Tariff jitters are high as analysts head toward Amazon’s first-quarter earnings
Future Publishing/Future Publishing via Getty Images
Amazon will report first-quarter earnings after the closing bell on Thursday.
Uncertainty is high as tariffs could directly impact the e-commerce firm.
But outlooks among Wall Street firms remain relatively strong.
Wall Street is feeling upbeat but cautious before Amazon’s first-quarter earnings report on Thursday.
While investors are eager to gauge how the e-commerce giant performed amid the rise in recession fears during the first three months of the year, Amazon’s second-quarter guidance will be particularly important.
That’s because the company is especially vulnerable to tariffs, which could create a particularly challenging environment for retailers.
Still, Wall Street remains bullish on the firm’s results, looking for signs of strength from Amazon Web Services and AI spending.
Here’s what the biggest banks are saying:
Amazon will meet conservative expectations for the first quarter, but things will get trickier from here, Deutsche Bank analysts wrote.
Earnings revenue should come in strong at $155.5 billion, boosted by a weaker dollar. But while April shows signs of strength, with consumer demand bolstered by fears of painful tariffs later in the year, investors shouldn’t expect that to last.
Deutsche listed a handful of overhangs that could lead to challenges going forward. They include a revenue slowdown in the second half of the year, weak ad checks in the first quarter, and tariff implications for costs and advertising revenue.
“All in, we believe it best to be cautious at this point, and model total 2Q revenue growth $159bn ~170bps below the street, on Q/Q growth of only 2% as we look for a more muted consumer demand environment to drive sub-seasonal growth for Amazon as we move through year,” analysts wrote.
Deutsche holds a “Buy” rating on the stock, with a $206 share price target.
Amazon can deliver a strong first quarter, Bank of America said, but the company is entering “unchartered (and tariffed) seas in 2Q.”
BofA analysts expect Amazon to slightly beat consensus estimates with $155.5 billion in sales, predicting that consumer spending held up well amid tariff jitters. Meanwhile, the bank said expectations for 17.4% year-to-year AWS growth are realistic.
While BofA mirrored Deutsche Bank’s uncertainty on how tariffs could disrupt future quarters, it remains optimistic.
“We acknowledge 2Q & 2H revenue uncertainty (retail, ads and Cloud), but remain confident on Amazon’s ability to take share in eCommerce, improve retail margins via headcount cuts, & benefit from Cloud AI demand,” BofA wrote. Shares of Amazon, a trade deal beneficiary, could benefit from tariff negotiations.
Bank of America maintains its “Buy” rating, and holds a price objective of $225.
Analyst Arun Sundaram expects Amazon to beat first-quarter estimates, forecasting $155.2 billion in revenue and $18.1 billion in operating profits.
Supporting margins are a sliding greenback, tariff-hastened consumption, e-commerce cost reductions, and faster growth in advertising, cloud, and subscriptions.
As with other firms, CFRA instead expects guidance for second-quarter earnings to be particularly important for investors.
But while they’re a near-term risk, Sundaram sees tariffs as an opportunity for Amazon to boost market share. Meanwhile, the end to the de minimis import rule next month, which exempts tariffs on lower-priced goods, could make Amazon more competitive against firms like Temu or eBay.
Amazon’s spending plans will also be top of mind for investors, given the company’s mixed signals on capital expenditures. Though the firm is a major AI hyperscaler, CFRA sees a possibility that investment spending pulls back amid a weaker macroeconomic outlook.
On April 24, CFRA lowered Amazon’s price target to $245 per share.
The outlook for Amazon remains fundamentally positive, with several factors justifying bullish expectations, JPMorgan said.
The bank expects rising operating income, improved positioning in the artificial intelligence sector, and AWS cloud growth to pick up in the second half of the year. First-quarter sales should reach $154 billion, while AWS will expand 16.5%.
“We remain bullish as AMZN drives non-Al growth & tightens the GenAl gap, which supports improved AWS trends in 2H,” analysts wrote. “N.America margins continue to expand supported by inbound regionalization & inventory placement, SD facility buildout, & automation/robotics, supporting FC ramp despite heavy 2025 cape growth.”
To be sure, tariffs will be the near-term threat, but Amazon has options, JPMorgan said. Although 30% to 40% of products could be sourced from China, the firm could pressure suppliers to take on added costs, cancel orders, re-route supply chains, or have consumers bear the cost of tariffs.
JPMorgan rates Amazon “Overweight,” with a $220 price target for the stock.
Goldman analysts lowered estimates to showcase a more conservative outlook, as dropping consumer confidence and rising trade barriers bite into Amazon’s margins.
Amazon faces key risks ranging from product inflation to profit headwinds stemming from the firm’s investment frenzy.
However, when it comes to headwinds, a Goldman analysis found that Amazon could significantly mitigate costs by reducing exposure to China, and focusing more on domestic merchandise.
“AMZN continues to be the most debated stock among our wider coverage universe on the back of higher global trade tensions,” the analysts wrote. “Looking long-term, AMZN remains one of our top picks and provides investors with a range of exposures to virtually all key secular growth themes across Consumer Internet and Cloud Computing.”
Goldman holds a “Buy” rating with a $220 target on the Amazon stock.
China’s solar industry remains in red as trade war adds to problems
By Colleen Howe
BEIJING (Reuters) -China’s solar manufacturers reported losses this week as U.S. President Donald Trump’s trade war put further pressure on demand in an industry where top manufacturers were already facing low prices and tariffs on exports to the United States.
Top producers Longi Green Energy and JinkoSolar both reported a net loss of 1.4 billion yuan ($193 million) for the first quarter, while losses for peers JA Solar and Trina Solar totalled 1.6 billion yuan and 1.3 billion yuan, respectively.
Longi, which also turned in a net loss of 8.6 billion yuan for 2024, told analysts in a call that demand for solar products was expected to be flat year-on-year in 2025.
“During the reporting period, solar industry supply chain prices were at a low level, combined with overseas trade policies impacting demand, all segments of the industry were under pressure,” said Jinko, where losses increased from 473.7 yuan in the fourth quarter of last year.
The company’s sales of solar products, including silicon wafer, solar cells and modules, fell 12.68% year-on-year to 19,130 megawatts in the quarter.
Jinko said it saw the fastest growth in the Asia Pacific and Africa regions, although China, the U.S. and Europe remain the largest markets.
Even before Trump’s trade war, in which he has levied 145% tariffs on imports of Chinese goods, Chinese solar exports were facing tariffs in the U.S., the second-biggest solar market after China.
As a result, Chinese manufacturers had set up production bases in third countries in Southeast Asia – countries that U.S. manufacturers later targeted with trade cases alleging they were flooding the market with cheap goods.
