economy.
Earlier this month, Alibaba’s second-quarter results missed expectations on both the top and bottom lines. On Monday, Temu-owner Pinduoduo saw its worst ever session after its second-quarter results missed both revenue and earnings per share expectations.
TD Bank took a provision of $2.6 billion in the third quarter as it estimates the cost of fines from its U.S.-based money laundering compliance lapses. During the Canadian bank’s Q3 earnings call, Chief Executive Bharat Masrani gave an update on TD’s remediation program resulting from the U.S. money laundering investigations. He said the bank […]
Cisco Systems is planning to lay off 7% of its employees, its second round of job cuts this year, as the company shifts its focus to more rapidly growing areas in technology, such as artificial intelligence and cybersecurity.
The company based in San Jose, California, did not specify the number of jobs it is cutting. It had 84,900 employees as of July 2023. Based on that figure, the number of jobs cut would be about 5,900. In February, Cisco announced it would cut about 4,000 jobs.
The networking equipment maker said in June that it would invest $1 billion in tech startups like Cohere, Mistral and Scale to develop reliable AI products. It recently also announced a partnership with Nvidia to develop infrastructure for AI systems.
Cisco’s layoffs come just two weeks after chipmaker Intel Corp. announced it would cut about 15,000 jobs as it tries to turn its business around to compete with more successful rivals like Nvidia and AMD. Intel’s quarterly earnings report disappointed investors and its stock took a nosedive following the announcement. In contrast, Cisco’s shares were up about 6% after-hours on Wednesday.
In a foray into cybersecurity, Cisco launched a cybersecurity readiness index back in March to help businesses measure their resiliency against attacks.
Cisco Systems Inc. said Wednesday it earned $2.16 billion, or 54 cents per share, in its fiscal fourth quarter that ended on July 27, down 45% from $3.96 billion, or 97 cents per share, in the same period a year ago. Excluding special items, its adjusted earnings were 87 cents per share in the latest quarter.
Revenue fell 10% to $13.64 billion from $15.2 billion.
Analysts, on average, were expecting adjusted earnings of 85 cents per share on revenue of $13.54 billion, according to a poll by FactSet.
For the current quarter, Cisco is forecasting adjusted earnings of 86 cents to 88 cents per share on revenue of $13.65 billion to $13.85 billion. Analysts are expecting earnings of 85 cents per share on revenue of $13.74 billion.
Edward Jones analyst David Heger said Cisco is starting to see demand recover after it slowed over the past few quarters, noting that product orders were up 6% even when excluding those from its recent acquisition of cybersecurity firm Splunk.
He added that “the restructuring will help offset the earnings impact from interest expenses associated with financing the Splunk acquisition and will rationalize combined workforces.”
Cisco Systems is planning to lay off 7% of its employees, its second round of job cuts this year, as the company shifts its focus to more rapidly growing areas in technology, such as artificial intelligence and cybersecurity.
The company based in San Jose, California, did not specify the number of jobs it is cutting. It had 84,900 employees as of July 2023. Based on that figure, the number of jobs cut would be about 5,900. In February, Cisco announced it would cut about 4,000 jobs.
The networking equipment maker said in June that it would invest $1 billion in tech startups like Cohere, Mistral and Scale to develop reliable AI products. It recently also announced a partnership with Nvidia to develop infrastructure for AI systems.
Cisco’s layoffs come just two weeks after chipmaker Intel Corp. announced it would cut about 15,000 jobs as it tries to turn its business around to compete with more successful rivals like Nvidia and AMD. Intel’s quarterly earnings report disappointed investors and its stock took a nosedive following the announcement. In contrast, Cisco’s shares were up about 6% after-hours on Wednesday.
In a foray into cybersecurity, Cisco launched a cybersecurity readiness index back in March to help businesses measure their resiliency against attacks.
Cisco Systems Inc. said Wednesday it earned $2.16 billion, or 54 cents per share, in its fiscal fourth quarter that ended on July 27, down 45% from $3.96 billion, or 97 cents per share, in the same period a year ago. Excluding special items, its adjusted earnings were 87 cents per share in the latest quarter.
Revenue fell 10% to $13.64 billion from $15.2 billion.
Analysts, on average, were expecting adjusted earnings of 85 cents per share on revenue of $13.54 billion, according to a poll by FactSet.
For the current quarter, Cisco is forecasting adjusted earnings of 86 cents to 88 cents per share on revenue of $13.65 billion to $13.85 billion. Analysts are expecting earnings of 85 cents per share on revenue of $13.74 billion.
Edward Jones analyst David Heger said Cisco is starting to see demand recover after it slowed over the past few quarters, noting that product orders were up 6% even when excluding those from its recent acquisition of cybersecurity firm Splunk.
