Happy to see you again! We’re ready to crown a winner in our first business, technology and innovation bracket: The US presidential election (51.4%) topped the AI race (48.6%).
In today’s news, we look at what to expect during a critical earnings season.
What’s on deck:
But first things get silly again.
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The big story
All eyes on EBITDA
iStock; Rebecca Zisser/BI
Earnings season is upon us, and it’s important.
Last week’s inflation report delayed hopes for a long-awaited rate cut, leaving some wondering if a recession is back in the cards.
Jamie Dimon, CEO of JPMorgan issued a warning in the bank’s earnings report on Friday.
“There appears to be a lot of lingering inflationary pressure, which could probably persist. And ultimately, we’ve never really felt the full effect of quantitative tightening on this scale,” Mr. Dimon said.
Markets have an antidote: solid profits. When interest rate cuts were delayed earlier this year, concerns were quickly allayed by impressive numbers released by companies.
Traders work on the floor of the New York Stock Exchange during the afternoon of November 3, 2023. Michael M. Santiago/Getty
But as the old adage goes, past performance is no guarantee of future results.
With so much at stake, here’s an earnings season cheat sheet for when some of the biggest companies report and what storylines to watch.
Finance
Key companies: Goldman Sachs (April 15), Bank of America (April 16), Blackstone (April 18).
Themes to watch: AI could reduce the number of junior bank employees thanks to technology automate their heavy lifting. While interest rates remain high, the threat of private credit or non-traditional lenders remains a risk or opportunity depending on your position on the Street.
Technology
Key Companies: Meta (April 24), Microsoft (April 25), Alphabet (April 25), Apple (May 2), Nvidia (May 22), Amazon (TBD).
Themes to watch: Will demand for Nvidia chips finally decline? Can the apple to change things? Where do Microsoft and Alphabet stand in the world? AI race? Will Meta and Amazon continue their efficiency efforts to lower the costs? There are many questions about the biggest players in technology. Their leading role in the market means people will be on the lookout for answers.
Retail
Key Companies: Walmart (May 16), Target (May 22), Costco (May 30).
Themes to watch: The resilient American consumer has kept the economy afloat despite inflation and high interest rates. Reports from major retailers offer perspectives on whether they are running out of steam.
Media
Key companies: Netflix (April 18), Disney (May 7), Paramount Global (April 29).
Themes to watch: Netflix was dubbed the king of streaming earlier this year after a major earnings report. (Do not sleep Youtube!) Disney is licking its wounds after a brutal proxy fight with a big unanswered question: who will be CEO Bob Iger’s successor? The future of Paramount remains unresolved as negotiations accelerate.
Others
Key companies: Tesla (April 23), Boeing (April 24).
Themes to watch: Tesla Still Looking to Win in 2024, According to Electric Vehicle Market Trends change against that. Pressure is mounting on Boeing, leaving the airline industry scrambling.
Brief news
Your Monday headline catch-up
A quick recap of the weekend’s news:
3 things about the markets
Jamie Dimon. Brooks Kraft LLC/Corbis via Getty Images
1. The M&A market is under siege. Jeremy Barnum, JPMorgan’s chief financial officer, cited “headwinds from the regulatory environment” as the reason. M&A momentum may not accelerate. The bank’s results beat analysts’ expectations, but consulting revenue fell 21% year-on-year.
2. Stay ahead of market changes. Market strategists have explained how to invest when market sentiment turns negative. Investments in defensive sectors like consumer staples and healthcare were some of the strategies recommended by experts.
3. All that glitters is not gold. The precious metal has reached a new all-time high in 2024 – but it’s not the only commodity that has performed well this year. Oil, cocoa and copper also posted big gains as the market enters what Carlyle’s Jeff Currie calls a “classic late-cycle rally.”
3 things in technology
Tesla announced layoffs. Justin Sullivan
1. Tesla lays off more than 10% of its workforce. The electric vehicle maker is the latest major company to make job cuts, according to a report. internal memo sent by CEO Elon Musk Sunday, which was seen by BI. “There’s nothing I hate more, but it has to be done. It will keep us lean, innovative and hungry for the next growth cycle,” Musk said.
2. Healthcare startup valuations are coming back down to earth – except in AI. Health care deals are picking up again, and they don’t look like they did before the economic downturn. But some venture capitalists worry that many health tech startups are. “AI washing” to obtain additional funds.
3. Apple fans are eager for any signs of its AI intentions. The company’s shares rose more than 4% last week after announcing plans to revamp its Mac lineup with an AI-focused chip. It’s a sign investors are hoping AI could help save money what’s shaping up to be a tough year for the tech giant.
3 things in business
Marco Bottigelli/Getty, Yevgen Romanenko/Getty, Maskot/Getty, Tyler Le/BI
1. The hidden cost of leaving a big city. Americans fled major coastal cities in droves during the pandemic — and that number has only held steady since. But while people seek affordability in smaller towns, moving away from big cities it could be terrible for your career.
2. The consequences of the office apocalypse are only just beginning. As federal funds dry up and remote work hits revenues, cities and states across the United States are facing challenges. facing a nasty budget crisis.
3. The Iranian attack on Israel could be bad news for Russia. Michelle Grisé, senior policy researcher at the US think tank RAND, said on Thursday that a crisis in the Middle East could hinder Russian arms supplies and strengthen China’s own influence in the region.
In other news
What’s happening today
The Insider Today team: Dan DeFrancesco, associate editor and presenter, in New York. Jordan Parker Erb, editor-in-chief, in New York. Hallam Bullock, editor, in London. George Glover, journalist, in London. Grace Lett, associate editor, in Chicago.
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