In response to one of those cases, the U.S. last week finalised tariffs of as high as 3,500% on solar products from Chinese solar manufacturers with factories in Malaysia, Cambodia, Thailand and Vietnam.
The U.S. made up about 5% of Jinko’s sales in the quarter, it said in its investor call.
In addition to solar products, tariffs were also making it prohibitively expensive to sell battery storage systems to the U.S., Jinko told investors.
Meanwhile, CSI Solar, a NASDAQ-listed subsidiary of China’s Canadian Solar, plans to accelerate the relocation of manufacturing to low-tariff regions and is negotiating with major clients and suppliers to reasonably share tariff costs, it said in a filing with the U.S. Securities and Exchange Commission on Monday.
At the same time, CSI said it was preparing for potential U.S.-China negotiations and the adjustment of tariffs to a more reasonable range, while also pursuing tariff exemptions for some products.
Citizens Bank just gave businesses a less risky way to share their financial data
Citizens Bank is headquartered in Rhode Island but has branches across the United States.Getty Images
Banks can face security risks when customers share their financial data using third parties.
Citizens Bank built a tool designed to let clients securely and efficiently share data.
This article is part of “Build IT: Connectivity,” a series about tech powering better business.
Banking customers often share their financial data on external platforms, such as budgeting tools and accounting software, to help them manage their money.
But for financial institutions, giving out that data can come with security risks.
One popular way to transfer banking data to other applications is “screen scraping,” in which a bank’s customers share their login credentials with a third-party app that then mimics user behavior to pull financial data onto the external platform.
Taira Hall, the head of enterprise payments strategy at Citizens Bank, told Business Insider the practice poses several risks to customers. Cybercriminals can exploit the third-party app to gain access to the customer’s account, and the screen scraping software may misread data and display outdated or inaccurate information.
To address these issues, Citizens built an open banking API, or application programming interface, a type of technology that allows software to “plug in” and access data from other software.
The tool is designed to let customers securely access their financial data, such as balances and recent transactions, on external platforms without the need for screen scraping.
Taira Hall is the head of enterprise payments strategy at Citizens Bank.Courtesy of Citizens Bank
The new tool relies on the concept of open banking, an idea that emerged in the early 2000s when online banking became more common. In its most basic form, open banking allows customers to share their financial data with service providers other than their bank.
Today, sharing data for consumers via open banking API is standard. Citizens’ API, however, allows commercial customers to do the same.
Ravi de Silva, the CEO of De Risk Partners, a consortium of financial consulting firms, told BI that open banking creates a foundation for more personalized, efficient, and transparent financial services.
“Instead of locking customer data inside a single institution, open banking empowers individuals to use their own data to access better lending options, budgeting tools, and other financial services,” said de Silva, who was the global head of compliance testing at Citigroup before founding De Risk Partners. “It shifts the balance of control toward the consumer, not the institution.”
Citizens’ commercial customers, such as stores, restaurants, and business service providers, may use open banking data to automate expense tracking or verify income for gig workers, while other banks can use the data to assess borrower risk in real time instead of relying on credit scores. The API provides access to a wide range of financial data in one place, allowing customers to easily gather information from sources like invoices and payrolls.
“Normally, commercial customers need to go through time-consuming and complicated processes involving paperwork and implementation in order to get their data from bank to external platform,” Hall said. “But with the open banking API, all that’s needed is linking their Citizens accounts from within the external platform, and the data starts to flow automatically.”
Other banks, such as Deutsche Bank and Wells Fargo, have also developed opening banking APIs for their commercial customers.
Citizens’ API uses a data aggregator as a middle layer between the bank and the external platform. Instead of the bank connecting to each individual platform, it connects to a central data aggregator that can then transmit customer data, once the customer has given permission.
Hall said the API removed the need for clients to work with anyone from Citizens to share their data. It also eliminated the security risks associated with practices such as screen scraping.
The API was built largely in-house through a collaboration between Citizens’ technology, product, risk, legal, and cyber teams. Hall said the primary challenges were getting the tech to work and forming relationships with the companies that aggregate the data.
Hall said the API had seen “significant” use both by consumers and business clients since it launched in March. She added that the bank had also seen a 95% reduction in screen scraping, which they measured by tracking how often financial data aggregators accessed their website.
Looking ahead, de Silva said open banking would most likely evolve beyond checking and savings accounts to include data from pensions, mortgages, and investments.
“We may also see deeper integration of AI that turns financial data into predictive insights, helping consumers make smarter decisions about their money,” he said.
“And as privacy regulations mature, we’ll likely see a shift toward greater consumer ownership and portability of their financial identity.”
Meta to report first quarter earnings as tariff, antitrust fears loom
Social media giant Meta (META) will report its first quarter results Wednesday as Wall Street looks for clarity on the impact of President Trump’s reciprocal tariffs on US businesses.
Meta’s report comes after rival Google (GOOG, GOOGL) announced its own earnings last week, beating on both the top and bottom lines on the strength of its ad sales.
During that company’s investor call, Google CBO Philipp Schindler said it was too early to comment on the potential economic impact on the current quarter, but did mention that the Trump administration’s changes to de minimis exemptions will cause “a slight headwind to [Google’s] ads business in 2025.”
The de minimis exemption lets companies ship items under $800 to the US without having to pay a duty. That, Schindler explained, will have a particular impact on Google’s APAC-based retail customers.
For the quarter, Meta is expected to report earnings per share (EPS) of $5.25 on revenue of $41.3 billion, according to Bloomberg consensus estimates. The company saw EPS of $4.71 on revenue of $36.4 billion in Q1 2024.
Advertising revenue is expected to top out at $40.5 billion, while Meta’s Reality Labs segment is set to report an operating loss of $4.5 billion and revenue of $496 million.
Meta’s stock price is down more than 5% since the start of the year.
NasdaqGS – Nasdaq Real Time Price•USD
As of 2:00:45 PM EDT. Market Open.
“We attribute weakness to [Meta’s] greater exposure to advertising (no cloud business for [Meta]) and China-based advertisers (>10% exposure for [Meta]) who have reportedly pulled back on ad spend,” Jefferies analyst Brent Thill wrote in an investor note.
In his own note, BofA Securities analyst Justin Post said he expects to see a modest beat on Q1 revenue but believes the company will offer a more conservative guide for the second quarter.
Meta’s earnings come as the company is battling the Federal Trade Commission (FTC) in court over claims the social media company holds an illegal monopoly over the “personal social networking.”
The FTC is looking to force Meta to sell off both Instagram and WhatsApp as a remedy. The commission claims Meta originally purchased the apps as part of a “buy-or-bury” campaign to fight off potential competitors.
According to the Wall Street Journal, CEO Mark Zuckerberg offered to settle with the FTC for $450 million. The commission, however, asked for $30 billion. Zuckerberg eventually raised his offer to $1 billion, but the FTC would only go as low as $18 billion.
