Stocks Fall as Salesforce Sparks Tech Selloff

Stock Index Summary: Salesforce Sparks Tech Selloff; Apparel, retail stocks surge amid strong earnings

13 hours 12 minutes ago

Prov

Verizon (VZ) rose 3.1% after signing a 10-year contract for the U.S. Navy worth more than $2.6 billion.

Nike (NKE) rose 2%, likely on better-than-expected results from shoe retailer Foot Locker (FL) and sandal maker Birkenstock (BIRK).

Salesforce (CRM) fell 19.7% as analysts lowered price targets for the company’s stock after the company reported its first decline in quarterly revenue since 2006.

Tech giants Microsoft (MSFT) and Amazon (AMZN) followed Salesforce’s lead, falling 3.4% and 1.5%, respectively, amid a relatively widespread tech sell-off.

S&P500

HP Inc ( HPQ ) rose 17% after its quarterly earnings report fueled optimism that demand for artificial intelligence PCs could boost future sales.

Best Buy (BBY) rose 13.4% after beating first-quarter earnings estimates.

TJX Companies (TJX) rose 1.9% after discount retailer Burlington Stores (BURL) reported better-than-expected quarterly results thanks to a surge in demand.

ServiceNow (NOW) fell 12.1% on disappointing sales and Salesforce guidance. Software stocks fell on Thursday, with Adobe (ADBE) losing 6.6% and Oracle (ORCL) falling 5.4%.

Intuit (INTU) fell 5.9% as the IRS said it would make its free Direct File program permanent and expand access to more taxpayers.

Nvidia (NVDA) fell 3.8% on reports that U.S. officials slowed licensing of advanced chipmakers sending supplies to the Middle East. Fellow chipmakers Broadcom (AVGO) and Qualcomm (QCOM) lost 1.9% and 1.3%, respectively.

Nasdaq 100

Tesla ( TSLA ) was one of only two companies in the Magnificent Seven to avoid Thursday’s sell-off. It gained 1.5% after the company attacked proxy advisory firm Glass Lewis for urging shareholders to reject CEO Elon Musk’s proposed compensation package. Shares of Apple (AAPL), also owned by Mag Seven, rose 0.5%.

Cybersecurity stocks trailed technology stocks. Crowdstrike (CRWD) fell 9.6%, while Palo Alto Networks (PANW) and Fortinet (FTNT) lost 4.5% and 2.9%, respectively.

Birkenstock hits record high as demand surges

13 hours 53 minutes ago

Shares of Birkenstock Holding Plc (BIRK) hit an all-time high on Thursday as the fashion footwear maker reported record second-quarter revenue and improved its outlook amid strong demand across its segments.

The company known for its health-promoting sandals reported quarterly revenue growth of 22% to 481.2 million euros ($521.7 million), with adjusted earnings per share (EPS) of 0.41 euros ($0.44). Both were clearly above forecasts.

Sales increased 21% in the Americas and Europe and 42% in the Asia Pacific Middle East and Africa (APMA) region.

Chief Executive Officer (CEO) Oliver Reichert noted that demand for Birkenstock shoes continues to exceed supply across all segments, channels and categories. Reichert said that due to its second-quarter results, Birkenstock is raising its outlook for full-year revenue growth to 20% in constant currency, compared with its previous forecast of 17% to 18% higher.

Shares of Birkenstock, which debuted last October on the New York Stock Exchange (NYSE), rose 11% to above $55 on Thursday afternoon. They have gained approximately 14% since the beginning of the year.

–Bill McCol

HP stock jumps on solid earnings and optimism for AI-powered computers

15 hours 10 minutes ago

HP Inc. Shares (HPQ) rallied on Thursday, a day after the company reported solid earnings and signaled it could continue to benefit from the artificial intelligence (AI) boom.

HP reported fiscal second quarter 2024 total revenue of $12.8 billion, according to estimates compiled by Visible Alpha, down slightly from last year’s $12.91 billion but better than analyst expectations $12.59 billion.

Net income of $607 million, or 61 cents per share, missed estimates of $678.9 million, or 69 cents per share, due to just over $200 million in one-time charges. After eliminating charges, HP’s adjusted earnings of $812 million, or 82 cents per share, beat estimates of $803.5 million, or 81 cents per share.

HP’s share price has already been impacted by AI optimism, with CEO Enrique Lores stating in previous quarters that while it will take time for the company to widely adopt new products such as AI PCs, the new technology could significantly impact growth growth in 2025 and beyond.

HP shares jumped more than 17% on Thursday to above $38, their highest level in two years.

-Aaron McDade

S&P 500, Dow Creep Up After Data Crash

16 hours 8 minutes ago

The S&P 500 and Dow rallied on Thursday after a data crash left index watchers partially blinded for more than an hour.

The data dissemination disruption caused price data for the S&P 500 and Dow Jones Industrial Average to stop abruptly around 10:40 a.m. Thursday. Data publication was resumed around noon, when the indexes increased slightly.

