5 things to know before the stock market opens on Wednesday, January 31
European telecom companies say the major internet companies, most of them American, have built their businesses on the back of billions of dollars in investments in internet infrastructure.
Beata Zorzel | norphoto | Getty Images
It was good, but not good enough. Both Alphabet and Microsoft saw their shares sell off in extended trading on Tuesday despite reporting revenue and profits that beat expectations. Alphabet shares fell nearly 6% as the company reported disappointing advertising revenue of $65.52 billion, falling short of the $65.94 billion that StreetAccount analysts had expected. YouTube also came in below expectations, but Google Cloud was a bright spot, expanding 26% in the fourth quarter from a year ago. Meanwhile, Microsoft shares initially fell more than 2%, although they recovered some of those losses. Microsoft said in a statement that its revenues increased by 17.6% year-on-year, although its forecasts were somewhat mild. The Intelligent Cloud segment beat analysts’ expectations, and revenue from Azure and other cloud services grew by 30%.
A person walks past an unpainted Boeing 737-8 MAX parked at Renton Municipal Airport next to the Boeing factory in Renton, Washington on January 25, 2024.
Jason Redmond | AFP | Getty Images
Boeing announced a smaller-than-expected loss for the last three months of the year, but its future remains unknown. The company reported an adjusted loss per share of 47 cents versus the 78 cents loss analysts had expected. Demand for and deliveries of aircraft increased during the same period. But the report comes weeks after a door seal on a Boeing 737 Max 9 plane flying at 16,000 feet exploded, leaving a gaping hole in the side of the plane. The company did not provide a forecast for 2024. But investors are eager to hear from the planemaker about how the explosion will impact the industry as the incident is the subject of a federal investigation. “While we often use this time of year to share or update our financial and operational goals, now is not the time,” Boeing CEO Dave Calhoun said in a letter to employees.
A United Parcel Service delivery truck in San Francisco, California.
UPS cuts 12,000 jobs CEO Carol Toomey said the layoffs would save the shipping giant about $1 billion in costs and that 2023 was a “unique, frankly, difficult and disappointing year.” UPS shares fell more than 8% on Tuesday as the company missed Wall Street revenue estimates. UPS also reported a decline in international and domestic shipping volume, with Tommy citing weakness in Europe, as well as disruptions in the Red Sea region and the Panama and Suez Canals that contributed to the decline.
Tesla and SpaceX CEO Elon Musk reacts during a conversation with British Prime Minister Rishi Sunak in London on November 2, 2023.
Kirsty Wigglesworth | Reuters
A Delaware judge invalidated Elon Musk’s $56 billion Tesla compensation on Tuesday, agreeing with the plaintiff that Musk’s pay package was improperly set by the board of directors. The compensation plan awarded by Tesla to Musk in 2018 was unprecedented, and the judge noted it was the largest in the company’s public history. It also made Musk the richest person on the planet. But the court’s senior counsel, Kathleen McCormick, said in a 200-page ruling that Tesla had failed to show “that the compensation plan was fair” or provide much evidence that its members had negotiated with Musk. She said that the plaintiff in this case has the right to cancel. Tesla shares fell about 3% in after-hours trading after the decision was announced.
— CNBC’s Brian Evans, Ashley Cabot, Ari Levy, Jordan Novitt, Leslie Josephs, Laiya Neelakandan, Dan Mangan and Laura Kolodny contributed to this report.
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(Tags for translation) Investment Strategy