The Rundown - Tesla to Cut 10% of Staff, Apple Loses Spot as World's Largest Smartphone Maker

Starting point is 00:00:00 Public.com presents the rundown, your daily market update in five minutes. My name is Zadmani, and today is Monday, April 15th. In today's episode, we get you ready for an action-packed week on Wall Street. Earning season kicks off this week, and there are a lot of big companies reporting their Q1 earnings. Also, layoffs might be coming to Tesla. We tell you what the rumor mill is saying. We got some new numbers this morning showing that Apple's iPhone sales are still down, not looking so good.

Starting point is 00:00:27 And then stick around to the end of the show to hear the latest stats on. caffeine consumption in the U.S. Spoiler alert, we're drinking more coffee. All right, let's get into it. Well, it's been a tough couple weeks for the stock market. The Dow, S&P, NASDAQ, all finished lower last week again after the March

Starting point is 00:00:43 CPI report came in hotter than expected. It kind of freaked out investors because it might mean no rate cuts from the Fed anytime soon. Overall, it's been a pretty tough start to Q2 for the stock market. The S&P is down more than 2% since the start of the month. Hopefully this earning season will get things back in the right direction. And speaking of

Starting point is 00:01:00 We have an action pack week this week. Q1 earnings season kicks off and about 10% of the companies in the S&P 500 are reporting earnings this week. Companies like Goldman Sachs, Schwab, Bank of America, United Airlines, TSM, Netflix are just some of the companies reporting. We're going to be covering many of these companies in the rundown this week, so make sure you guys are tuning in every day to stay in the loop. Personally, I'm really looking forward to Netflix earnings. They've had some solid earnings over the last couple quarters. I want to see if they can keep the momentum going. Those earnings come out on Thursday after the close.

Starting point is 00:01:29 We got some positive economic data to start off the week. March retail sales numbers just came out, and retail sales jumped 0.7% in March. That was much higher than what economists were expecting. The forecast was a 0.3% increase. So what this means is that consumers continue to shop. They're not cutting back on spending. And that seems to be making Wall Street pretty happy right now. I'm recording this show before the markets open, but the futures for the Dow, S&P, and NASDAQ are all flashing green right now.

Starting point is 00:01:55 Great start to the week. All right, let's run through some headlines. Looks like Tesla is getting ready to cut about 10% of its workforce. According to a report from Reuters, Tesla sent out an internal email to over 140,000 people that work at the company, citing the reason for the cuts are cost and productivity improvements. Look, it's no secret that Tesla has been struggling lately. Just a couple weeks ago, Tesla reported an 8% drop in their Q1 deliveries, and Tesla stock is down more than 30% this year, making it one of the worst performing companies in the S&P 500.

Starting point is 00:02:25 It seems like the demand for EVs is slowing, and Tesla's also face. a ton of competition as well. Not just from legacy car makers in the U.S., but especially from low-cost carmakers in China. Like, they got EVs in China starting at like $10,000. So that's tough to compete with. But it looks like Elon Musk does have a plan to save Tesla. Robotaxis. Elon Musk on Twitter announced that Tesla's plan for Robo Taxes will be revealed on August 8th. So we'll see what happens. Tesla is reporting earnings on April 23rd, so hopefully we'll get some more information then. Another company struggling this year has been Apple. While their stock did have a nice bounce back last week, they're still lagging behind other

Starting point is 00:02:59 big tech giants like Microsoft, Google, and Amazon. Well, things aren't getting any better for Apple. There's new data showing that the company suffered a 10% drop in iPhone shipments for Q1. According to Bloomberg, Apple shipped 50.1 million units, which was worse than the 51.7 million that was expected by analysts. And this slow start to the year has caused Apple to lose its title as the world's largest smartphone maker to Samsung, which now has a 21% market share worldwide compared to Apple's 17%. And the reason for Apple's decline is not macro-related. In fact, the smartphone market actually had its best growth in years in Q1. But Apple is facing a lot more competition, especially in the Chinese market,

Starting point is 00:03:37 from companies like Huawei and Xiaomi, which ranked third in Q1 for smartphone shipments and has a 14% market share. So I wonder what Apple's going to do to turn things around. Probably unlikely to announce a Robotaxie anytime soon because they shut their car program earlier this year. All right, let's talk about some stocks making moves today. Goldman Sach stock is almost 4% of the first. morning after the company reported earnings and be on both revenue and earnings estimates for the

Starting point is 00:04:02 quarter. They reported profit growth of 28% and a solid performance within its investment banking division, which saw its revenues increased by 32% in the quarter. Probably helps the IPO market strong right now. Goldman Sachs also saw an 18% increase in their wealth management sales. On the flip side, a stock not doing so hot this morning is Salesforce. Salesforce stock is down almost 3% this morning after reports of the company is an advanced talks to buy a cloud data company infomatica. Yeah, infomatica. I've never heard of this company before. It has a market cap north of $11 billion. And it could be one of Salesforce's largest acquisitions ever. Salesforce has a pretty rich history of acquisitions. They've done over 117 total acquisitions in the company's history, the largest one

Starting point is 00:04:46 being Slack, which they bought for $27 billion back in late 2020. But the company has taken on a lot of heat from activist investors in the past because of their acquisition strategy. Like this hedge fund, Elliott management and other funds are pushing Salesforce to not do as much M&A and even go ahead and dismantle the M&A committee. These hedge funds want Salesforce to focus more on cost cutting. So we'll see how the activist investors view this deal if it goes through. All right, let's wrap the show with a fun fact. Today's fun fact is about coffee, specifically how much coffee we consume in the U.S. Daily coffee consumption in the U.S. is at a 20-year high. Americans are hooked on caffeine, and I'm guilty as charged.

Starting point is 00:05:25 Nearly two-thirds of adults in the U.S. said they drank coffee in the past day, according to the National Coffee Association. And 75% of adults said they had coffee in the past week, which is up 4% from a year ago. And if you look at coffee prices, which yes, is a tradable commodity, coffee prices are up more than 10% over the last year. So, yeah, first it was chocolate, now coffee. All my vices are getting pretty expensive now.

Starting point is 00:05:47 All right, guys. Well, that's all I got for you guys today. If you guys enjoy the show, give us a five-star rating on Apple, Spotify. Also, Public has another podcast called the Leading Indicator Podcast. It's a longer podcast with the interview leaders in business, finance, and technology. The last episode they interviewed Professor Scott Galloway, and it was hosted by my friend, Kyla Scanlon. Great episode, highly recommended. We'll put the link in the description if you guys want to go check it out. Thank you guys again for listening, and we'll see you guys back here tomorrow.

Starting point is 00:06:13 This is the rundown, your real-time resource for news events and trends in the markets. All views presented in this 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. Rundown guests are not financial advisors and are not affiliated with public holdings or its subsidiaries. You should make your own financial and investment decisions or consult, respective professionals. Learn more at public.com disclosures. In partnership with Zaid Admani, brokerage services for U.S. listed, registered securities

Starting point is 00:06:43 are offered by Open to the Public Investing Incorporated, member FINRA and SIPC.

The Rundown - Tesla to Cut 10% of Staff, Apple Loses Spot as World's Largest Smartphone Maker

There aren't comments yet for this episode. Click on any sentence in the transcript to leave a comment.