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VinFast Auto Ltd. late Thursday reported a second-quarter loss of half a billion dollars, saying it delivered more than 9,000 electric vehicles globally for sales of about $315 million in the period.
Vietnamese EV maker VinFast VFS went public in August through a SPAC deal, and the stock more than tripled by the end of its first session, sending the company’s market valuation soaring to more than $200 billion.
VinFast’s…
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Ford Motor Co.’s and General Motors Co.’s stocks were higher Friday as workers kicked off a strike, but their bonds have been under selling pressure for some time.
Nearly 13,000 U.S. auto workers went on strike early Friday after the three automakers and the UAW failed to reach an agreement before their national contract expired just before midnight.
The union has opted for targeted strikes, so workers at a Ford
F,
plant in Michigan and a GM
GM,
plant in Missouri were first to down tools, along with workers at a Stellantis N.V.
STLA,
plant in Ohio.
UAW President Shawn Fain has said others could join later and asked all 150,000 members to be ready if and when they’re called to strike.
The strike at all three U.S. carmakers is a break with tradition, as the union for many years has elected to center strike efforts at one company to protect its strike fund and picket-line firepower.
For more, read: UAW strike: 12,700 Ford, GM and Stellantis auto workers walk off the job
Ford’s stock was last up 0.5%, while GM was up 1.4%.
But as the following charts from data solutions company BondCliQ Media Services shows, the bonds have seen far more selling than buying over the last 10 days. Bondholders are often viewed as “smarter” than shareholders, because they tend to be laser-focused on a company’s financials and cash flows, to ensure they will be repaid their principal when bonds mature.
The next chart shows that Ford has seen more selling than GM.
Stellantis, meanwhile, was seeing strong buying of its U.S. dollar-denominated bonds. The company, the former Fiat Chrysler, has far less debt than Ford and GM.
Stellantis has about $26.5 billion of total debt, according to FactSet data, about $19.7 billion of which is in bonds.
Ford has $143 billion of debt and $124 billion of bonds. GM has $118 billion of debt, with about $107 billion in bonds, according to FactSet.
Fitch Ratings said earlier Friday the strike will have a limited financial impact on the auto makers, at least for now with just three plants striking.
“It seems likely the UAW will try to ratchet up pressure on the automakers over time by shifting the strike to more impactful plants and adding more plants to the strike,” Stephen Brown, a senior director at Fitch, said in emailed comments. “The impact on the automakers of striking individual plants could be similar to the semiconductor-induced disruptions that we saw over the past few years.”
See also: Big Three need to step up for the automotive workers who keep them profitable
Fitch had already incorporated the potential impact of strikes in its recent decision to upgrade its ratings of Ford and GM, he said. The agency moved Ford to BBB- from BB+, moving it back into investment trade from speculative, or “junk,” status.
“Ford, GM and Stellantis all have robust liquidity positions that will help them to withstand a potentially drawn-out period of production disruption. Based on June 30 figures, we estimate Ford has over $50 billion of cash and credit facility capacity, while GM has nearly $40 billion,” said Brown.
Stellantis stock was up 2.2% Friday and has gained 36% in the year to date, outperforming GM’s 1.2% gain and Ford’s 9.0% gain. The S&P 500
SPX
has gained 17% in the same time frame.
For live coverage of the UAW strikes, click here.
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The U.S. stock market, as measured by the S&P 500 Index SPX, is trapped in a trading range, and volatility seems to be damping down considerably. The significant edges of the trading range are support at 4330 and resistance at 4540. Both of those levels were touched in the latter half of August. A breakout from this range should give the market some strong directional momentum.
Since Labor Day, prices have hunkered down into an even narrower range. Typically, the latter half of September through the early part of October…
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By Ian Walker
Smurfit Kappa Group and WestRock Co. have formally signed a merger agreement as first outlined last week, creating a global paper and packaging powerhouse worth some $20 billion.