Zuckerberg has met with President Trump several times over recent months as he seeks to develop a closer relationship with the president. For instance, the CEO attended Trump’s inauguration in January, and Meta donated $1 million to Trump’s inauguration fund.
MQ) In The Context Of Other Finance and HR Software Stocks
Wrapping up Q4 earnings, we look at the numbers and key takeaways for the finance and hr software stocks, including Marqeta (NASDAQ:MQ) and its peers.
Organizations are constantly looking to improve organizational efficiencies, whether it is financial planning, tax management or payroll. Finance and HR software benefit from the SaaS-ification of businesses, large and small, who much prefer the flexibility of cloud-based, web-browser delivered software paid for on a subscription basis than the hassle and expense of purchasing and managing on-premise enterprise software.
The 14 finance and hr software stocks we track reported a mixed Q4. As a group, revenues beat analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was 1.4% below.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 11.6% since the latest earnings results.
Founded by CEO Jason Gardner in 2009, Marqeta (NASDAQ:MQ) is an innovative card issuer that provides companies with the ability to issue and process virtual, physical, and tokenized credit and debit cards.
Marqeta reported revenues of $135.8 million, up 14.3% year on year. This print exceeded analysts’ expectations by 3%. Overall, it was a very strong quarter for the company with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ total payment volume estimates.
“In 2024, we empowered our customers to achieve significant growth and scale, maintaining both stability and compliance,” said Mike Milotich, Interim CEO at Marqeta.
Marqeta Total Revenue
Interestingly, the stock is up 13.9% since reporting and currently trades at $3.97.
Founded by industry veterans Aneel Bushri and Dave Duffield after their former company PeopleSoft was acquired by Oracle in a hostile takeover, Workday (NASDAQ:WDAY) provides cloud-based software for organizations to manage and plan finance and human resources.
Workday reported revenues of $2.21 billion, up 15% year on year, outperforming analysts’ expectations by 1.3%. The business had a very strong quarter with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ billings estimates.
Workday Total Revenue
The stock is down 5.8% since reporting. It currently trades at $240.40.
Originally created to process international tuition payments for universities, Flywire (NASDAQ:FLYW) is a cross border payments processor and software platform focusing on complex, high-value transactions like education, healthcare and B2B payments.
Flywire reported revenues of $117.6 million, up 22.4% year on year, falling short of analysts’ expectations by 4.9%. It was a softer quarter as it posted revenue guidance for next quarter slightly missing analysts’ expectations.
Flywire delivered the fastest revenue growth but had the weakest performance against analyst estimates in the group. As expected, the stock is down 49.4% since the results and currently trades at $8.92.
Founded in 2010, Workiva (NYSE:WK) offers software as a service product that makes financial and compliance reporting easier, especially for publicly traded corporations.
Workiva reported revenues of $199.9 million, up 19.9% year on year. This result topped analysts’ expectations by 2.4%. Taking a step back, it was a mixed quarter as it also logged an impressive beat of analysts’ EBITDA estimates but full-year EPS guidance missing analysts’ expectations significantly.
Workiva scored the highest full-year guidance raise among its peers. The company added 129 enterprise customers paying more than $100,000 annually to reach a total of 2,055. The stock is down 12.4% since reporting and currently trades at $73.32.
One of the oldest service providers in the industry, Paychex (NASDAQ:PAYX) offers its customers payroll and HR software solutions.
Paychex reported revenues of $1.51 billion, up 4.8% year on year. This print met analysts’ expectations. More broadly, it was a mixed quarter as it underperformed in some other aspects of the business.
Paychex had the slowest revenue growth among its peers. The stock is flat since reporting and currently trades at $144.73.
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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Oil falls as economic jitters dampen demand outlook
(Reuters) – Crude oil prices fell in early Asian trading on Tuesday as investors lowered their demand growth expectations due to the ongoing trade war between the United States and China, the world’s two biggest economies.
Brent crude futures fell by 25 cents, or 0.4%, to $65.61 per barrel by 0024 GMT. U.S. West Texas Intermediate crude futures fell 18 cents, or 0.3%, to $61.87 a barrel. Both benchmarks fell more than $1 on Monday.
U.S. President Donald Trump’s push to reshape world trade by imposing tariffs on all U.S. imports has created a high risk that the global economy will slip into a recession this year, according to a majority of economists in a Reuters poll.
China, hit with the steepest of those tariffs, has responded with its own levies against U.S. imports, stoking a trade war between the top two oil consuming nations. That has prompted analysts to sharply lower their oil demand and price forecasts.
Barclays on Monday cut its 2025 Brent crude price forecast by $4 to $70 a barrel, citing elevated trade tensions and a pivot in production strategy by the OPEC+ group as drivers of a 1 million barrel per day oil supply surplus this year.
Several members of OPEC+, which comprises the Organization of the Petroleum Exporting Countries and its allies, will suggest an acceleration of output hikes for a second consecutive month in June, sources told Reuters last week.
“A substantial (oil) price decrease appears probable if exporting countries boost production,” oil analyst Philip Verleger said in a note.
Meanwhile, U.S. crude oil stockpiles likely rose by about 500,000 barrels in the week ended April 15, according to a preliminary Reuters poll of analysts on Monday.
Industry group American Petroleum Institute will publish its estimates on U.S. oil inventories on Tuesday. Official figures from the Energy Information Administration will follow on Wednesday. [API/S] [EIA/S]
(Reporting by Shariq Khan in New York; Editing by Sonali Paul)
Apple to report second quarter earnings as tariff uncertainty clouds Big Tech outlook
Apple (AAPL) will report its second quarter earnings after the bell on Thursday as Wall Street looks for early signs of the impacts of President Trump’s tariffs on the iPhone maker. The company is expected to report higher earnings but may be wary of its prospects for the rest of the year.
The second quarter wrapped up in late March, and because Trump held his tariff announcement on April 2, the full breadth of the duties’ effects may not come into view until Apple’s third quarter. Still, Q2 could provide a hint at what to expect in the coming quarters.
Apple stock is down 16% year to date but up 23% over the past 12 months.
Trump initially slapped China-produced goods with a 145% tariff, which could have sent Apple iPhone prices soaring. But Trump has since exempted devices like smartphones and computers from the duties.
Read more about Apple’s stock moves and today’s market action.
Follow Yahoo Finance’s special coverage of Apple’s earnings after the bell on May 1. ·Yahoo Finance
According to Reuters, Apple worked to get ahead of the tariffs by shipping 600 tons of iPhones from India to the US. The company is also leaning more heavily on its India operations for devices destined for America because that country faces a lower 26% reciprocal tariff versus China. According to the Financial Times, Apple hopes to eventually source all US iPhones from India.