Traders were not left completely in the dark. Exchange-traded funds tracking indexes continued to publish prices, effectively replacing official data from the S&P Dow Jones indexes.

The S&P 500 recovered some of its earlier losses and fell by 0.2% on Thursday afternoon. The Dow also recovered somewhat, losing 0.7%.

Best Buy Beats Estimates for Service Profits, Memberships and Laptop Demand

17 hours 24 minutes ago

Shares of Best Buy ( BBY ) rose Thursday after the electronics retailer beat earnings forecasts on rising demand for services and laptops.

The company saw first-quarter fiscal 2025 diluted earnings per share of $1.13, well above analyst estimates from Visible Alpha. Revenue fell 6.5% from the year-ago period to $8.85 billion, below expectations. Comparable store sales fell 6.1%, an improvement from the 10.1% decline recorded in the same period a year earlier.

Domestic revenue fell 6.8% to $8.20 billion, but domestic gross profit rose to 23.4% from 22.6%, which the company attributed to gains in the services category, including membership offerings. Laptop sales helped offset declines in purchases of home appliances, home theaters, games and mobile phones. International revenue was 3.3% lower to $6.44 million and gross profit rate was 22.6% compared to 23.7% in fiscal 2024.

Best Buy shares rose 11%, bringing its year-to-date gain to nearly 3%.

–Bill McCol

Kohl collapses after an unexpected loss, guidance reduced

18 hours 23 minutes ago

Kohl’s Corp. Stock (KSS) fell on Thursday after the retailer reported a surprise first-quarter net loss and lowered its full-year guidance.

Revenue fell 5% year-over-year to $3.38 billion, missing analyst expectations of $3.54 billion. Kohl’s said regular-price sales rose 2.4% year-over-year, but were offset by a large drop in sales that represented a hit of more than 600 basis points to comparable sales, which fell 4.4%.

While analyst estimates compiled by Visible Alpha only expected Kohl’s to post a modest profit of $2.41 million, or 2 cents per share, the retailer reported a net loss of $27 million, or 24 cents per share. In the first quarter of 2023, Kohl’s earned $14 million, or 13 cents per share.

Kohl’s also lowered its full-year outlook as Kingsbury said the company preferred to keep its outlook conservative given “continued uncertainty in the consumer environment.”

Kohl’s now projects net sales for the fiscal year to decline 2% to 4%, down from its last earnings report, which projected a decline of 1% to an increase of 1%.

In addition to lower sales, Kohl’s also forecast lower profits this year, with EPS ranging from $1.25 to $1.85, compared with the $2.10 to $2.70 range it achieved last quarter. The new range is also lower than analysts’ forecast of $2.10 per share for this year.

Kohl’s shares fell 27% on Thursday, extending its year-to-date loss to 31%.

-Aaron McDade

Salesforce Stock Gains Drop After Earnings

19 hours 7 minutes ago

Shares of Salesforce (CRM) fell 19% on Thursday after the cloud-based software maker reported its first lack of quarterly revenue in 18 years and issued weak annual sales forecasts as corporate customers tighten IT budgets and longer-than-average transaction cycles.

Salesforce shares have maintained an upward trend for 12 months after crossing the 50-day moving average (MA) above the 200-day MA in March last year, forming a bullish golden cross pattern. However, since topping out in March this year, the price has fallen below the 50-day MA, and the indicator also acted as a resistance line during the recent countertrend rally earlier this month. Moreover, Thursday’s earnings-driven selling may confirm a head and shoulders, a chart pattern indicating a possible market top.

With stocks weakening, investors should keep an eye on two key levels. First, monitor the $226 region, an area on the chart where price may see support in the form of a horizontal line connecting several highs over the last year, which is also near the late November price gap. Finally, it is worth looking at the level of $192, a location that finds long-term support from the trend line stretching back to June 2022.

-Tim Smith

Stocks making the biggest moves in early trading

19 hours 51 minutes ago

Profits:

• HP (HPQ): Shares of the PC maker rose 9% after it reported better-than-expected quarterly earnings. Last week, the company unveiled an AI-powered laptop and took advantage of investor hunger for AI-enabled devices.

Losses:

• Salesforce (CRM): Shares fell 17% after the cloud software maker reported its first lack of quarterly revenue in 18 years and posted weak annual sales forecasts.
• Oracle (ORCL): Shares fell 3% as Salesforce’s weak guidance weighed on the software company.
• UiPath (PATH): Shares fell 35% after the AI ​​software provider announced an unexpected CEO change and provided current-quarter sales forecasts that were well below Wall Street estimates.

US Stock Futures Fall as Salesforce Collapses

20 hours 46 minutes ago

On Thursday, Dow futures fell 0.9% in pre-session trading.

S&P futures fell 0.4%.

Nasdaq futures fell 0.3%.