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Elon Musk employed an aggressive strategy—including the threat of a “thermonuclear” lawsuit— to contain the fallout after his endorsement of anti-Semitic rhetoric on X that prompted an advertising backlash at the billionaire’s social media company and some on Wall Street to call for his censure.
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Updated Nov. 20, 2023 6:34 am ET
SAN FRANCISCO—Microsoft said it is hiring Sam Altman to helm a new advanced artificial-intelligence research team, after his bid to return to OpenAI fell apart Sunday with the board that fired him declining to agree to the proposed terms of his reinstatement.
Microsoft Chief Executive Satya Nadella posted on X (formerly Twitter) late Sunday that Altman and Greg Brockman, OpenAI’s president and co-founder who resigned Friday in protest over Altman’s ouster, will lead its team alongside unspecified colleagues. Nadella said Microsoft was committed to its partnership with OpenAI and that it would move quickly to provide Altman and Brockman with “the resources needed for their success.”
Copyright ©2023 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
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Kyle Vogt resigned as chief executive of autonomous-vehicle company Cruise late Sunday, following the recent suspension of Cruise’s operations on public roads.
“Today I resigned from my position as CEO of Cruise,” Vogt, who co-founded Cruise and oversaw its 2016 acquisition by General Motors Co. GM, tweeted Sunday night. “The last 10 years have been amazing, and I’m grateful to everyone who helped Cruise along the way.”
He…
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U.S. stocks have jumped back near to their summertime highs, a big rebound as investors enter the holiday season with Black Friday just days away.
The shopping frenzy expected on Friday, the day after Thanksgiving, kicks off a spending spree for the holidays that could help buoy stocks after their surge this month.
“With consumers employed…
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Starbucks is losing its prime spot among chains racing to meet China’s growing thirst for coffee.
Luckin Coffee has surpassed Starbucks as China’s biggest coffee chain by sales and units, company reports show, a comeback for the Chinese company after an accounting scandal that stalled its growth.
Copyright ©2023 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
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Is this the beginning of the end for X, the social-media site previously known as Twitter?
In the last two days, major advertisers, ranging from IBM Corp. IBM, Apple Inc. AAPL, Lions Gate Entertainment Corp. LGF.A, Walt Disney Co. DIS, even the European Union, have pulled their ads from X, after Elon Musk appeared to endorse antisemitic conspiracy theories and because these big spenders weren’t thrilled with the algorithm’s product placement nestled alongside pro-Nazi posts.
Earlier…
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OpenAI announced Friday afternoon that CEO Sam Altman has departed the company, saying the executive “was not consistently candid in his communications with the board, hindering its ability to exercise its responsibilities.”
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Legendary short seller Jim Chanos told the Wall Street Journal Friday that he is closing his hedge funds, saying that “the marketplace for what I do has changed.” Chanos expects to return most of his investors’ cash by Dec. 31, the newspaper reported. The short seller famously detected issues with Enron Corp.’s filings two decades ago and earlier this year took on Tesla Inc. TSLA, but his funds had dwindled. Chanos & Co. manages less than $200 million currently, down from $6 billion in 2008, the Journal said. Chanos’s funds are down 4% so far this year, while the S&P 500 index SPX has gained more than 17%. Tesla is up…
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OpenAI said Friday that Sam Altman is no longer its chief executive, with the ChatGPT parent adding that said Altman had not been “consistently candid in his communications with the board.”
“The board no longer has confidence in his ability to continue leading OpenAI,” the company said in a blog post.
In a tweet Friday, Altman said he “will…
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If Donald Trump were to be elected president in 2024, what would it mean for U.S. tax policy and the national debt?
There are growing expectations that he could deliver another round of big tax cuts, with the reductions coming right as those enacted in 2017’s Tax Cut and Jobs Act are due to expire in 2025.
“If Republicans hold their House…
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IBM Corp.
IBM,
has abruptly pulled ads from X, formerly Twitter, amid a maelstrom of controversial comments from billionaire owner Elon Musk and the placement of IBM ads.
“IBM has zero tolerance for hate speech and discrimination and we have immediately suspended all advertising on X while we investigate this entirely unacceptable situation,” the company said in a statement emailed to MarketWatch.
IBM suspended advertising following a report by the Financial Times on Thursday that IBM ads appeared next to posts supporting Adolf Hitler and the Nazi Party. A Media Matters study also found ads from Apple Inc.
AAPL,
Oracle Corp.
ORCL,
and Comcast Corp.’s
CMCSA,
Xfinity and Bravo were adjacent to pro-Nazi content.
