Tesla’s double-digit plunge helped lead the CE 100 Index down yet again, slipping 2.1% in a week that saw all pillars, save one, retreat.
The Communications pillar was the sole gainer, adding 2.2%.
Snap shares added 8.8%.
As noted here, Snap, the parent company for Snapchat, rose on reports that its user base metrics would surpass Wall Street expectations.
Snap is projected to have over 475 million daily active users (DAUs) by 2024, ahead of consensus expectations of a base of 447 million individuals. Those estimates come courtesy of an internal memo, as has been reported, from CEO Evan Spiegel. Advertising revenues may also come in with growth rates around 20%, where the Street had been estimating 14% gains.
We noted, too, that Snapchat+ exceeded 5 million subscribers in September, up from 3 million in April. Snapchat+ has the potential to generate an estimated $240 million in annual revenue, with 5 million subscribers paying a $3.99 monthly fee.
The Move segment plummeted by 5.1%.
Tesla’s stock plummeted 15.6%. CNBC reported this past week that the shares slid on the company’s latest results and CEO Elon Musk’s “pessimism” on macroeconomic trends. As reported in the company’s earnings materials, Tesla’s revenues were up 9% to about $23.3 billion, but net cash provided from operating activities and net profits were down year over year.
On the conference call with analysts, Musk noted economic pressures and said the company would look to cut costs — and prices, too. He noted on the call that while demand for the company’s Cybertruck is strong, “we dug our own grave with Cybertruck,” adding that “we have to make it, and we need to make it a price that people can afford, insanely difficult things.” High-interest rates, he said, with a nod towards the economy, will make it “that much harder for people to buy the car. They simply cannot afford it.”
Elsewhere in the Move segment, Booking Holdings slid 6.6% and Airbnb was off 6.1%.
In reference to the latter name, reports came this week that Canada may be taking steps to regulate the short-term rental market, reducing the number of rentals overall, and in effect limiting the supply of Airbnb rentals there.
Separately, Netflix shares leaped 12.7%, blunting at least some of the decline in the “Have Fun” segment, which on the whole was off by 0.4%.
During the company’s latest earnings results, Co-CEO Greg Peters said, “We believe that we can build games into a strong content category, leveraging our current core film and series by connecting members, especially members that are fans of specific IPs, with games that they will love.” The latest quarterly data show that Netflix outperformed expectations, recording $8.5 billion in revenue, gaining 9 million paid subscribers, and achieving a robust 22.4% operating margin.
Netflix’s advertising plan continues to witness growing adoption, with a nearly 70% increase in ads plan memberships quarter-over-quarter. Additionally, an average of 30% of new sign-ups in regions with ads plans opt for this offering.
The company, we reported, in the wake of the third quarter report, acknowledges that there is still work to be done to further expand this aspect of their business. Their $6.99 per month ads plan in the United States remains instrumental in supporting the growth of their ads plan service.
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