But the Trump administration hasn’t ruled out the potential for future tariffs on those goods. The White House is currently working on a plan for duties on semiconductors and has said those could also apply to things like smartphones and computers.
Read more: The latest news and updates on Trump’s tariffs
“We don’t think Apple is ‘out-of-the-woods’ yet,” KeyBanc analyst Brandon Nispel wrote in an investor note. “We continue to see consensus expectations as too high for [Apple], particularly looking out to FY26, which calls for an accelerating growth profile.”
For the first quarter, Apple is expected to report earnings per share of $1.62 on revenue of $94.2 billion, according to Bloomberg consensus estimates. That would be an increase from the same period last year, when Apple saw EPS of $1.53 on revenue of $90.7 billion.
But Apple’s iPhone revenue is expected to decline to $45.6 billion in Q2 from $45.9 billion in Q2 last year. Wall Street anticipates the company will make up for the drop with improvements in Mac, iPad, wearables, and services revenue.
For the quarter, the company is expected to see Mac and iPad revenue of $7.7 billion and $6.1 billion, respectively. That’s up from $7.4 billion and $5.5 billion in Q2 2024. Wearables will bring in $8 billion, compared to $7.9 billion last year. Apple’s services revenue is set to come in at $26.7 billion, compared to $23.8 billion in Q2 2024.
Wall Street will be looking to see whether Apple will provide forward guidance for the coming quarters. While Big Tech peer Google (GOOG, GOOGL) offered a relatively positive outlook for its current quarter during its earnings report last week, Intel (INTC), citing trade issues, posted worse-than-expected guidance, sending shares tumbling.
Analysts will also be watching Apple’s revenue out of China during its earnings announcement. Sales in the region have fallen in recent quarters, but analysts expect the trend to flip in Q2, with sales set to improve to $16.8 billion from $16.3 billion.
Analysts have pinned the decline in China revenue on everything from Chinese consumers opting for homegrown devices from the likes of Xiaomi and Huawei to Apple’s struggles to get its Apple Intelligence platform off the ground in the country.
Apple is also dealing with AI delays in the US. The company was expected to launch a generative AI-powered version of its Siri personal assistant before its upcoming WWDC event in June but has pushed that back due to delays in getting the software together.
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Email Daniel Howley at dhowley@yahoofinance.com. Follow him on Twitter at @DanielHowley.
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BL) And The Rest Of The Finance and HR Software Segment
Earnings results often indicate what direction a company will take in the months ahead. With Q4 behind us, let’s have a look at BlackLine (NASDAQ:BL) and its peers.
Organizations are constantly looking to improve organizational efficiencies, whether it is financial planning, tax management or payroll. Finance and HR software benefit from the SaaS-ification of businesses, large and small, who much prefer the flexibility of cloud-based, web-browser delivered software paid for on a subscription basis than the hassle and expense of purchasing and managing on-premise enterprise software.
The 14 finance and HR software stocks we track reported a mixed Q4. As a group, revenues beat analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was 1.4% below.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 12.2% since the latest earnings results.
Started in 2001 by software engineer Therese Tucker, one of the very few women founders who took their companies public, BlackLine (NASDAQ:BL) provides software for organizations to automate accounting and finance tasks.
BlackLine reported revenues of $169.5 million, up 8.8% year on year. This print exceeded analysts’ expectations by 0.6%. Despite the top-line beat, it was still a slower quarter for the company with full-year EPS guidance missing analysts’ expectations.
“We believe our recent user conference and accelerating innovation are creating momentum for BlackLine,” said Owen Ryan, Co-CEO of BlackLine.
BlackLine Total Revenue
The stock is down 26.5% since reporting and currently trades at $46.56.
Founded by industry veterans Aneel Bushri and Dave Duffield after their former company PeopleSoft was acquired by Oracle in a hostile takeover, Workday (NASDAQ:WDAY) provides cloud-based software for organizations to manage and plan finance and human resources.
Workday reported revenues of $2.21 billion, up 15% year on year, outperforming analysts’ expectations by 1.3%. The business had a very strong quarter with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ billings estimates.
Workday Total Revenue
The market seems unhappy with the results as the stock is down 6.2% since reporting. It currently trades at $239.30.
Originally created to process international tuition payments for universities, Flywire (NASDAQ:FLYW) is a cross border payments processor and software platform focusing on complex, high-value transactions like education, healthcare and B2B payments.
Flywire reported revenues of $117.6 million, up 22.4% year on year, falling short of analysts’ expectations by 4.9%. It was a softer quarter as it posted revenue guidance for the next quarter, slightly missing analysts’ expectations.
Flywire delivered the fastest revenue growth but had the weakest performance against analyst estimates in the group. As expected, the stock is down 51% since the results and currently trades at $8.64.
Founded in 1990 in Cincinnati, Ohio, Paycor (NASDAQ: PYCR) provides software for small businesses to manage their payroll and HR needs in one place.
Paycor reported revenues of $180.4 million, up 13.1% year on year. This number beat analysts’ expectations by 1.9%. However, it was a slower quarter as it logged a significant miss of analysts’ EBITDA estimates.
The stock is up 1.6% since reporting and currently trades at $22.49.
Created from the merger of two small workforce management companies in 2007, Asure (NASDAQ:ASUR) provides cloud based payroll and HR software for small and medium-sized businesses (SMBs).
Asure reported revenues of $30.79 million, up 17.2% year on year. This print met analysts’ expectations. Aside from that, it was a slower quarter as it produced EBITDA guidance for next quarter missing analysts’ expectations.
The stock is down 3.8% since reporting and currently trades at $9.32.
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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SINGAPORE (Reuters) – Oil prices inched up in early trade on Monday but remained dogged by uncertainty over trade talks between the U.S. and China clouding the outlook for global growth and fuel demand, while the prospect of OPEC+ raising its supply cast more gloom.
Brent crude futures and U.S. West Texas Intermediate crude nudged higher for a third session, up 9 cents by 0025 GMT to $66.96 and $63.11 a barrel, respectively.
“Absence of news is pushing oil prices modestly higher as traders are positioned short ahead of potential increased OPEC+ supply from the May 5 meeting and a significant production boost in the USA,” Michael McCarthy, chief executive officer of online trading platform Moomoo Australia.
Some members of the Organization of the Petroleum Exporting Countries and their allies, known as OPEC+, are expected to suggest that the group accelerates oil output hikes for a second consecutive month when they meet on May 5.
Expectations of oversupply and concerns about the impact of tariffs on the global economy caused Brent and WTI to fall by more than 1% last week.
The market has been rocked by conflicting signals from U.S. President Donald Trump and Beijing over what progress was being made to de-escalate a trade war that threatens to sap global growth.