As announced on Sept. 7 a new company–Smurfit WestRock–will be created with a main listing on the New York Stock Exchange and a standard listing in London.
Smurfit WestRock will be led by Tony Smurfit as chief executive and Irial Finan as chair, the companies said.
Under the deal accepting WestRock shareholders will get one new Smurfit WestRock share and $5.00 in cash, equivalent to $43.51 a share.
Upon completion Smurfit Kappa shareholders will own 50.4% of the combined business with WestRock owning the rest.
“Smurfit WestRock will be the ‘Go-To’ packaging partner of choice for customers, employees and shareholders. We will have the leading assets, a unique global footprint in both paper and corrugated, a superb consumer and specialty packaging business, significant synergies, and enhanced scale to deliver value in the short, medium and long term,” Smurfit Kappa Chief Executive Tony Smurfit said.
Write to Ian Walker at ian.walker@wsj.com
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Usually, the announcement of a CEO change at a struggling company brings optimism and maybe even a stock pop. Not for
Walgreens Boots Alliance
Its shares have tumbled since Rosalind Brewer announced on Sept. 1 that she was stepping down. That could present a buying opportunity if the company makes the “right” choice…
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Apple Inc. shares sold off for the second session in a row Thursday amid swirling concerns about the company’s China business, but some analysts say those fears may be overblown.
The Wall Street Journal reported earlier this week that China was banning government officials from using iPhones for work purposes, while Bloomberg News reported that the ban could ultimately extend to government-backed agencies and state companies. The question for investors is whether the issue will be limited to state-affiliated employees in…
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Electric-vehicle startup VinFast Auto Ltd. has seen its market capitalization fall more than $140 billion in less than two weeks, weighed down by a six-day losing streak for the company’s stock.
Shares of VinFast
VFS,
soared last month after the company went public through a special-purpose acquisition company deal, taking its market cap to an eye-watering $231.3 billion on Aug. 25 — easily surpassing established automakers such as Ford Motor Co.
F,
and General Motors Co.
GM,
VinFast is on pace to extend its losing streak to seven days. Shares of the low-float company fell 26.3% Thursday, taking VinFast’s market cap to $85 billion, according to FactSet data. Ford’s market cap is $47.7 billion and GM’s is $44.5 billion, FactSet data show.
Related: This EV company has a bigger market cap than Ford or GM. But you may not have heard of it.
The EV maker is a majority-owned affiliate of Vietnamese conglomerate Vingroup, one of the largest publicly traded companies in Vietnam. VinFast said that as of June 30, 2023, the company has delivered close to 19,000 EVs.
About 99% of VinFast shares are controlled by Vingroup chair and VinFast founder Pham Nhat Vuon, making only a small portion available to investors.
Related: EV startup VinFast may be worth more than Ford or GM, but there’s a catch
VinFast is importing its vehicles into the U.S. and is also ramping up its North American presence. In July, the company broke ground on an electric-vehicle manufacturing site within the Triangle Innovation Point in Chatham County, N.C. The startup says the plant will eventually have the capacity to make 150,000 vehicles a year.
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The U.S.-listed shares of Manchester United PLC suffered a record beating Tuesday, after a report that the iconic English football club was set to be taken off the market.
Manchester United MANU UK:MNL fell 18.2% on the day to log its biggest one-day selloff since the company went public in August 2012. The previous record drop was 13.8% on March 12, 2020, at the outset of the coronavirus pandemic.
The…
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By Maitane Sardon
Pernod Ricard plans to buy back up to EUR800 million ($874 million) in shares in fiscal 2024 after the company reported an increase in sales and profit for fiscal 2023.
The French drinks group said Thursday that organic sales for the year ended June 30 grew 13% on a reported basis to EUR12.14 billion, while net profit for the year rose to EUR2.28 billion from EUR2.03 billion in fiscal 2022.
Analysts had expected sales of EUR12.16 billion and net profit of EUR2.4 billion, according to a FactSet-compiled poll.
