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Markets Close in Red, but Well Off Lows; LYFT, RIVN, TWLO Report
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Market indices closed near session highs this afternoon, digging out from a mid-morning plummet of more than -1% across the board. Following Fitch’s downgrade of U.S. credit over the weekend, Moody’s issued warnings regarding 10 smaller institutions, which may lead to lower credit ratings and helped trip up market momentum this morning. But the S&P 500 closed back almost exactly to 4500: -0.38% on the day, the Dow slipped -145 points, -0.41%, the Nasdaq was -103 points, -0.74%, and the Russell 2000 wound up -0.58% for the session.
Also this morning, Wholesale Inventories for June came in lower than expected, both on headline and in the rearview mirror. A drop of -0.5% for the month was 20 basis points (bps) below the -0.3% analysts were expecting, while the May read of 0.0% initially reported was downwardly revised to -0.4% this morning. This may have a negative effect on Q2 GDP, as the month of June represents the final month of that quarter. Then again, inventory growth is really the least-good type of GDP growth, so we won’t lose any sleep over these figures.
Rivian (RIVN - Free Report) shares came in ahead of expectations on both top and bottom lines after the closing bell this afternoon, with negative earnings of -$1.08 per share improved from -$1.41 in the Zacks consensus. Revenues of $1.12 billion easily surpassed the $979 million analysts had expected. Delivery guidance for the full year was ramped up to 52K from an earlier guide of 50K, while capital expenditure guidance is now is expected to come down to $1.7 billion from $2 billion previously stated. Gross margins were still negative at -37%, but this is a huge improvement from -193% a year ago.
Lyft (LYFT - Free Report) shares got a big “lift” initially in today’s after-market following its big beat on its fiscal Q3 bottom line: earnings of +$0.16 per share was a clear improvement over the -$0.01 expected, and even cleared the year-ago result of +$0.12 per share. Active Rider numbers came in their highest in three years to 21.5 million, over 21.1 million anticipated, although Average Revenue per Active Rider was $47.57 versus $48.80 expected. Lyft shares had shot up +13% on the news, but have come back down to break-even at this hour.
Communications tech firm Twilio (TWLO - Free Report) , on the other hand, blew away estimates on both top and bottom lines in its Q2 report after regular trading ended today: earnings of 54 cents per share zoomed past the 29 cents we had expected. Similar to Rivian, revenues in the quarter finished above expectations of below $1 billion to $1.04 billion. The initial response after the release was for a big drop on lowered revenue guidance for Q3, but the big earnings beat looks to have now won out; shares are +7% since the close at this hour.
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Markets Close in Red, but Well Off Lows; LYFT, RIVN, TWLO Report
Market indices closed near session highs this afternoon, digging out from a mid-morning plummet of more than -1% across the board. Following Fitch’s downgrade of U.S. credit over the weekend, Moody’s issued warnings regarding 10 smaller institutions, which may lead to lower credit ratings and helped trip up market momentum this morning. But the S&P 500 closed back almost exactly to 4500: -0.38% on the day, the Dow slipped -145 points, -0.41%, the Nasdaq was -103 points, -0.74%, and the Russell 2000 wound up -0.58% for the session.
Also this morning, Wholesale Inventories for June came in lower than expected, both on headline and in the rearview mirror. A drop of -0.5% for the month was 20 basis points (bps) below the -0.3% analysts were expecting, while the May read of 0.0% initially reported was downwardly revised to -0.4% this morning. This may have a negative effect on Q2 GDP, as the month of June represents the final month of that quarter. Then again, inventory growth is really the least-good type of GDP growth, so we won’t lose any sleep over these figures.
Rivian (RIVN - Free Report) shares came in ahead of expectations on both top and bottom lines after the closing bell this afternoon, with negative earnings of -$1.08 per share improved from -$1.41 in the Zacks consensus. Revenues of $1.12 billion easily surpassed the $979 million analysts had expected. Delivery guidance for the full year was ramped up to 52K from an earlier guide of 50K, while capital expenditure guidance is now is expected to come down to $1.7 billion from $2 billion previously stated. Gross margins were still negative at -37%, but this is a huge improvement from -193% a year ago.
Lyft (LYFT - Free Report) shares got a big “lift” initially in today’s after-market following its big beat on its fiscal Q3 bottom line: earnings of +$0.16 per share was a clear improvement over the -$0.01 expected, and even cleared the year-ago result of +$0.12 per share. Active Rider numbers came in their highest in three years to 21.5 million, over 21.1 million anticipated, although Average Revenue per Active Rider was $47.57 versus $48.80 expected. Lyft shares had shot up +13% on the news, but have come back down to break-even at this hour.
Communications tech firm Twilio (TWLO - Free Report) , on the other hand, blew away estimates on both top and bottom lines in its Q2 report after regular trading ended today: earnings of 54 cents per share zoomed past the 29 cents we had expected. Similar to Rivian, revenues in the quarter finished above expectations of below $1 billion to $1.04 billion. The initial response after the release was for a big drop on lowered revenue guidance for Q3, but the big earnings beat looks to have now won out; shares are +7% since the close at this hour.
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