He added that “the restructuring will help offset the earnings impact from interest expenses associated with financing the Splunk acquisition and will rationalize combined workforces.”
Ballard Power Systems (NASDAQ:BLDP – Get Free Report) (TSE:BLD) released its earnings results on Monday. The technology company reported ($0.11) earnings per share (EPS) for the quarter, beating the consensus estimate of ($0.13) by $0.02, Briefing.com reports. The company had revenue of $16.00 million during the quarter, compared to analyst estimates of $19.36 million. Ballard Power Systems had a negative return on equity of 15.37% and a negative net margin of 177.82%. Ballard Power Systems’s quarterly revenue was up 4.6% on a year-over-year basis. During the same period in the prior year, the company posted ($0.10) earnings per share.
Ballard Power Systems Stock Up 7.1 %
BLDP opened at $1.97 on Wednesday. The stock has a market cap of $589.84 million, a PE ratio of -3.18 and a beta of 1.77. The company has a quick ratio of 10.88, a current ratio of 11.66 and a debt-to-equity ratio of 0.03. Ballard Power Systems has a 52 week low of $1.77 and a 52 week high of $4.70. The business’s fifty day simple moving average is $2.37 and its 200 day simple moving average is $2.77.
Analyst Ratings Changes
BLDP has been the subject of several research reports. Truist Financial reduced their price objective on Ballard Power Systems from $3.00 to $2.00 and set a “hold” rating for the company in a report on Tuesday. CIBC reissued an “underperformer” rating and set a $1.60 price objective (down from $3.50) on shares of Ballard Power Systems in a report on Tuesday. Wells Fargo & Company dropped their target price on Ballard Power Systems from $3.00 to $2.00 and set an “underweight” rating on the stock in a research report on Tuesday. HSBC dropped their target price on Ballard Power Systems from $4.10 to $3.80 and set a “buy” rating on the stock in a research report on Wednesday, May 8th. Finally, BMO Capital Markets lowered their price objective on Ballard Power Systems from $2.25 to $1.70 and set an “underperform” rating on the stock in a research report on Tuesday. Five research analysts have rated the stock with a sell rating, eight have given a hold rating and two have assigned a buy rating to the company’s stock. Based on data from MarketBeat.com, the stock has an average rating of “Hold” and an average price target of $3.18.
Ballard Power Systems Inc engages in the design, development, manufacture, sale, and service of proton exchange membrane (PEM) fuel cell products. The company offers its products for power product comprising for bus, truck, rail, marine, stationary, and emerging market, such as material handling, off-road, and other applications.
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Sergio Ermotti, chief executive officer of UBS Group
Stefan Wermuth | Bloomberg | Getty Images
ZURICH, Switzerland ꟷ UBS CEO Sergio Ermotti said Wednesday that market volatility could intensify in the second half of the year, but he does not believe the U.S. is heading into a recession.
Global equities saw sharp sell-offs last week as investors digested weak economic data out of the U.S. which raised fears about an economic downturn in the world’s largest economy. It also raised questions about whether the Federal Reserve needed to be less hawkish with its monetary policy stance. The central bank kept rates on hold in late July at a 23-year high.
When asked about the outlook for the U.S. economy, Ermotti said: “Not necessarily a recession, but definitely a slowdown is possible.”
“The macroeconomic indicators are not clear enough to talk about recessions, and actually, it’s probably premature. What we know is that the Fed has enough capacity to step in and support that, although it’s going to take time, whatever they do to be then transmitted into the economy,” the CEO told CNBC on Wednesday after the bank reported its second-quarter results.
UBS expects that the Federal Reserve will cut rates by at least 50 basis points this year. At the moment, traders are split between a 50 and a 25 basis point cut at the Fed’s next meeting in September, according to LSEG data.
Speaking to CNBC, Ermotti said that we are likely to see higher market volatility in the second half of the year, partially because of the U.S. election in November.
“That’s one factor, but also, if I look at the overall geopolitical picture, if I look at the macroeconomic picture, what we saw in the last couple of weeks in terms of volatility, which, in my point of view, is a clear sign of the fragility of some elements of the system, … one should expect definitely a higher degree of volatility,” he said.
Another uncertainty going forward is monetary policy and whether central banks will have to cut rates more aggressively to combat a slowdown in the economy. In Switzerland, where UBS is headquartered, the central bank has cut rates twice this year. The European Central Bank and the Bank of England have both announced one cut so far.
“Knowing the events which are the unknowns on the horizon like the U.S. presidential election, we became complacent with a very low volatility, now we are shifting to a more normal regime,” Bruno Verstraete, founder of Lakefield Wealth Management told CNBC Wednesday.
“In the context of UBS, [more volatility is] not necessarily a bad thing, because more volatility means more trading income,” he added.
