Stocks Climb as Unemployment Claims Jump Ahead of Jobs Report

Lamb Weston Stock Sinks After Software Issue Affects Q3 Results, FY Outlook

35 minutes ago

Shares of Lamb Weston Holdings (LW) plunged 20% in intraday trading Thursday as the potato processor posted lower-than-expected quarterly profit and sales, and warned about full-year results because of problems with a new software system.

Lamb Weston reported third-quarter adjusted earnings per share (EPS) of $1.20, with revenue up 16% to $1.46 billion. Both were short of forecasts.

Chief Executive Officer (CEO) Tom Werner blamed the shortfall on a slower-than-anticipated transition to a new enterprise resource planning (ERP) system in North America, which he said “negatively impacted our financial results in the quarter by more than we expected.” 

Lamb Weston said the residual effects led the company to revise its outlook. It now sees full-year adjusted EPS in a range of $5.50 to $5.65, down from the previous estimate of $5.70 to $6.15. It predicts revenue of $6.54 billion to $6.60 billion, lowered from the earlier estimate of $6.80 billion to $7.00 billion.

The news sent Lamb Weston shares tumbling 20% to about $81, their lowest level in a year and a half.

–Bill McColl

Levi Strauss Stock Pops as Jeans Maker Lifts Earnings Guidance

1 hr 15 min ago

Shares in Levi Strauss & Co. (LEVI) jumped Thursday after the maker of jeans delivered a better-than-expected quarterly earnings report and raised its full-year profit guidance as it ramps up its direct-to-consumer (DTC) business.

For the three months ending Feb. 25, the company’s first quarter, Levi reported adjusted earnings of 26 cents per share, a nickel ahead of the 21 cents a share expected by analysts.

The company’s DTC sales through its website and namesake branded stores grew 7% from a year earlier and made up 48% of the apparel maker’s total revenue, reducing reliance on its wholesale business, which saw sales decline 18% in the quarter.

Turning to the outlook, the company lifted its bottom-line forecast and now expects to earn between $1.17 and $1.27 per share on an adjusted basis, up from its earlier projection of $1.15 to $1.25 a share. By comparison, Wall Street had forecast earnings of $1.21 a share.

Levi shares were up 16% at $21.63 as of midday Thursday. With today’s gains, the stock has risen more than 30% so far this year.

–Timothy Smith

HubSpot Stock Jumps Amid Reports Alphabet Considering Acquisition

2 hr 29 min ago

Shares of HubSpot (HUBS) jumped in early trading Thursday amid reports Google parent Alphabet (GOOGL) was considering making an offer to buy the marketing software company. 

Alphabet has met with investment bankers at Morgan Stanley in recent days to discuss a potential offer, Reuters reported Thursday, citing people familiar with the discussions. The company has also discussed with advisors whether antitrust regulators would be likely to challenge an acquisition. 

The deal, if offered, would be one of the few examples of a tech giant attempting a tie-up under the enhanced scrutiny of President Joe Biden’s tech-skeptical regulators. Federal Trade Commission (FTC) Chair Lina Khan has made going after big tech a cornerstone of her tenure. 

Regulators aggressively fought Microsoft’s (MSFT) acquisition of Activision Blizzard, which ultimately took nearly two years and major concessions to complete. And in August, the FTC along with 17 states sued Amazon (AMZN), alleging it used illegal monopolistic practices to stifle competition and inflate prices.

HubSpot shares jumped nearly 8% to a more than two-year high of about $676 Thursday morning. Alphabet shares were down about 1%.

Google Reportedly Considering Putting Some AI Search Features Behind Paywall; Stock Slips

3 hr 22 min ago

Alphabet’s (GOOGL) Google is reportedly considering charging for some artificial intelligence-powered (AI) search features, in what would mark the first time the tech giant has moved its core search product behind a paywall.

Some of Google’s products have premium features like increased cloud storage or more advanced models of the Gemini AI chatbot, but selling ads has long been the primary revenue draw for its search engine. Now, the tech giant is considering trying to take advantage of its search dominance by adding certain AI search features to its existing premium subscription programs, according to a Financial Times report.

Google did not immediately respond to a request for comment, but told the FT that the company is “not working on or considering” creating an ad-free search experience, but that it will “continue to build new premium capabilities and services to enhance our subscription offerings across Google.”

Alphabet’s stock price was down about 1.4% in early trading Thursday. Shares have gained 9% so far this year, and 46% in the last 12 months as it has benefitted from the AI boom.

–Aaron McDade

Stocks Making the Biggest Moves Premarket

4 hr 11 min ago

Gains:

• Levi Strauss & Co. (LEVI): Shares of the jeans maker jumped 13% after it reported better-than-expected first-quarter earnings and raised its full-year profit guidance.
• Conagra Brands Inc. (CAG): Shares of the packaged food maker rose more than 4% after beating earnings estimates on slightly higher-than-expected sales. 
• Ford Motor Co. (F): Shares of the carmaker rose nearly 2% after it said it would delay some electric vehicle production to focus on hybrids, after reporting yesterday a 7% increase in deliveries thanks to robust hybrid and SUV demand. 

Losses:

• Lamb Weston Holdings Inc. (LW): Shares of the packaged food company fell 11% after its quarterly earnings fell short of Wall Street estimates. 
• Block Inc. (SQ): Shares of the fintech slipped 3% after analysts at Morgan Stanley downgraded the stock to underweight. 
• Alphabet Inc. (GOOGL): Shares slid about 1% amid reports subsidiary Google is considering putting some artificial intelligence search features behind a paywall.

Stock Futures Climb After Rough Start to Q2

4 hr 33 min ago

Futures contracts connected to the Dow Jones Industrial Average were up 0.4% in premarket trading on Thursday.

S&P 500 futures rose 0.5%.

Nasdaq 100 futures traded 0.6% higher about an hour before markets opened.