Earnings Previews: Activision Blizzard, Lyft

The three major U.S. equity indexes closed lower again Thursday. The Dow Jones industrials ended the day down 0.46%, the S&P 500 closed 1.06% lower and the Nasdaq fell 1.73%. Six of 11 sectors closed lower, with technology (−3.00%) and communications services (−2.83%) posting the biggest losses. Energy (2.04%) was the leading gainer.

Friday morning’s report on nonfarm payrolls for October showed that 261,000 new jobs were added last month, well above the consensus estimate of 220,000 and well below the revised September total of 315,000. The headline unemployment rate rose from 3.5% to 3.7%.

The three major indexes traded mixed in Friday’s premarket session. The Dow was higher while the S&P 500 and Nasdaq both were slightly lower.

After U.S. markets closed Thursday, Block reported better-than-expected earnings per share (EPS) and revenue results. Shares gapped up in Friday’s premarket.

Carvana missed on both the top and bottom lines. The company did not issue guidance but did say that economic headwinds are likely to continue and that Carvana will have to “rapidly decrease expenses.” Shares traded down about 15% early Friday.

Coinbase also missed EPS and revenue estimates, but the company’s outlook for the coming fiscal year included a comment about managing expenses. Shares gapped up Friday morning.

PayPal beat estimates on both the top and bottom lines but issued revenue guidance below estimates. Shares gapped down in Friday’s premarket.

Starbucks beat estimates on both the top and bottom lines and reaffirmed full-year guidance. Shares traded up more than 5.5% early Friday.

Before markets opened Friday morning, Cardinal Health reported solid beats on both the top and bottom lines. The outlook for fiscal 2023 (ending in September) was in line with expectations. Shares traded up 1.7% early Friday.

DraftKings reported a smaller loss for the quarter than the loss in the prior year quarter, but improved guidance was not good enough. Shares traded down about 17.5% in Friday’s premarket.

We already have previewed Ballard Power, NiSource and Palantir Technologies, all scheduled to report quarterly results first thing Monday morning.

Here is a preview of two companies set to report quarterly results later on Monday.

Activision Blizzard

Since Microsoft made an all-cash offer of $95 per share (about $70 billion) for interactive game maker Activision Blizzard Inc. (NASDAQ: ATVI), the company’s stock has risen by about 5.4% and trades about $13 per share below Microsoft’s offering price. The stock jumped to its 52-week high the day the offer was made, before sinking to a recent low in mid-October.

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