In the latest comment from Washington, U.S. Treasury Secretary Scott Bessent on Sunday did not back Trump’s assertion that negotiations with China were under way. Earlier, Beijing denied any talks were taking place.
Many participants in the International Monetary Fund and World Bank Spring Meetings said Trump’s administration was still conflicted in its demands from trading partners hit with his sweeping tariffs.
Investors are also watching nuclear talks between Iran and the United States in Oman which continue this week. Iranian Foreign Minister Abbas Araqchi said he remained “extremely cautious” about the success of the negotiations.
In Iran, a powerful explosion at its biggest port of Bandar Abbas has killed at least 40, with more than 1,200 people injured, state media reported on Sunday.
On Sunday, top officials in the Trump administration pressed Russia and Ukraine to make headway on a peace deal following a one-on-one meeting between Trump and Ukrainian President Volodymyr Zelenskiy at the Vatican a day earlier.
(Reporting by Florence Tan; Editing by Sonali Paul)
Inside the AI boom that’s transforming how consultants work at McKinsey, BCG, and Deloitte
AI is changing how consulting companies work.Tyler Le/BI
Consulting firms are rapidly adopting AI tools to enhance efficiency and innovation.
Firms say that workers were ambivalent about AI at first.
Now, they say AI has helped workers save time, which they reinvest in more advanced work.
It wasn’t long ago that young consultants at McKinsey & Company would pore over reports to ensure they aligned with the firm’s writing style.
Now, an AI agent called “Tone of Voice” does that.
At Boston Consulting Group, consultants now use a tool called Deckster to reduce the time they spend polishing PowerPoint slides. At Ernst & Young, instead of contacting payroll, consultants can ask a chatbot to explain their pay slips.
Consulting firms are among the early leaders of the generative AI craze. They’re helping other companies train employees, develop new tools, and regulate the technology.
They are also testing generative AI internally, and in just the past two years, they’ve unveiled a new suite of chatbots, agents, and applications that have quickly and quietly changed how consultants do their work.
At McKinsey, consultants are using an in-house generative AI chatbot called Lilli. It synthesizes the firm’s entire body of intellectual property, which spans 100 years and over 100,000 documents and interviews, the firm told BI.
Users enter their requests into Lilli, which aggregates the key points, identifies five to seven relevant internal content pieces, and points users to appropriate experts within the firm. Users can opt to have queries answered by the firm’s internal knowledge repository or external sources.
Lilli’s usage at the firm has exploded since it was first rolled out in 2023. Over 70% of the firm’s 45,000 employees now use the tool. Those who use it turn to it about 17 times a week, McKinsey senior partner Delphine Zurkiya told BI.
When McKinsey first launched Lilli, employees experienced what the firm calls “prompt anxiety,” or uncertainty over what to ask the bot. But it found that just one hour of training improved employee engagement. Zurkiya said the tool has also evolved since its launch. It wasn’t initially designed to parse PowerPoints, where most of the firm’s knowledge exists.
Now, McKinsey consultants told BI they use it for research, summarizing documents, analyzing data, and brainstorming. In a case study published on its website, the firm reported that workers saved 30% of their time using Lilli.
Zurkiya, who describes herself as “one of the heavy users of Lilli,” said she often uses it with teams to identify the right approach to solving client problems. “We almost have AI in the room with us because we are often saying, oh, what does Lilli think,” she said.
Partners at McKinsey told BI that the firm has been developing AI products for years. In 2015, it acquired a data analytics and design company, QuantumBlack, which now serves as McKinsey’s AI consulting arm. It employs 7,000 tech experts across 50 countries.
“About 40% of the work we do is analytics-related, AI-related, and a lot of it is moving to Gen AI,” senior partner Ben Ellencweig told BI last year. McKinsey builds generative AI solutions for clients through an “ecosystem” of alliances with 19 AI companies, including Microsoft, Google, Anthropic, and Nvidia, and has completed over 400 genAI projects for clients.
But the popularity of ChatGPT crystallized the value of a conversational tool, Zurkiya said. “There wasn’t a major shift in our strategy in the sense that we had already been developing a lot of tools internally. It’s just these tools now have become, we’ll say faster, in delivering value thanks to that natural user interface,” she said.
McKinsey consultants do not have access to ChatGPT.
Lilli is just one of several AI tools changing work within the firm. Zurkiya said that AI technology is being deployed at three levels. On an individual level, a platform lets consultants build their own AI agents — technology that, among other things, can solve problems and execute tasks autonomously. Then, there are more domain-specific tools. Agents in the Life Sciences practice, where Zurkiya works, can help consultants get up to speed on specific companies in the sector. There are also firm-wide tools, like new ones for booking meetings and travel.
The firm also applies the lessons from building Lilli to new client projects, developing similar tools that fit their needs.
Despite the hype around genAI tools, consultants don’t seem worried that their jobs could be threatened as a result. Commentators on the anonymous professional networking app Fishbowl who work at McKinsey described its tools as “functional enough” and best for “very low stakes issues.”
Over the last two years, BCG has pushed to train its employees in AI.
In 2023, the firm unveiled ChatGPT Enterprise to all its employees under the stipulation that all data would remain under its control. Since then, the firm’s 33,000 employees have built over 18,000 custom GPTs — tailored versions of ChatGPT — for internal uses from summarizing documents to generating automatic email responses to answering HR-specific questions.
BCG has also developed eight or nine internal generative AI tools, Scott Wilder, partner and managing director, told BI.
One tool it has heavily invested in is Deckster, a slideshow editor, Wilder said. It’s trained on 800 to 900 slide templates and helps consultants quickly create presentations. Wilder said one of Deckster’s most popular features is a “review this” button, which helps junior consultants by grading slides based on best practices used by midlevel managers and leaders. About 40% of associates use Deckster weekly, Wilder said.
The tool has become so popular that some of its consultants are fretting about job security. “BCG folks who’ve tried Deckster: how worried should we be about our jobs? Is it already creating groundbreaking productivity that more junior folks won’t be needed as much?” one consultant wrote on Fishbowl last year.
One of the more experimental tools BCG has unveiled is GENE, a conversational chatbot. The bot is built on top of GPT-4o by ElevenLabs and sports an intentionally robotic voice.
“It’s a deliberate choice, a subtle reminder that I’m an AI, not a human. Keeps expectations in check,” GENE said about its voice during a BCG podcast in December 2023. “Plus it adds a bit of retro charm, doesn’t it?”
GENE also explained that its knowledge base is “built from an extensive collection of BCG’s best thinking on genAI, shaped by conversations with industry experts, articles, and research studies.”
The bot is designed to be a “conversation partner,” the firm said. Consultants have employed it for brainstorming, hosting podcasts, live demonstrations, and are even considering using it to interview partners to create content for the firm. Teams can change the bot’s “temperature” to control the tone of its responses.
