$PSKY

Sector Update: Consumer Stocks Mixed Thursday Afternoon

Consumer stocks were mixed Thursday afternoon, with the State Street Consumer Staples Select Sector SPDR ETF (XLP) rising 1.5% and the State Street Consumer Discretionary Select Sector SPDR ETF (XLY) shedding 0.6%.In corporate news, Tesla (TSLA) shares fell 3.7% after it issued higher-than-expected 2026 capital expenditure guidance. TechCrunch reported the company is planning to spend $25 billion this year, compared with $8.5 billion in 2025.Warner Bros. Discovery (WBD) said Thursday its shareholders voted to approve the adoption of the merger agreement with Paramount Skydance (PSKY). Warner shares were down 0.8%, and Paramount fell 5.8%.Vail Resorts (MTN) reported Thursday that skier visits from the start of the ski season through April 19 were down 14.9%, compared with the same period a year ago. Shares fell 5.8%.

Top Midday Stories: Tesla Shares Fall Despite Q1 Beats; ServiceNow Says Iran War Weighed on Q1 Subscription Revenue

All three major US stock indexes were down slightly in late-morning trading Thursday, as investors continued to monitor developments in the Strait of Hormuz.In company news, Tesla (TSLA) reported Q1 adjusted EPS late Wednesday of $0.41, up from $0.27 a year ago and above the FactSet consensus analyst estimate of $0.36. First-quarter revenue was $22.39 billion, up from $19.34 billion a year ago and above the FactSet consensus of $22.1 billion. The company said it intends to use Intel's (INTC) upcoming 14A process to make chips at its Terafab advanced AI project in Austin, Texas, Reuters reported late Wednesday, citing Tesla CEO Elon Musk. Chief Financial Officer Vaibhav Taneja said late Wednesday that Tesla has delayed the rollout of its most advanced driver-assistance features in China due to regulatory issues. Lastly, the firm is creating 1,000 new jobs at its Gruenheide gigafactory in Germany by the end of June to raise weekly production by roughly 20% from Q3, Reuters reported Thursday, citing a company spokesperson. Tesla shares were about 1.8% lower.ServiceNow (NOW) reported Q1 non-GAAP earnings late Wednesday of $0.97 per diluted share, up from $0.81 a year earlier and matching the FactSet consensus estimate. First-quarter revenue was $3.77 billion, up from $3.09 billion a year ago and above the FactSet consensus of $3.75 billion. ServiceNow said Q1 subscription revenue growth saw about a "75 basis point headwind from delayed closings of several large on-premise deals in the Middle East, due to the ongoing conflict in the region." For Q2, the company said it expects subscription revenue of $3.815 billion to $3.820 billion, above the FactSet consensus of $3.751 billion. For full-year 2026, it expects subscription revenue of $15.74 billion to $15.78 billion, above the FactSet consensus of $15.55 billion. ServiceNow shares were down 17.2%.Thermo Fisher Scientific (TMO) reported fiscal Q1 adjusted earnings Thursday of $5.44 per share, up from $5.15 a year earlier and above the FactSet consensus of $5.25. Fiscal Q1 revenue was $11.01 billion, up from $10.36 billion a year ago and above the FactSet consensus of $10.86 billion. Thermo Fisher shares were down 10.4%.Warner Bros. Discovery (WBD) said Thursday its shareholders voted to approve the adoption of the merger agreement with Paramount Skydance (PSKY). The deal is expected to close in Q3, the company said. Warner Bros. shares were down 0.4%, while Paramount shares were down 5.4%.Texas Instruments (TXN) reported Q1 earnings late Wednesday of $1.68 per diluted share, up from $1.28 a year earlier and above the FactSet consensus of $1.36. First-quarter revenue was $4.83 billion, up from $.07 billion a year ago and above the FactSet consensus of $4.53 billion. For Q2, the company said it expects EPS of $1.77 to $2.05 on revenue of $5 billion to $5.40 billion. Analysts polled by FactSet expect $1.57 and $4.86 billion, respectively. Texas Instrument shares were up 18.5%.Avis Budget Group (CAR) has seen its stock fall by over 62% in just two days after rising nearly 600% since late March, Bloomberg reported Thursday, citing data from S3 Partners. Avis short sellers pocketed $2.8 billion during Wednesday's rout, countering the $2.7 billion they lost the prior three days, the report said, citing S3 Partners. Avis shares were down 47.1%.Price: $378.26, Change: $-9.25, Percent Change: -2.39%