For the fourth quarter, sales rose to EUR2.63 billion from EUR2.30 billion a year earlier.
The company said sales in all regions increased thanks to pricing, with all spirits categories delivering strong growth.
Looking ahead, the company backed its fiscal 2023-25 medium-term financial target, including reaching the upper end of between 4% and 7% of net sales growth and a 50 to 60-basis-point increase in operating margin.
It proposed a dividend of EUR4.70, an increase of 14% compared with fiscal year 2022.
Write to Maitane Sardon at maitane.sardon@wsj.com
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Johnson & Johnson
on Wednesday issued new financial guidance after spinning out the consumer-health company
Kenvue
While its earnings and sales projections were lowered on an absolute basis, the company is maintaining its dividend and expects to increase its revenue at a faster pace.
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Nvidia Plans to Buy Back Billions in Stock. Other Companies Could Join in Soon.
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Beer giant Heineken N.V. is the latest Western company to exit Russia, announcing Friday the sale of its Russian operations to Arnest Group for one euro.
Under the terms of the deal, all of Heineken’s
HEIA,
remaining assets, including seven breweries in Russia, will transfer to the new owners, the beer giant said in a statement. The Russian Arnest Group has also taken over responsibility for Heineken’s 1,800 employees in Russia.
Heineken began the process of exiting Russia in March 2022, following that country’s invasion of Ukraine. The company said it expects to incur a total cumulative loss of €300 million ($324.1 million) as a result of its exit.
“We have now completed our exit from Russia. Recent developments demonstrate the significant challenges faced by large manufacturing companies in exiting Russia,” Heineken CEO Dolf van den Brink said in a statement. “While it took much longer than we had hoped, this transaction secures the livelihoods of our employees and allows us to exit the country in a responsible manner.”
A number of major Western corporations, including U.S. giants Apple Inc.
AAPL,
Alphabet Inc.
GOOGL,
GOOG,
Amazon.com Inc.
AMZN,
International Business Machines Corp.
IBM,
and McDonald’s Corp.
MCD,
have left Russia in response to Moscow’s February 2022 invasion of Ukraine.
Earlier this week, DP Eurasia, the master franchiser of the Domino’s Pizza Inc.
DPZ,
brand in Turkey, Russia, Azerbaijan and Georgia, also announced its exit from Russia.
But Heineken is “no hero,” according to Mark Dixon, the founder of the Moral Rating Agency, an organization set up after the invasion of Ukraine to examine whether companies were carrying out their promises of exiting Russia. “It failed to leave Russia for a year and a half,” he told MarketWatch via email. “The explanation that it took longer than expected doesn’t hold water, because of course it’s difficult to find a buyer if you remain so long a pariah state.”
The Ukraine Solidarity Project said that Heineken’s move should increase the pressure on companies that remain in Russia, such as consumer-goods giant Unilever PLC
ULVR,
“The point here is that major companies, like @Heineken, are and have taken loses of hundreds of millions and billions in leaving the Russian market. It is possible,” the Ukraine Solidarity Project tweeted Friday. “We’re sure @Unilever can do it, too.”
Related: WeWork, Carl’s Jr., Unilever and Shell among companies slammed by Yale over operations in Russia
The Ukraine Solidarity Project recently launched a high-profile campaign urging Unilever to get out of Russia, using images of Ukrainian veterans injured in the war with Russia. Last month, activists from the Ukraine Solidarity Project held up a giant poster featuring the veterans outside Unilever’s London headquarters.
The Moral Rating Agency has also reiterated its calls for Unilever to end its Russian operations.
“We have always said we would keep our position in Russia under close review,” a Unilever spokesperson told MarketWatch earlier this month. The spokesperson also directed MarketWatch to a statement on the war in Ukraine that the company released in February 2023.