BCG also has an internal platform for building AI agents in beta testing.
Amid gloomy narratives of layoffs and robots coming for jobs, Wilder said the firm’s thesis on AI is optimistic. “We will say our goal is to take out the toil and increase the joy,” he said. The firm estimates that employees reinvest about 70% of the time they save into “higher value activities,” he added.
But those time savings also mean the expectations on consultants are in flux. BCG hasn’t changed how it evaluates performance now that it relies so much on genAI tools. However, a spokesperson for the firm told BI it is “thoughtfully considering the role they play as these technologies become more central to how we work.”
At Deloitte, generative AI appears to be more tightly regulated. For one, ChatGPT is blocked from the firm’s internal system, three consultants told BI.
“I think probably what they really are trying to avoid here is analysts or just forgetful people putting something like client data into a generative AI tool,” Andrew Sutton, a senior advisory consultant at the firm, told BI. Sutton, who builds internal AI tools for other consultants at the firm, said they’re required to develop them in secure environments to prevent data leaks.
“If we are using a tool that comes from something like OpenAI, we have special communications and contracts with them,” he said. “The amount of bureaucracy, all that stuff, that we have to go through is insane.”
The firm has its own ChatGPT alternative called Sidekick, which comes with a disclaimer that employees are only allowed to use it for non-client work. Deloitte consultants told BI they use it for summarizing documents, brainstorming, editing emails, and coding.
Deloitte has invested billions into artificial intelligence, however. In March, it unveiled Zora AI, a new fleet of AI agents. The firm says they’re trained in specific subjects — like finance or marketing — and designed to think like humans. Last year, it expanded its digital delivery platform, Ascend, with generative AI capabilities.
Publicly, the firm’s leadership has also rallied around the technology. At Nvidia’s GTC Conference in March, Deloitte principal Jillian Wanner, who leads AI staff development at the firm, acknowledged that the consulting industry is being “disrupted” amid AI transformations. Jim Rowan, head of AI at Deloitte, previously told BI that senior managers should use AI to demonstrate its effectiveness and give employees time to explore the technology.
In a recent statement to BI, Rowan said, “We believe AI is transforming all industries, including our own, ushering in new business models and ways of working, and helping to uncover new sources of business growth and innovation.”
KPMG is taking two-pronged approach to AI adoption, according to its head of ecosystems, Todd Lohr. “I’m a big fan of top down and bottoms up,” Lohr told BI. “It’s really hard to know what hundreds of thousands of people in an organization are doing day to day. But by giving them the technology and letting them use it, they’re coming up with even better and more creative ways than any top down methodology.”
He said people were a bit confused about how to use genAI when the firm started rolling out the technology two years ago.
“I call it swivel chair processing. It’s really hard for people who have been doing tasks for — in some cases — decades to stop what they’re doing,” Lohr said. Since then, the firm has harvested data on how employees are prompting AI. It’s used that information to build new tools, for itself and clients, through retrieval augmented generation — a technique to enhance the specificity and accuracy of large language models — and open data sources, Lohr said.
As consulting firms develop more sophisticating tooling, like platforms for agents, they’ve realized they need hubs to centralize them. KPMG signed an agreement with Google Cloud this month to purchase licenses for Agentspace — a new platform that integrates AI agents with a company’s data — for its US workforce.
Deloitte recently unveiled Agent2Agent, a new platform to improve interoperability between agents. It’s the firm’s largest collaboration with Google Cloud and ServiceNow.
PwC unveiled a similar platform, called agent OS, last month. It helps centralize clients’ agents, and the more than 250 internal ones it has built in the past 18 months. The idea is to convert isolated agents from “ships passing in the night” to “an armada that’s working together,” Matt Wood, PwC’s global and US commercial technology and innovation officer, told BI.
After a post-pandemic dry spell in which many consulting firms struggled with layoffs, lost contracts, and cost-cutting initiatives, generative AI is something of a light at the end of the tunnel — even with the latest scrutiny from Washington.
“My bet is that as more agents become available, organizations will see not just efficiency, but growth,” Wood said. “And that growth will allow them to double down on what is working and will result in larger organizations, not smaller organizations.”
Octopus owner plots mobile network after conquering energy market
Octopus energy sign-in
The multibillion-pound fund that launched Octopus Energy is exploring plans to launch a new mobile network in a move that could radically shake up Britain’s telecoms market.
Octopus Group, which helped to launch Britain’s biggest energy company a decade ago, is plotting an expansion into mobile services to challenge the four, soon to be three, companies that dominate the market.
The move suggests that Octopus is looking to replicate the success of its energy business, which has now overtaken British Gas as the country’s largest household supplier.
The new mobile virtual network operator (MVNO) would not build its own infrastructure but instead piggyback off one of the existing networks run by BT-owned EE, Virgin Media O2, Vodafone and Three.
The UK mobile market is awash with MVNOs, which often try to attract customers with cut-price deals or specialised offers such as data-focused contracts.
However, the majority of these brands are owned four major networks and it has been years since a player outside the telecoms industry has established a foothold in the market.
Superdrug set up its own mobile brand in 2018, while Asda and Tesco launched their mobile offerings in 2007 and 2003 respectively.
Octopus is understood to have approached at least one of the major networks through Fern Trading, a subsidiary that owns a handful of telecoms assets, to discuss a potential tie-up.
The Octopus discussions are believed to be linked to Y Corporation, a little-known mobile company owned by Fern Trading that has a wholesale agreement to use Three’s network.
Sources said Y Corp was now exploring opportunities to offer eSim-only contracts to both business customers and consumers.
The company appointed Adam Dunlop, the former TalkTalk consumer boss, as a director in January to lead the expansion.
Octopus Group was founded in 2000 by Simon Rogerson, Christopher Hulatt and Guy Myles after the trio quit their jobs in asset management in their early 20s.
The company is best known for launching Octopus Energy, which has grown from nothing in 2015 to serve almost 13m customers today. The provider has since been spun out of the group but it remains the largest external shareholder.
Octopus Group has since expanded into a number of different sectors through its investment arm, which manages funds of roughly £10bn for more than 63,000 investors.
It is unclear how the new mobile service will ultimately be branded. However, a new provider under the Octopus brand would allow the group to bundle more services together as it expands its operations across telecoms and utilities.
One insider said the company viewed mobile as “totally complementary” to its existing services and the “missing piece of the puzzle”.
Octopus Energy is known for its customer service and user-friendly interfaces, which are both built upon its proprietary Kraken technology platform. The software is also used by more than 100,000 broadband customers signed up to Cuckoo, a internet provider also owned by the Octopus Group.
Customer service has long been a bugbear of the telecoms industry, with a recent survey by consumer group Which? revealing that the big four providers were largely outshone by their smaller rivals in terms of value for money and customer service.