On Wednesday, Musk agreed with a post on X supportive of an antisemitic conspiracy theory that Jewish people hold a “dialectical hatred” of white people. “You have said the actual truth,” Musk wrote in response to the post.
Compounding matters, Musk on Thursday said on X it was “super messed up” that white people are not, in the words of one far-right user’s tweet, “allowed to be proud of their race.”
Adding fuel to the fire, Musk said on Wednesday that the Jewish advocacy group the Anti-Defamation League “unjustly attacks the majority of the West, despite the majority of the West supporting the Jewish people and Israel.” (Musk has threatened to sue the ADL because of its criticism of lax moderation practices on X that it says have allowed antisemitism to spread.)
The cascading conflagration prompted Tesla Inc.
TSLA,
bull and investment adviser Ross Gerber to grumble on X: “Getting a flood of messages from clients wanting out of tesla and anything to do with Elon Musk. Many saying they are selling their cars as well. What is he doing to the tesla brand??!!?!?”
Earlier this year, Gerber backed down from his “friendly activist” efforts to join Tesla’s board, saying he felt his concerns had been addressed. His firm, Gerber Kawasaki Wealth and Investment Management, has its own ETF, AdvisorShares Gerber Kawasaki
GK,
which has Tesla as its top investment, and has attracted many clients with Tesla shares in its portfolios
In an interview on CNBC late Thursday, Gerber said that while he is not selling his Tesla stock, ” I’m not going to mince words about it anymore as a shareholder. It’s absolutely outrageous, his behavior and the damage he’s caused to the brand.”
Gerber said Musk has essentially abdicated his responsibilities as Tesla CEO: “It’s all about Twitter, and what he can tweet, and how many people he can piss off… What’s going to happen to Tesla over the next 10 years, are they gonna achieve their mission if the CEO isn’t actually the CEO? Because he’s certainly not acting as the CEO of Tesla.”
An X executive told MarketWatch that the company did a “sweep” of the accounts next to the IBM ads. Those accounts “will no longer be monetizable” and specific posts will be labeled “Sensitive Media.”
The executive said 99% of measured ad placements on X this year have appeared adjacent to content scoring “above the brand safety floor” criteria set by industry standards.
Late Thursday, X’s chief executive, Linda Yaccarino, tweeted: “X’s point of view has always been very clear that discrimination by everyone should STOP across the board — I think that’s something we can and should all agree on. When it comes to this platform — X has also been extremely clear about our efforts to combat antisemitism and discrimination. There’s no place for it anywhere in the world — it’s ugly and wrong. Full stop.”
The posts and ad placement come amid a wave of antisemitism on digital forums including X and a downturn in advertising on the platform linked to hate speech and misinformation. Musk said in July that ad revenue had plunged about 50%.
The latest kerfuffle is likely to complicate the efforts of Yaccarino, who was hired in June from Comcast Corp.’s
CMCSA,
NBCUniversal to sway advertising agencies and major brands to stay on, or initiate relationships with, the platform now known as X.
Tesla shares fell nearly 4% on Thursday but are still up about 90% to date in 2023.
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Shareholders of Walmart Inc. may have had an inkling of today’s stock selloff if they had been watching the performance of its bonds over the last two weeks.
The bonds have seen net selling even as spreads have tightened, according to data solutions company BondCliQ Media Services.
The same is true for Costco Wholesale Corp.
COST,
as the company’s stock fell in sympathy with Walmart on Thursday. That was after Walmart
WMT,
Chief Executive Doug McMillon said he expects to see a U.S. deflation trend in the coming months.
McMillon was the first retail executive to raise the specter of deflation on an earnings call this season so far.
For more, read: Walmart’s stock on pace for largest daily percentage decline in over a year after earnings
The comment came after the retail giant posted better-than-expected third-quarter earnings, but offered per-share earnings guidance that was below consensus, sending the stock down more than 7%.
The following charts show what’s been happening with Walmart and Costco bonds in the run-up to today’s numbers.
Bondholders tend to be keenly focused on a company’s underlying financials and closely watched metrics such as cash flow to ensure it can cover interest payments.
That’s because, by buying corporate bonds, they are effectively lending money to a company for a set term and want to be sure they will get their full investment back once they mature. Shareholders tend to be more tuned into daily stock-price movements.
The following chart shows the two-week volume for the bonds by trade type.
The next chart focuses on two-week client flows, showing net selling for both issuers over the period.
The selling has come as spreads have been tightening, as the next chart illustrates.
Walmart’s numbers come after other retailers this week said they are seeing signs of pushback from their customers, especially when it comes to big-ticket items.
That was the message from Target Corp.
TGT,
on Wednesday, with that company’s sales number lagging consensus. Chief Executive Brian Cornell the company saw soft industry trends in discretionary categories, as well as higher inventory shrink.