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Shares of electric-vehicle startup VinFast Auto Ltd. have surged since the company went public through a special-purpose acquisition company deal last week, taking its market capitalization to levels well beyond established automakers such as Ford Motor Co. and General Motors Co.
Shares of low-float company VinFast
VFS,
rose 16.1% Friday, after ending Thursday’s session up 32.3%, sending the company’s market cap to $231.3 billion. In comparison, Ford’s
F,
market cap is $47 billion and GM’s
GM,
is $45.2 billion, according to FactSet data. Rival EV maker Rivian Automotive Inc.
RIVN,
has a market cap of $18.6 billion. However, all of these are dwarfed by Tesla Inc.’s
TSLA,
$730.2 billion market cap.
In roughly a week, the VinFast stream on Stocktwits, a social platform for investors and traders, has racked up about 3,000 watchers, and message volume is “pretty consistent” throughout the day, Tommy Tranfo, Stocktwits’ head of community, and Tom Bruni, a senior writer for the platform, told MarketWatch Thursday.
Related: EV startup VinFast may be worth more than Ford or GM, but there’s a catch
“What everyone is discussing is whether or not the current hype in the stock is warranted given where the business is,” Tranfo and Bruni said in a statement emailed to MarketWatch Thursday, noting the company’s soaring market cap. “That’s despite the underlying business doing less than $1 billion in revenue, having negative cash flow from operations of $1.5 to $2 billion.”
In the short term, the stock is trading on momentum and hype, according to Tranfo and Bruni. “But eventually, its business results have to justify the valuation. And as we’ve seen with other startups in the space, it’s easy to say they’re going to accomplish XYZ, but harder to actually execute and produce results,” they said.
“From the community side: [We] think what we’re paying attention to the most right now is if this hype sticks,” they added.
The EV maker is a majority-owned affiliate of Vietnamese conglomerate Vingroup, one of the largest publicly traded companies in Vietnam. VinFast said that as of June 30, 2023, the company has delivered close to 19,000 EVs.
About 99% of VinFast’s shares are controlled by Vingroup chair and VinFast founder Pham Nhat Vuon, making only a small portion available to investors.
Stocktwits’ Tranfo and Bruni noted that EVs have a good track record of growing strong retail community support. “So there is reason to believe that this momentum could continue, but it may be too early to tell for sure,” they added. “Retail loves the electric-vehicle industry, so the interest is likely to continue regardless of how well the company (and stock) actually perform.”
Related: Tesla’s stock jumps 7% after Baird highlights Cybertruck, other ‘catalysts’ for the year
VinFast is importing its vehicles into the U.S. and is also ramping up its North American presence. In July, the company broke ground on an electric-vehicle manufacturing site within the Triangle Innovation Point in Chatham County, N.C. The EV startup says the plant will eventually have the capacity to make 150,000 EVs a year.
Claudia Assis contributed.
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UPS employees approved a new five-year union contract with the delivery giant Tuesday, about a month after reaching a tentative deal that averted a strike of 340,000 United Parcel Services workers.
The Teamsters said 86.3% of members voted for the “historic” deal, saying it was “the highest vote for a contract in the history of the Teamsters at UPS.”
UPS,
“Teamsters have set a new standard and raised the bar for pay, benefits and working conditions in the package-delivery industry,” Teamsters General President Sean O’Brien said in a statement. “This is the template for how workers should be paid and protected nationwide, and nonunion companies like Amazon
AMZN,
better pay attention.”
Among the parts of the contract the union highlighted were $2.75-an-hour raises for existing full- and part-time union members this year, and a total of a $7.50-an-hour raise over five years. All existing part-timers will earn at least $21 an hour starting immediately per the contract, according to the Teamsters.
The union also noted that the pay increases for full-timers will keep UPS Teamsters as the highest-paid delivery drivers in the country, with the average top rate rising to $49 an hour. In addition, the Teamsters said the new contract ends what it called the two-tier wage system at the company, with all UPS Teamster drivers currently classified as “22.4s” — or hybrid drivers and warehouse workers who were paid less than full-time drivers — to be reclassified immediately as RPCDs, or regular package car drivers.