Octopus’s plans come as the mobile industry gears up for its biggest shake-up in years as Vodafone and Three prepare to combine in a £15bn mega-merger.
The tie-up has ignited a price war as telecoms operators scramble to beef up their value offerings in both mobile and broadband.
Giffgaff, the budget mobile network owned by O2, is trialling a cut-price broadband service while BT is understood to be mulling the launch of a new discount mobile service.
If Y Corp were to maintain its wholesale deal with Three, it would gain access to the UK’s largest mobile network once the merger with Vodafone completes.
Octopus subsidiary Fern also owns a number of full-fibre broadband firms including Cuckoo and AllPoints Fibre.
Fern recently announced plans to merge four of its challenger internet providers, dubbed “alt-nets”, into a single company as the industry braces for a wave of consolidation.
Octopus Energy previously had a foothold in broadband after acquiring Shell’s household energy business in 2023. However, it sold off the broadband business to TalkTalk last year.
We Now Know How AI ‘Thinks’—and It’s Barely Thinking at All
– Daniel Hertzberg
The big names in artificial intelligence—leaders at OpenAI, Anthropic, Google and others—still confidently predict that AI attaining human-level smarts is right around the corner. But the naysayers are growing in number and volume. AI, they say, just doesn’t think like us.
The work of these researchers suggests there’s something fundamentally limiting about the underlying architecture of today’s AI models. Today’s AIs are able to simulate intelligence by, in essence, learning an enormous number of rules of thumb, which they selectively apply to all the information they encounter.
This contrasts with the many ways that humans and even animals are able to reason about the world, and predict the future. We biological beings build “world models” of how things work, which include cause and effect.
Many AI engineers claim that their models, too, have built such world models inside their vast webs of artificial neurons, as evidenced by their ability to write fluent prose that indicates apparent reasoning. Recent advances in so-called “reasoning models” have further convinced some observers that ChatGPT and others have already reached human-level ability, known in the industry as AGI, for artificial general intelligence.
There was no visibility into how they produced the results they did, because they were trained rather than programmed, and the vast number of parameters that comprised their artificial “brains” encoded information and logic in ways that were inscrutable to their creators. But researchers are developing new tools that allow them to look inside these models. The results leave many questioning the conclusion that they are anywhere close to AGI.
“There’s a controversy about what these models are actually doing, and some of the anthropomorphic language that is used to describe them,” says Melanie Mitchell, a professor at the Santa Fe Institute who studies AI.
Melanie Mitchell, a professor at the Santa Fe Institute. – Kate Joyce/Santa Fe Institute
New techniques for probing large language models—part of a growing field known as “mechanistic interpretability”—show researchers the way these AIs do mathematics, learn to play games or navigate through environments. In a series of recentessays, Mitchell argued that a growing body of work shows that it seems possible models develop gigantic “bags of heuristics,” rather than create more efficient mental models of situations and then reasoning through the tasks at hand. (“Heuristic” is a fancy word for a problem-solving shortcut.)
When Keyon Vafa, an AI researcher at Harvard University, first heard the “bag of heuristics” theory, “I feel like it unlocked something for me,” he says. “This is exactly the thing that we’re trying to describe.”
Vafa’s own research was an effort to see what kind of mental map an AI builds when it’s trained on millions of turn-by-turn directions like what you would see on Google Maps. Vafa and his colleagues used as source material Manhattan’s dense network of streets and avenues.
The map of Manhattan that an AI made up in its own ‘mind’ after being trained on millions of turn-by-turn directions, from the paper ‘Evaluating the World Model Implicit in a Generative Model’ by Keyon Vafa, Justin Y. Chen, Ashesh Rambachan, Jon Kleinberg and Sendhil Mullainathan. –
The result did not look anything like a street map of Manhattan. Close inspection revealed the AI had inferred all kinds of impossible maneuvers—routes that leapt over Central Park, or traveled diagonally for many blocks. Yet the resulting model managed to give usable turn-by-turn directions between any two points in the borough with 99% accuracy.
Even though its topsy-turvy map would drive any motorist mad, the model had essentially learned separate rules for navigating in a multitude of situations, from every possible starting point, Vafa says.
The vast “brains” of AIs, paired with unprecedented processing power, allow them to learn how to solve problems in a messy way which would be impossible for a person.
Other research looks at the peculiarities that arise when large language models try to do math, something they’re historically bad at doing, but are getting better at. Some studies show that models learn a separate set of rules for multiplying numbers in a certain range—say, from 200 to 210—than they use for multiplying numbers in some other range. If you think that’s a less than ideal way to do math, you’re right.
All of this work suggests that under the hood, today’s AIs are overly complicated, patched-together Rube Goldberg machines full of ad-hoc solutions for answering our prompts. Understanding that these systems are long lists of cobbled-together rules of thumb could go a long way to explaining why they struggle when they’re asked to do things even a little bit outside their training, says Vafa. When his team blocked just 1% of the virtual Manhattan’s roads, forcing the AI to navigate around detours, its performance plummeted.
This illustrates a big difference between today’s AIs and people, he adds. A person might not be able to recite turn-by-turn directions around New York City with 99% accuracy, but they’d be mentally flexible enough to avoid a bit of roadwork.
This research also suggests why many models are so massive: They have to memorize an endless list of rules of thumb, and can’t compress that knowledge into a mental model like a person can. It might also help explain why they have to learn on such enormous amounts of data, where a person can pick something up after just a few trials: To derive all those individual rules of thumb, they have to see every possible combination of words, images, game-board positions and the like. And to really train them well, they need to see those combinations over and over.
AI researchers have gotten ahead of themselves before. In 1970, Massachusetts Institute of Technology professor Marvin Minsky told Life magazine that a computer would have the intelligence of an average human being in “three to eight years.”
Last year, Elon Musk claimed that AI will exceed human intelligence by 2026. In February, Sam Altman wrote on his blog that “systems that start to point to AGI are coming into view,” and that this moment in history represents “the beginning of something for which it’s hard not to say, ‘This time it’s different.’” On Tuesday, Anthropic’s chief security officer warned that “virtual employees” will be working in U.S. companies within a year.
Even if these prognostications prove premature, AI is here to stay, and to change our lives. Software developers are only just figuring out how to use these undeniably impressive systems to help us all be more productive. And while their inherent smarts might be leveling off, work on refining them continues.
Meanwhile, research into the limitations of how AI “thinks” could be an important part of making them better. In a recent essay, MIT AI researcher Jacob Andreas wrote that better understanding of language models’ challenges leads to new ways to train them: “We can make LMs better (more accurate, more trustworthy, more controllable) as we start to address those limitations.”
Write to Christopher Mims at christopher.mims@wsj.com
These are the hardest companies to interview for, according to Glassdoor
The toughest job interviews usually have multiple rounds.Natee Meepian/Getty Images
Tech giants are known for their challenging interviews.
