The Rundown - Microsoft Releases New Call of Duty, Hoka Drives Sales Surge for Deckers

Episode Date: October 25, 2024

Stock market update for October 25, 2024.

Public.com presents the rundown. Your daily market update in five minutes. My name is Zaid Admani, and today is Friday, October 25th. In today's episode, we tell you about Tesla's historic day yesterday. We also dive into a block merger between two fashion giants and tell you why Apple is slowing down the production of their Vision Pro headsets. Then stick around to the end of the show to find out why Skechers and Deckers are surging and how much money Call of Duty has made over the years. All right. Let's go.

Guys, the S&P 500 finally got a win this week. The S&P was up 0.2% on Thursday, and the NASDAG jumped 0.8%. And honestly, it was all thanks to Tesla. Tesla had a historic day yesterday following their Q3 results. The stock jumped 22%, which is the best day Tesla has had in 11 years. The company added $150 billion in market cap yesterday. That's the most value. increase ever for Tesla in a single day. The $150 billion is more than the market cap of GM,

Ford, and Stalantis combined. So that just gives you some perspective on the huge move in Tesla's stock yesterday. And because of this big move, the stock is now in the green for the year. And Elon Musk himself saw his net worth increase by $34 billion. It's not a bad day for him. By the way, we covered Tesla's earnings in detail on yesterday's episode, so go check that out if you missed it. But yeah, an incredible bounceback from Tesla, especially after they got clown for their Robotaxy event where the stock fell 8% following that event. So haters like me today are in shambles right now. And just to be clear, I don't hate Tesla cars.

I actually own a Tesla myself. I just thought that the stock was overvalued. But I guess the markets didn't think so. I'm telling you, man. Just list whatever stock I'm going to start hating on in the Spotify comments. And it's going to start rally. Let's run through some headlines. Let's start with the fashion industry.

A federal judge is blocking an $8.5 billion acquisition between two fashion powerhouses. This acquisition was between Tapestry and Capri. Tapestry owns brands like Coach and Kate Spade, and they wanted to acquire Capri, which holds companies like Versace, Michael Coors, Jimmy Chuse, and more. And the acquisition was blocked because the judge thought that it would be anti-competitive. Tapestry was expected to control 59% of the addressable market if this deal went through.

And look, this is just my personal opinion, but I was a little surprised by this move. I don't know too much about the fashion industry, but I do feel like it's a pretty competitive landscape. There are other powerhouses in the fashion space. You have LVMH. You have Caring, which owns brands like Gucci and St. Laurent. So, again, surprise that this merger

between these two companies got blocked. I mean, one thing is pretty clear. The government has been very aggressive when it comes to preventing mergers. We've seen that in big tech, but it's not just tech companies, the DOJ blocked the merger between JetBlue and Spared Airlines earlier this year. And now they're blocking the merger between these two fashion companies.

So it's tough out there for the M&A crowd. This was pretty devastating news for Capri shareholders. The stock dropped around 50% after this deal blockage was announced, but both parties are appealing the decision. So it could still end up going through, but it's going to take a court battle now. Now, shifting gears to a big tech company, that's probably also one of the biggest luxury brands in the world. Apple, things aren't going so great for the Applevision Pro.

According to the information, Apple is slowing down production of their VR headset. You know, the Vision Pro sales have dropped significantly since its initial release. According to Counterpoint Research, Apple sold 370,000 units of the Vision Pro in Q1, but since then has only sold around 50,000 units. So that's a huge drop-off, and that's why Apple is thinking about slowing down production for the Apple Vision Pro. They might stop it all together. Now, Apple's not abandoning VR completely. They're just working on a more cost-effective model, you know, because the Vision Pro sells for 30,

$3,500, not many people want to spend $3,500 to wear an extremely heavy headset on their face. That looks kind of goofy. Add in the fact that meta's VR headset sell for around $500 and that they showed off their AR glasses, which seems to be the future of technology, Apple's probably rethinking some strategies here. I'm not even sure if this new cost-effective model is going to be successful. Unless they can get the price down to under $1,000, I just don't see people wanting to put a headset on their face.