A UPS spokesperson sent the following statement from the company: “Our Teamsters-represented employees have voted to overwhelmingly ratify a new five-year National Master Agreement that covers more than 300,000 full- and part-time UPS employees in the U.S.”
Amazon did not immediately respond to a request for comment.
One local supplemental agreement that affects 174 workers in Florida will be renegotiated, the union said. The national master agreement will go into effect as soon as that supplement, which is one of 44 local supplements, has been renegotiated and ratified, the union said.
See: UPS blames ‘late and loud’ Teamsters talks for revenue miss, outlook cut
Also: Actors, writers, hotel housekeepers and grad-student workers are all striking for the same reason
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As President Biden begins to more forcefully build a reelection case citing Bidenomics, Wall Street forecasts and actual GDP data are supportive, as are recent improving sentiment scores from consumers and CEOs. But on Main Street, small business owners remain a difficult group for Biden to win over.
Small business confidence is back at an all-time low, according to the just-released CNBC|SurveyMonkey Small Business Survey for the third quarter. That’s nothing new for Biden, as small business confidence has hung around a low throughout his presidency. In fact, the latest decline in the confidence index to a score of 42 out of 100 matches the all-time low from exactly one year ago.
With a business owner demographic that skews conservative, the twin economic issues of inflation and rising interest rates have compounded the general concerns about a Democratic administration. But at a time when signs are pointing to progress in the fight against inflation and a potential though by no means certain end to Federal Reserve interest rate hikes, the Q3 data presents more specific — and potentially more troubling — concerns for the president.
Even with a resilient economy, with interest rates at a multi-decade high, the number of small business owners who say they can easily access the capital needed to operate their firms continues to decline, now at under half (48%) versus 53% last quarter. This should not come as a surprise, as higher interest rates make banks stricter when it comes to lending requirements, a dynamic that tends to disproportionately punish small businesses, and linger or even intensify the longer a higher rate environment persists. Even for businesses that can secure loans, double-digit percentage rates are a cash flow challenge.
Data released on Monday from small business trade group NFIB reported similar difficulty among business owners attempting to access capital, with over half (58%) who borrowed or tried to borrow reporting high interest rates as their biggest complaint, and 40% of owners saying interest rates were a significant issue in the ability to access capital.
The latest monthly report from alternative lending firm Biz2Credit from earlier this month shows small business loan approval percentages at banks with over $10 billion in assets at 13.3% in July, an approval rate that has been falling steadily and, pre-pandemic, had been as high as 28.3% in February 2020.
Rohit Arora, CEO of Biz2Credit, noted in a release on his firm’s data that as regulators raise capital requirements at some large banks in the years ahead, steps being taken today to prepare include more hesitancy to lend to smaller companies, since these loans can often range from five to seven years in term length.
Beyond recent concerns about the stability of regional banks, rating agencies say that even the largest Wall Street banks are on downgrade watch, not a situation in which banks are likely to be more accommodating to the capital needs of small firms, and in fact, the CNBC|SurveyMonkey data recorded a sharp drop in financial system confidence among business owners who work with large banks.
When it comes to accessing capital, small firms that hold accounts with large banks recorded the largest drop quarter-over-quarter, a 10% decline, from 59% saying it was easy for them to access business capital down to just 49% now. That was a much larger decline than among business owners who bank with a regional bank (down 2% quarter over quarter) and those who work with a community bank (down 4%). The largest group of small businesses (41%) conduct their business with large banks.
SurveyMonkey’s analysis of the data pointed to a gap between business owners who express confidence and a lack of confidence in banks that has widened from just 1 percentage point in Q2 (49% confident, 50% not confident) to 9 points now (45% confident, 54% not confident) this quarter.