Warner Bros. Discovery Shareholders Approve Sale to Paramount Skydance

Warner Bros. Discovery (WBD) said Thursday its shareholders voted to approve the adoption of the merger agreement with Paramount Skydance (PSKY).The deal is expected to close in Q3, Warner Bros. said.Price: $27.34, Change: $+0.01, Percent Change: +0.02%

Correction: --Warner Bros. Discovery Shareholders Approve $110 Billion Sale to Paramount Skydance, Bloomberg Reports

Warner Bros. Discovery Shareholders Approve $110 Billion Sale to Paramount-Skydance, Bloomberg Reports

Warner Bros. Discovery Shareholders Approve $110 Billion Sale to Paramount-Skydance, Bloomberg Reports

Wedbush Lifts 2026 Box Office Outlook Following Strong First-Quarter Performance, Wedbush Says

Wedbush Securities on Monday raised the North American box office forecast for 2026, citing strong first-quarter growth and summer releases.The brokerage expects box office proceeds to rise 13% annually to $9.8 billion this year, up from 10% previously projected. First-quarter collections grew 25% year over year to $1.8 billion.CinemaCon, a trade show for the motion picture theater industry, was conducted in Las Vegas last week. The event showed strong studio slates and a focus on lengthening theatrical windows, Wedbush said."All of the studios came out this year with more confidence than last year," Wedbush analysts, including Alicia Reese, said.The deal between Warner Bros. Discovery (WBD) and Paramount Skydance (PSKY) dominated the event, with Paramount Chief Executive David Ellison promising a 45-day exclusive theatrical window upon deal completion and an output increase to 30 titles per year, Reese said.Theater operators have been demanding a 45-day minimum, Reuters reported last week. Movies staying in theaters longer drives more favorable economics across theatrical and streaming, according to the Wedbush note.Comcast's (CMCSA) Universal said it planned to extend the exclusive theatrical window to 45 days by 2027, compared with its current 17-day window that is seen moving to 35 days in 2026, Reese said.The summer slate, especially in the third quarter, "is shaping up very nicely," Reese said.Last week, B. Riley Securities raised its 2026 box office projections to $9.55 billion from $9.40 following a better-than-expected first quarter.Wedbush upgraded its 2027 box office growth estimate to 5% from 4%, at $10.2 billion.However, if the combined Paramount-Warner Bros. company cuts theatrical output, there could be some downside risk to the 2027 estimate, Reese said."That said, our current estimate does not anticipate that the combined studio reaching the company's stated goal of 30 total titles," Reese said.

B. Riley Upgrades 2026 Box Office Outlook Following First-Quarter Beat

US box office revenue this year is set to come in higher than previously projected following a better-than-expected first quarter, B. Riley Securities said Friday.The industry raked in box office proceeds of about $1.74 billion in the first three months of the year, jumping 22% year over year and ahead of the brokerage's $1.59 billion view. The performance reflected a 14% increase in January, a "flattish" February and "healthy" gains in March, which benefited from the commercial success of the Amazon (AMZN) MGM-distributed film "Project Hail Mary," B. Riley said.Paramount Skydance's (PSKY) "Scream 7," Walt Disney's (DIS) "Hoppers" and Warner Bros. Discovery's (WBD) "Wuthering Heights" also contributed to the first-quarter outperformance, B. Riley analyst Drew Crum said in a note to clients.The brokerage now estimates domestic box office collections of $9.55 billion for 2026, up from its previous expectations of $9.40 billion, with the outperformance in the first quarter "serving as the key driver to this upward adjustment."The first-quarter domestic box office provided "some needed confidence following a shaky (second half of 2025), while this momentum has continued into early (second quarter)," Crum said.B. Riley reiterated its US box office revenue estimate of $2.70 billion for the current three-month period, reflecting an annual increase of 1%. For the third and fourth quarters, the brokerage is expecting proceeds of $2.70 billion and $2.40 billion, respectively."Improving box office trends could lead to quarterly beats, upward revisions to estimates, and hence multiple expansion," Crum said. "General optimism for the 2026-2027 slate, further progress on windowing, and encouraging developments regarding labor negotiations for Hollywood guilds, may help sentiment too."The brokerage raised its price targets on the stocks of AMC Entertainment (AMC) to $2 from $1.50 and on Cinemark (CNK) to $34 from $30, with neutral ratings. It continues to have a buy rating on Imax (IMAX) shares.Price: $1.90, Change: $+0.29, Percent Change: +17.70%

