Wall Street closes higher; Netflix, Tesla, Meta report mixed earnings
US stocks rose on 22 October, with the Dow up 360 points. Netflix fell over 5% after weak revenue forecasts. Tesla beat profit estimates but revenue fell short. Meta topped expectations and raised AI spending plans.
Wall Street's three major indexes closed higher on Wednesday 22 October, with the Dow Jones Industrial Average finishing near its session high at 52,856 points, up 360 points or nearly 0.7 per cent. The Nasdaq Composite rose 278 points, or about 1.1 per cent, to 26,702, while the S&P 500 gained 44 points, or almost 0.6 per cent, to 7,757.
Netflix fell more than 5 per cent after it released a full-year revenue forecast that fell short of market expectations and lowered its annual advertising revenue guidance. Other large technology stocks moved in different directions: Alphabet dropped nearly 2 per cent, Apple rose over 1 per cent, and Nvidia gained more than 2 per cent. International Business Machines (IBM) climbed nearly 4 per cent, making it the biggest percentage gainer among Dow components.
Tesla closed more than 3 per cent higher before reporting quarterly results after the bell. Adjusted earnings per share came in at US$0.48, above the market estimate of US$0.45. Revenue was roughly flat year-on-year at US$28.05 billion, slightly below expectations, dragged down by lower vehicle selling prices and a year-on-year decline in deliveries. Free cash flow turned positive as expected, while capital expenditure was well below forecasts. Tesla shares fell nearly 2 per cent in extended trading.
Meta reported quarterly earnings per share of US$3.83 and revenue of US$64.6 billion, up 26 per cent, both beating expectations. The company raised the lower end of its full-year capital expenditure forecast, increasing investment in artificial intelligence. Meta's board also approved the creation of a new publicly traded, non-voting Class C common stock, effective 19 January next year. Meta shares rose nearly 4 per cent in after-hours trading.