“These data are a good reminder that the general economy for small business owners can often be very different from the economy that consumers on one side or large corporations on the other are experiencing,” said Laura Wronski, research science manager at SurveyMonkey.
The CNBC|SurveyMonkey Small Business Survey was conducted among over 2,000 small business owners across the U.S. between August 7-August 14.
While concerns across the economy about the banking crisis have lessened since the last quarter, that is not reflected in the conditions that small businesses are facing.
“Banking concerns have become even more top-of-mind for small business owners now, with their confidence in the U.S. banking system weakening and their ability to access needed capital hampered,” Wronski said.
The CNBC|SurveyMonkey quarterly confidence index includes a series of core sentiment indicators related to policy that contributed to the decline back to the all-time low, with more small business owners saying they expect immigration policy and tax policy to be a negative.
That’s notable, according to SurveyMonkey analysis of the results, with these index components that had the largest drag on the overall scores not those tied to hiring or economic conditions, but “two factors that fall squarely within the remit of the president and Congress.”
Business owner expectations for revenue and hiring were largely unchanged, and the percentage that describe economic conditions as “good” changed only slightly, from 40% to 38%. More describe conditions as “middling,” up from 43% to 46% this quarter. But only 15% describe business conditions as “bad.”
“Small business owners seem to be more heavily factoring the political environment into their confidence estimations than the economic environment. The economy has shown promising growth over the last quarter, with fewer concerns about a recession economy-wide now and less immediate threat from a banking crisis,” Wronski said.
In the confidence index scoring, rather than broader survey questions, there was a notable drop for Biden. According to SurveyMonkey, overall approval of the president now matches the same level as Q3 2022 survey, with 31% saying they approve and 68% saying they disapprove of the way Joe Biden is handling his job as president. The small business survey data matches the overall trend in the recent FiveThirtyEight polling average.
But Wronski said, “What’s really surprising is that general confidence among small business owners is falling now for the first time among Biden’s supporters.”
With the overall confidence index back at the all-time low of 42, the gap in confidence index scoring specifically between Biden’s supporters and his detractors is now a record-low 18 points, according to SurveyMonkey (55 versus 37). Among survey respondents who identify as Democrats, the quarterly confidence score declined from 58 to 52, the lowest it has been since Biden became president. Among independents, the decline was from 49 to 42, the lowest it has been among these respondents since the first quarter of 2021. Republican confidence moved the least, declining from a score of 39 to 37.
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Arm Holdings Ltd. filed its long-awaited initial public offering late Monday, following last year’s failed bid by Nvidia Corp. to acquire the U.K.-based chip architecture company.
Arm has reportedly been seeking to raise $8 billion to $10 billion at a valuation of $60 billion to $70 billion, making its IPO the biggest of the year so far, and a number of large tech companies, including Amazon.com Inc.
AMZN,
Intel Corp.
INTC,
and Nvidia
NVDA,
are reportedly in the mix to be anchor investors.
In a late Monday filing with the Securities and Exchange Commission, Arm said it was offering to list its U.S. traded shares on the Nasdaq under the ticker symbol “ARM.”
Arm, which is owned by Japan’s SoftBank Group Corp.
9984,
was the target of an unsuccessful $40 billion acquisition by Nvidia last year. After Nvidia scrubbed the deal and paid a $1.36 billion breakup charge following the U.S. Federal Trade Commission’s unanimous decision to block it, Nvidia disclosed it paid Arm $750 million for a 20-year license to its technology.
At the time of the breakup, chips sales had hit record highs in 2021, surging 26.2% to a record $555.9 billion, fueled by pandemic-triggered shortages. But the chip industry has since swung to a glut.
Arm listed Barclays, Goldman Sachs, JP Morgan, Mizuho, BofA Securities, Citigroup, and Deutsche Bank Securities among the IPO’s underwriters.
Recent reports said SoftBank was in discussions to purchase the 25% stake in Arm that it does not outright own, which is held by its Vision Fund 1, ahead of the IPO.