Netflix Investors Disappointed With Unchanged Margin Outlook, MoffettNathanson Says as Shares Plunge

Netflix (NFLX) disappointed investors by maintaining its margin outlook even though its cost base apparently would have benefited from its decision to walk away from a deal to acquire Warner Bros. Discovery (WBD), MoffettNathanson said in a report on Friday.The streaming giant late Thursday posted first-quarter revenue above Wall Street's estimates. It maintained the full-year revenue guidance at $50.7 billion to $51.7 billion and an operating margin outlook at 31.5%.The FactSet-polled consensus is for $51.33 billion in 2026 sales.Netflix in February abandoned its plan to acquire Warner Bros., handing it over to Paramount Skydance (PSKY). Last quarter, the company pointed to $275 million in M&A expenses this year, which most saw as fully attributable to the then-pending Warner Bros. deal, MoffettNathanson Senior Research Analyst Robert Fishman wrote.However, after incorporating the acquisition of AI filmmaking technology company InterPositive and the pull forward of Warner Bros. deal costs, total M&A expenses remained largely unchanged, Fishman said. Netflix Chief Financial Officer Spencer Neumann made similar remarks on an earnings call Thursday.Netflix acquired InterPositive in March.Some on Wall Street, including UBS Securities, were pricing in an upgrade to the revenue outlook due to earlier-than-expected price increases. But the unchanged margin guidance came as a "bigger surprise" than Netflix reiterating its revenue guidance, Fishman said.The stock plunged nearly 10% in Friday trade.The company announced pricing changes for all its US plans in March, including a new $8.99 monthly subscription for the ad-supported standard tier.MoffettNathanson said Netflix's long-term trajectory remains intact."Sure, the absence of a raise to 2026 guidance likely caught some ahead of their skis on near-term margin expectations; yet, the M&A costs in the 2026 expense base only create an easier comp for next year," Fishman wrote.Price: $97.90, Change: $-9.90, Percent Change: -9.18%

Market Chatter: Paramount Skydance Says 'Call of Duty' Movie to Release in 2028

Paramount Skydance (PSKY) said the film adaptation of the Microsoft (MSFT)-owned Activision's "Call of Duty" game franchise will release on June 30, 2028, The Variety reported Thursday, citing a company presentation at CinemaCon.Paramount has a track record of adapting games into movies, including "Sonic the Hedgehog," according to the report.Paramount Skydance did not immediately respond to a request for comment from.(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)Price: $11.74, Change: $+0.06, Percent Change: +0.56%