Google, Meta, and Nvidia top the list of rigorous interviews with multiple rounds and assessments.
But tough questions show up across industries, according to employee reports on Glassdoor.
It’s tough to break into high-paying companies.
Google is notorious for having a demanding interview process. Aside from putting job candidates through assessments, preliminary phone calls, and asking them to complete projects, the company also screens candidates through multiple rounds of interviews.
Typical interview questions range from open-ended behavioral ones like “tell me about a time that you went against the status quo” or “what does being ‘Googley’ mean to you?” to more technical ones.
At Nvidia, the chipmaking darling of the AI boom, candidates must also pass through rigorous rounds of assessments and interviews. “How would you describe __ technology to a non-technical person?” was a question a candidate interviewing for a job as a senior solutions architect shared on the career site Glassdoor last month. The candidate noted that they didn’t receive an offer.
Tech giants top Glassdoor’s list of the hardest companies to interview with. But tough questions show up across industries — from luxury carmakers like Rolls-Royce, where a candidate said they were asked to define “a single crystal,” to Bacardi, where a market manager who cited a difficult interview, and no offer, recalled being asked, “If you were a cocktail what would you be and why?”
The digital PR agency Reboot Online analyzed Glassdoor data to determine which companies have the most challenging job interviews. They focused on “reputable companies” listed in the top 100 of Forbes’ World’s Best Employers list and examined 313,000 employee reviews on Glassdoor. For each company, they looked at the average interview difficulty rating as reported on Glassdoor.
Here’s a list of the top 90 companies that put candidates through the ringer for a job, according to self-reported reviews on Glassdoor.
Google parent Alphabet (GOOG, GOOGL) and chip giant Intel (INTC) kicked off Big Tech’s earnings season on Thursday, with both companies reporting better-than-anticipated results on their top and bottom lines. But it wasn’t all good news.
Both Intel and Google raised the specter of tariffs during their respective reports and the tariffs’ potential impact on their businesses. Despite the Trump administration’s assertions that it is negotiating new trade agreements with various countries, the uncertainty around tariffs and their potential impact on the US economy has companies on edge.
Intel said “the current macro environment” will impact its second quarter revenue, guiding sales of between $11.2 billion and $12.4 billion. Wall Street was anticipating $12.8 billion. Intel’s stock price fell more than 7% Friday.
Google didn’t offer much insight into the impact of tariffs on its second quarter, with CBO Philipp Schindler saying it was too early to comment. He did explain that the Trump administration’s changes to de minimis exemptions will cause “a slight headwind to our ads business in 2025.”
The de minimis exemption lets companies ship items under $800 to the US without having to pay a duty. That, Schindler explained, will have a particular impact on Google’s APAC-based retail customers.
And with Meta (META) and Microsoft (MSFT) set to report their earnings on April 30 and Amazon (AMZN) and Apple (AAPL) scheduled to report on May 1, expect to hear even more about tariffs very soon.
Read more: The latest news and updates on Trump’s tariffs
Intel and Google gave investors their first close look at how tech companies are navigating the impact of tariffs. While Intel builds the majority of its chips in the US, they end up in laptops and desktops built overseas and shipped back to America.
Intel said it saw customers buying up more products in Q1, likely to get ahead of tariffs, but that will likely fall off in Q2, which is why guidance came in short of expectations.
Google was far more tight-lipped about what tariffs will mean for its bottom line next quarter, outside of the de minimis commentary. That said, if tariff concerns begin to force advertisers to pull back on their ad budgets, Google could find itself in trouble.
Read more: What Trump’s tariffs mean for the economy and your wallet
Google is also just one piece of the broader digital advertising market. Meta, Google’s rival in the ad space, and Amazon, which has its own formidable ad business, will provide a far clearer view of how advertisers are responding to tariff threats and offer deeper insights into the coming quarters.
Amazon and Microsoft, meanwhile, will fill investors in on whether tariffs could slow customer spending on AI and cloud services.
Importantly, Apple will provide a look into consumer spending when it reports after the bell on May 1. The company has been shipping iPhones to the US from India to get around Trump’s tariffs on goods from China, and according to Bloomberg, consumers hit stores to buy up new Apple products out of fear that the duties would mean major price increases.
Investors will be on the lookout for any forward guidance on Apple’s tariff plans and whether it will consider raising its prices if Trump pulls exemptions on the company’s goods.
It’s going to be quite a busy week.
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Nintendo stock surges to record high after Switch 2 pre-orders sell out
Nintendo Switch 2 will be playable as a handheld and on your TV.Nintendo
Nintendo stock hit fresh records in trading in Tokyo a day after its US-listed ADRs notched an all-time high.
The rally comes after pre-orders for Nintendo’s Switch 2 console sold out in the US.
The 7% stock price surge catapulted Nintendo’s market value to $92 billion.
The move: Nintendo’s ADR shares surged as much as 7% to $19.82 on Thursday, a record high. The gains continued on Friday, with Japan-listed Nintendo shares popping another 4% higher.
Why: The surge, which catapulted the company’s market value to $92 billion, was sparked by the company’s Switch 2 pre-order window opening up in the US.
And those pre-orders sold out fast.
As of Thursday afternoon, pre-orders were sold out across retailers, including Best Buy, Target, GameStop, and Walmart.
While Nintendo didn’t increase the price of its Switch 2 following the Trump tariffs, it did increase the price of Switch 2 accessories.
What it means: The swift pre-order sellouts indicate massive pent-up demand for the Switch 2 console. The original Switch console was released just over 8 years ago.
While the strong demand may not be too surprising given that the original Switch console was released eight years ago, it is impressive considering the console retails for $450, with most bundles being offered for about $500.
The high price tag and solid sales suggest that even amid concerns of rising inflation and a potential recession, consumers are willing to spend money on indulgences they want.
Analysts at JPMorgan expect the strong sales to continue.
“We think Switch 2’s annual sales volume is likely to be 18 million units, putting it below 20 million units but expect steady build-up over the long term,” JPMorgan’s Junko Yamamura said in a note on Thursday.
Deliveroo gets $3.6 billion buyout proposal from DoorDash
(Reuters) -British meal delivery company Deliveroo said on Friday it had received a proposal from DoorDash on April 5 to buy all of its shares for 2.7 billion pounds ($3.60 billion).
DoorDash will need to make a firm offer for the company by May 23.
In June 2024, DoorDash expressed interest in acquiring Deliveroo, but talks ended due to valuation disagreements.
Doordash did not immediately respond to a Reuters request for comment.
($1 = 0.7508 pounds)
(Reporting by Aatrayee Chatterjee; Additional reporting by Anuja Mistry; Editing by Alan Barona and Devika Syamnath)