See also: Target CEO says consumers are still spending, but sees pressure on discretionary items
On Tuesday, Home Depot Inc.
HD,
said its customers were avoiding big-ticket items.
“The third quarter was in line with our expectations – similar to the second quarter, we saw continued customer engagement with smaller projects and experienced pressure in certain big-ticket, discretionary categories,” said Home Depot CEO Ted Decker, during a conference call to discuss the results.
For more, see: Home Depot CEO says 2023 ‘a period of moderation’ in home improvement spending
Costco’s stock was down 2.5%, while Home Depot was down 0.7% and Target was down 0.2%.
The SPDR S&P Retail exchange-traded fund
XRT
was down 3% and has gained 2% in the year to date, while the S&P 500
SPX
has gained 17%.
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Walmart topped third-quarter estimates and raised fiscal-year guidance. But investors were expecting more from the world’s largest retailer, sending the stock lower in premarket trading.
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An earlier version of this article incorrectly said that Walmart’s stock has fallen this year. It has gained 20%. The article has been corrected.
Walmart Inc.’s stock tumbled 7.3% early Thursday, after the company offered guidance for 2023 that was below consensus, offsetting a profit and sales beat for the third quarter.
The Bentonville, Ark.-based retail giant
WMT,
posted net income of $453 million, or 17 cents a share, for the third quarter, after a loss of $1.8 billion, or 66 cents a share, in the year-earlier period.
Adjusted per-share earnings came to $1.53, ahead of the $1.52 FactSet consensus.
Revenue rose 5.2% to $160.8 billion from $152.8 billion, also ahead of the $159.7 billion FactSet consensus.
See also: Target CEO says consumers are still spending, but sees pressure on discretionary items
Walmart’s U.S. same-store sales rose 4.9%, while e-commerce sales rose 24%. Average transactions were up 3.4%, while the average ticket was up 1.5%.
Chief Executive Doug McMillion said the company saw revenue grow across segments and that it was getting an early start to the holiday season.
At the company’s international segment, growth in sales was led by Walmex and China. E-commerce sales fell 3%, while advertising grew 4%.
At Sam’s Club U.S., sales rose 2.8% to $22.0 billion from $21.4 billion a year ago, led by food and consumables, and healthcare. Same-store sales rose 3.8%, transactions were up 4% and average ticket was down 0.2%.
The company said it was raising its full-year guidance and now expects adjusted EPS of $6.40 to $6.48, but that was below the FactSet consensus of $6.50. It expects sales to grow 5% to 5.5%, while FactSet is expecting growth of 5%.
The stock has gained about 20% in the year to date, while the S&P 500
SPX,
has gained 17%.
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It’s filing season for a string of major hedge funds, and big tech names like Apple, Microsoft, and Nvidia were among the most-traded equities in the third quarter.
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By Adria Calatayud
Alstom plans to cut around 1,500 full-time equivalent positions and scrap its dividend as part of a cost-savings plan to reduce debt and boost profitability.
The French train maker said Wednesday that it is also considering equity and equity-like issuances, as well as a capital increase, among potential options to accelerate its debt-reduction plans.
Alstom’s measures are part of a plan that seeks to secure its mid-term profit and cash-generation targets and come after the company said last month that it burned cash in the six months to September.
The company also said it would overhaul its governance to improve accountability and financial discipline. Its board intends to propose former Safran Chief Executive Philippe Petitcolin as a director and then as chairman, separating the chair role from that of CEO. Henri Poupart-Lafarge will keep the CEO role, the company said.
Alstom said it is targeting a reduction of 2 billion euros ($2.18 billion) in its net debt by March 2025 and that it is considering a range of transactions to accelerate that effort. These include an asset-sale plan that has already been launched, with proceeds of up to EUR1 billion targeted, in addition to equity issues and a capital increase, it said.
As of March 2023, Alstom employed more than 80,000 people, according to its annual report.
Write to Adria Calatayud at adria.calatayud@dowjones.com
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Soros Fund Management, the investment firm founded by billionaire George Soros, took new positions or bulked up on IPOs and a number of tech names during the third quarter.
But it sold off small holdings of some of the largest — like Nvidia Corp. and Microsoft Corp. — as well as electric-vehicle maker Rivian Automotive.
According to a filing on Tuesday, the firm during the third quarter bought up 325,000 shares of chip designer Arm Holdings
ARM,
which went public in September, for $17.4 million. It also bought smaller stakes in recent IPOs such as Maplebear Inc.
CART,
better known as grocery-delivery platform Instacart, and digital-marketing firm Klaviyo Inc.