S&P 500 Posts Weekly Gain Ahead of Iran Peace Talks, Earnings

The Standard & Poor's 500 index rose 3.6% this week in a broad climb ahead of high-stakes peace talks between Iran and the US and the Q1 earnings reporting season.The S&P 500 ended the week at 6,816.89, its second positive week in a row. The index is up 4.4% for April, erasing much of March's 4.6% drop. It is down 0.4% for the year.A two-week ceasefire reached between the US and Iran early this week appeared to be holding as officials from Washington and Tehran were expected to meet on Saturday in Pakistan, which helped broker the ceasefire.The coming week also marks the unofficial start of the Q1 earnings reporting season.US consumer sentiment hit the lowest on record this month, reflecting heightened worries about higher prices and the overall economic fallout from the Middle East conflict, according to the University of Michigan's preliminary April survey. The survey was largely completed before the announcement of the two-week ceasefire.A report by the Bureau of Labor Statistics showed US consumer inflation accelerated to its highest monthly reading in nearly four years in March as the Middle East conflict sent energy prices sharply higher. The data showed energy price growth jumped about 11% sequentially in March, led by a 21% surge in gasoline, accounting for nearly three quarters of the headline increase.Every sector other than energy rose this week. Communication services and consumer discretionary climbed 5.8% each, followed by a 4.8% gain in technology and a 4.7% advance in industrials. Materials were also strong, up 3.5%, while real estate and financials rose more than 2% each. Utilities, consumer staples and health care also edged higher.Amazon.com (AMZN) was the top performer in consumer discretionary, climbing 14%. The company said its Amazon Web Services' artificial intelligence revenue run rate was more than $15 billion in Q1 and "ascending rapidly." AWS has the potential to grow even faster, Amazon Chief Executive Andy Jassy said in a letter to shareholders.Paramount Skydance (PSKY) had the largest percentage increase in communication services, rising 12%. The company's $54 billion bridge loan backing its acquisition of Warner Bros. Discovery (WBD), provided by Bank of America (BAC), Citigroup (C), and Apollo Global Management (APO), has been sold down to wider group of banks and reduced to $49 billion, according a regulatory filing.Intel (INTC) led the advance in the technology sector, jumping 24%. Intel and Alphabet's (GOOG, GOOGL) Google expanded a multiyear agreement to develop artificial intelligence and cloud infrastructure using Xeon processors and custom infrastructure processing units. Intel's Xeon chips will continue to support Google Cloud systems across AI, inference and general computing workloads, the companies said.Energy, the lone sector in the red for the week, fell 4.1%.Phillips 66 (PSX) led the energy sector's drop, sliding 9.6%, as the company said its Q1 results are expected to be weighed down by $900 million in mark-to-market losses tied to surging commodity prices, according to preliminary data. The jump in commodity prices also led to a net outflow of almost $3 billion of cash collateral on derivative positions, Phillips 66 said in a regulatory filing.Earnings reports are expected next week from many large companies, including Goldman Sachs Group (GS), JPMorgan Chase (JPM), Johnson & Johnson (JNJ), Wells Fargo (WFC), Citigroup (C), BlackRock (BLK), Bank of America (BAC), Morgan Stanley (MS), Progressive (PGR), Netflix (NFLX), Pepsico (PEP), Abbott Laboratories (ABT) and Charles Schwab (SCHW).Economic data will include the March producer price index as well as March existing home sales, import prices, industrial production and capacity utilization, among other reports.

Netflix Set to Beat 2026 Guidance Amid Early US Price Increases, UBS Says

Netflix (NFLX) may outperform its own guidance for the full year as the impact of earlier-than-expected price increases takes hold, UBS Securities said in a note emailed Thursday.Last month, the company increased prices across its US plans, including raising its ad-supported standard tier to $8.99 per month from $7.99. The price of its standard plan without ads rose by $2 to $19.99 a month, while the premium tier now costs $26.99, compared with $24.99 previously.These price increases offer upside potential for 2026 estimates, UBS analysts including John Hodulik wrote.UBS projects currency neutral revenue growth of 14% with a 32.6% margin rate for 2026, compared with guidance that called for a 11% to 13% revenue increase and a 31.5% margin.BofA Securities previously said that Netflix's most recent round of price increases highlighted the streaming giant's pricing power.The company is likely to roll out more hikes in other major markets that are expected to boost average revenue per member, according to the UBS note.The widening price gap between plans with and without ads, along with new demand-side platform relations with companies including Amazon (AMZN), will likely double Netflix's ad-supported revenue in 2026, Hodulik said."While Netflix continues to slowly grow share of total TV viewing in the US, its share of streaming viewership remains under pressure given growth in (free ad-supported television)," Hodulik added.In February, Netflix dropped its plans to acquire Warner Bros. Discovery (WBD), which will now be acquired by Paramount Skydance (PSKY)."With the Warner Bros bid behind it, we believe Netflix is still positioned to benefit from its solid slate of content this year including the return of four of its top 20 series, new films such as War Machine and The Rip, a growing list of live events and the ramp in video games," Hodulik said.Shares of Netflix were up 2.5% in recent trading on Thursday.Price: $101.64, Change: $+2.25, Percent Change: +2.26%