By the way, Apple is announcing some new products next week. The company announced that next week is going to be the week of the week. of Mac announcements starting on Monday. The current rumors are calling for updated MacBook Pros with the M4 chip, also a new iMac and Mac Mini. By the way, I have a Mac Mini and honestly, incredible device, especially for the price. So looking forward to see when Apple shows off next week

because I could use an upgrade. Oh, also next week Apple is reporting earnings on Thursday. So yeah, next week is gonna be big for Apple. I wonder if they're gonna say anything about the Vision Pro and their earnings call. Let's talk about some stocks making moves today. Shares of Decker Outdoors, the company behind the Hoka sneakers and Ugs is rising after beating earnings and raising its outlook for the year.

Hoka's continued to be very popular. The shoe experienced a 35% sales growth in the quarter, and Hugs also held their own with sales up 13%. Hocas are great. I just didn't expect Ugs to make a comeback. Just never been a fan. Now, Decker has also been capitalizing on the shelf space at retailers like Dick's sporting goods that were made available by Nike's decision to cut back on.

their relationship with wholesale retailers. That definitely backfired for Nike because it opened up the door for Deckers to come in and take some market share. Shares of Decker's are up more than 13% on this news. Sticking with the shoe theme shares of Skechers are up this morning after they release solid earnings. They reported record quarterly revenues of $2.35 billion, which represents a nearly 16% in growth. The company is really dialing in on the comfort trend and they attributed some of the growth to the innovation like their hands-free slip-ons. So yeah, things are looking up for Skechers right now, investors are loving it too. Shares of Skechers are up 7% on this news. Now, on the flip side, shares of Joby Aviation are plummeting after the aircraft company

announced an equity offering for $200 million. The company said the money will be used to continue the company's work to get a EVTOL to market. An EVTOL is an electric vertical takeoff launch vehicle. It so's helicopter-looking things that can fly like an airplane but are also super quiet. Go look up a video of them because they are pretty cool. But I guess Joe, Joby isn't close to getting them to market yet. So that's why they need to raise all this money. Joby has around $825 million as of its Q2 report, and the company will release their Q3 earnings in November.

Joby's stock is down around 16% on this news. Let's wrap the show with a fun fact. The new Call of Duty game comes out today, Black Op 6, and these Call of Duty games have been a money printing machine over the last two decades. The franchise has generated $30 billion in revenue since the first. First game came out back in 2003. It's been the best-selling video game franchise in America for 15 years straight. And this year, things are a bit different.

Microsoft owns Call of Duty now because they've bought Activision Blizzard for $69 billion. That deal officially closed about a year ago. And because of that, people that are subscribed to Xbox Game Pass, like I am, they'll be able to play Call of Duty as part of that Game Pass subscription. Microsoft is also bringing the Call of Duty game to Nvidia's streaming service for the first time. So yeah, annual October call of duty release. And, you know, a decade ago, I would have stayed at home all weekend long playing call of duty nonstop.

Can't do that anymore. But I might try to sneak in a quick sesh here to there. It's just I haven't played call of duty in so long that I'm kind of scared to jump back in. Well, all right, guys, that's the rundown for today. That's the rundown for the week. Crazy week, especially with the Tesla results at the end. And next week is going to be at another level. We're getting over 100 companies reporting earnings next week and some of the biggest

companies in the world, Apple, Microsoft, Google, meta, Amazon, they're all reporting next week. So yeah, we are locking in and the shows next week are going to be at another level. Thank you guys again for listening. Shout out to Mike and Connor for all the help behind the scenes. Have a great weekend, everybody.

And we'll see you guys back here on Monday. This is the rundown. Your real-time resource for news events and trends in the markets. All views presented in the show reflect the opinions of the guests. You should not take any mention of a publicly traded security as recommendation to buy, sell, or hold that security. Run-down guests are not financial advisors and are not affiliated with public holdings or its subsidiaries, you should make your own financial and investment

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