KVYO,
Those purchases were disclosed as investors remain cautious on new IPOs.
Elsewhere, the fund took a new position, of around 41,000 shares, in Apple Inc.
AAPL,
And it did so as well for Datadog Inc.
DDOG,
buying 62,000 shares during the quarter. It also bought up 574,962 shares of Splunk, and took fresh positions in Snowflake Inc.
SNOW,
and Taiwan Semiconductor
TSM,
Soros also packed on more to some of its other tech holdings. It added 125,000 shares to its stake in Uber Technologies Inc.
UBER,
boosting its position by 16.6% for a total of 878,955 shares. It also bought 42,000 more shares of another gig-economy player, DoorDash Inc.
DASH,
a 30.9% increase for 178,075 shares.
While Soros boosted its stake in General Motors
GM,
it sold off its 4.2 million shares in Rivian
RIVN,
The firm also sold off its positions — of roughly 10,000 shares apiece — in tech giants Microsoft
MSFT,
and Nvidia
NVDA,
Soros Fund Management also sold off its stake in Walt Disney Co.
DIS,
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Shares of Canadian Solar were falling sharply after the company fell short on quarterly earnings and sales.
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By Najat Kantouar
Vodafone Group has reiterated its full-year guidance as it reported a much lower pretax profit for the first half of fiscal 2024, reflecting adverse foreign-exchange rate movements and business disposals in the prior year.
The U.K. telecommunications company said Tuesday that it expects to report underlying earnings before interest, taxes, depreciation, amortization and lease expenses of 13.3 billion euros ($14.23 billion) for the year ending March 31 compared with EUR14.7 billion in fiscal 2023. Adjusted free cash is seen at around EUR3.3 billion, from EUR4.84 billion.
Pretax profit for the six months ended Sept. 30 was EUR550 million compared with EUR1.69 billion for the same period a year earlier.
Adjusted earnings before interest, taxes, depreciation, amortization and lease expenses–which strips out exceptional and other one-off items–was EUR6.39 billion compared with EUR7.24 billion with organic growth of 0.3% despite a significant increase in energy costs.
Adjusted free cash outflow widened to EUR1.47 billion from EUR513 million, reflecting a fall in adjusted Ebitda after leases in the period, together with lower dividends from associates and joint ventures.
Group revenue fell to EUR21.94 billion from EUR22.93 billion despite service revenue growth in both Europe, excluding Turkey, and Africa by 1.5% and 9.0%, respectively.
The board declared an interim dividend of 4.50 European cents for the period, flat on year.
“During the first half of the year, we have delivered improved revenue growth in nearly all of our markets and have returned to growth in Germany in the second quarter. We have also announced transactions to strengthen our position in the U.K. and exit the challenging Spanish market in order to right-size our portfolio for growth.” Chief Executive Officer Margherita Della Valle said.
Write to Najat Kantouar at najat.kantouar@wsj.com
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Fisker Inc. shares plunged around 10% in the after-hours session Monday after the electric-vehicle maker widened its quarterly loss and reported sales that missed the mark, underscoring the difficulties of turning a profit in the EV world.
Fisker
FSR,
lost $91 million, or 27 cents a share, in the third quarter, compared with a loss of $149.3 million, or 49 cents a share, in the year-ago period.
Revenue rose to $71.8 million, from $14,000 a year ago and $825,000 in the second quarter.
Analysts polled by FactSet expected Fisker to report a loss of 23 cents a share on sales of $143.1 million.
Fisker kept its guidance for 2023 operating expenses and capital expenditures unchanged, between $565 million and $640 million, but removed language about gross margins.
See also: Tesla’s Cybertruck contract restricts reselling vehicle within the first year
In August, the company said it expected gross margins between 8% and 12% for the year, “provided input costs do not change dramatically.”
The EV maker said the third quarter was its first quarter “with meaningful automotive sales revenue.”
Fisker is often dubbed the “Apple of autos,” and is focused on design and consumer interfaces while contracting out the manufacturing of cars.
The company said it produced 4,725 vehicles and sold 1,097 in the quarter. Deliveries “have accelerated as Fisker begins optimizing last-mile logistics and expanding its delivery infrastructure to achieve further scale effects in Q4 and beyond,” the company said in a statement.
“Over 3,000 vehicles delivered globally to date and hundreds more en route to consumers,” the company said.
On Monday, Fisker said it lowered its Fisker Ocean prices in the U.S. for the first time since it introduced the trim pricing in 2020 and 2021. Fisker also adjusted pricing in Europe and Canada, narrowing the gap between two trims.
Don’t miss: Plug Power’s stock extends losses as investors seek ‘clarity’ about going-concern warning
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