Read from Feb. 2022: Wall Street’s reaction to death of Nvidia-Arm deal: No duh
Arm reported net income of $524 million, or 51 cents a share, on revenue of $2.68 billion for fiscal 2023, which ended March 31, compared with net income of $549 million, or 54 cents a share, on revenue of $2.7 billion, in fiscal 2022, and $388 million, or 38 cents a share, on revenue of $2.03 billion in fiscal 2021.
Arm uses an architecture that is different from the once-standard x86 one built by Intel in the early days of computing.
The company said it has shipped more than 250 billion Arm-based chips since its started in 1990 as a joint venture between Acorn Computers, Apple
AAPL,
and VLSI Technology. In fiscal 2023, Arm said it shipped 30.6 billion chips.
The company said it is going public as the “resources required to develop leading-edge products are significant and continue to increase exponentially as manufacturing process nodes shrink.” Transistors are expressed in scales of nanometers, with design costs running about $249 million for a 7-nanometer chip and about $725 million for a 2-nm chip.
“As the world moves increasingly towards AI- and [machine language]-enabled computing, Arm will be central to this transition,” the company said in the filing. “Arm CPUs already run AI and ML workloads in billions of devices, including smartphones, cameras, digital TVs, cars and cloud data centers.”
Arm said it is working with Alphabet Inc.
GOOG,
GOOGL,
GM’s
GM,
Cruise, Mercedes-Benz
MBG,
Meta Platforms Inc.
META,
and Nvidia “to deploy Arm technology to run AI workloads.”
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This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com.
https://www.barrons.com/articles/u-s-steel-usw-right-bid-cliffs-89cbf208
The battle for
United States Steel
has already taken a number of unexpected twists and turns. Investors just got another one.
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By Adria Calatayud
Novartis said the planned spinoff of its Sandoz generic pharmaceuticals and biosimilars business is expected to occur on or around Oct. 4.
The Swiss pharmaceutical giant said Friday that the separation will take place through a proposed distribution of Sandoz shares to its existing shareholders. Novartis shareholders will get one Sandoz shares for every five Novartis shares held and one Sandoz American depositary receipts–or ADRs–for every five Novartis ADRs, the company said.
Novartis had previously said it expected the spinoff to happen early in the fourth quarter.
The Sandoz spinoff remains subject to approval by Novartis’s shareholders. Novartis has scheduled an extraordinary general meeting for Sept. 15 to vote on the proposed distribution of Sandoz shares and a reduction in its own share capital in connection with the spinoff, it said.
Following the separation, Sandoz would be listed in SIX Swiss Exchange, with an ADR program in the U.S., Novartis said.
Write to Adria Calatayud at adria.calatayud@dowjones.com
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Adyen shares fell as much as 22% on Thursday as the fast-growing Dutch payment company’s first-half results lagged estimates.
Adyen’s
ADYEN,
first-half profit was virtually flat at €282.2 million ($307 million), while net revenue rose 21% to €739.1 million, missing the consensus of €777 million.
Its earnings before interest, tax, depreciation and amortization fell 10% to €320 million, lagging the consensus of €379 million.
Adyen has previously lamented not being able to grow its team in North America, which it said is impacting now. “We now see the impact of a sales team size that did not match our ambitions, particularly in North America,” the company said in its shareholder letter. In the first half, it added 551 full-time employees, three-quarters in tech roles. The company blamed the adjusted profit decline on increased wages and salaries.
Inflation was a problem for its customers, too. “As a natural consequence of the shifting economic climate – driven by higher inflation and interest rates – profit outweighed growth for many North American digital businesses in the first half. Enterprise businesses prioritized cost optimization, while competition for digital volumes in the region provided savings over functionality,” the company said.
The company reiterated its longer-term revenue and margin goals, including for revenue growth between the mid-twenties and low-thirties. “We know that growth is not always linear, and reiterate our financial objectives,” the company said.
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