CARR - Wall Street Breakfast Podcast: Adobe Stumbles On Weak Outlook FTC Inquiry

2023-12-14 06:39:48 ET

Summary

• Adobe's stock drops in premarket trading due to weak outlook and FTC inquiry.
• Mattel plans to develop a live-action feature film based on its American Girl doll line.
• Carrier sells its global commercial refrigeration business to Haier for $775 million.

Listen below or on the go on Apple Podcasts and Spotify

Adobe ( ADBE ) stumbles on weak outlook, FTC inquiry. (00:22) Mattel's ( MAT ) American Girl is heading to the big screen after Barbie breakthrough. (01:50) Carrier ( CARR ) offloads global commercial refrigeration operations onto Haier ( HRSHF ) for $775M. (02:50)

This is an abridged transcript of the podcast.

Adobe (NASDAQ: ADBE ) is down 6.1% in premarket trading.

The company issued a weaker-than-expected outlook for the coming year and said it was being probed by the U.S. government about subscription practices.

Looking to fiscal 2024, Adobe ( ADBE ) expects overall fiscal 2024 sales to be between $21.3B and $21.5B, with the mid-point below the $21.74B estimate. Earnings per share are forecast to between $17.60 and $18 per share.

Digital media net new annual recurring revenue is expected to be around $1.9B, the company said.

For the period ending December 1, Adobe ( ADBE ) earned an adjusted $4.27 per share as revenue rose 12% year-over-year to $5.05B.

Analysts were expecting the company to earn $4.14 per share on $5.02B in sales.

In addition, Adobe ( ADBE ) said it received a communication from the Federal Trade Commission in November about its subscriptions. Currently, the San Jose, Calif.-based company is working with the government agency about a possible settlement or resolution on the matter, which it said could "involve significant monetary costs."

Adobe held a conference call to discuss the results.

Mattel (NASDAQ: MAT ) announced that it plans to develop a live-action feature film based on the toy company's iconic American Girl doll line.

American Girl will be distributed by Paramount Pictures (NASDAQ: PARA ) and produced by Mattel Films, Paramount Pictures, and Temple Hill Entertainment.

American Girl was founded in 1986 by Pleasant T. Rowland, a teacher-turned-entrepreneur. She’s described as someone who set out to celebrate girlhood with beautiful dolls and adventurous books. Since debuting in 1986, more than 32M American Girl dolls have been sold.

Mattel Films is on a hot streak following the stunning success of the Barbie movie. The studio has 14 live-action films in the works, including movies based on Hot Wheels, Magic 8 Ball, Polly Pocket, Rock ‘Em Sock ’Em Robots, and UNO.

Shares of Mattel ( MAT ) closed with a 2.21% gain on Wednesday, while Paramount Global ( PARA ) gained 3.01%.

Carrier (NYSE: CARR ) will sell its global commercial refrigeration business to its longtime joint venture partner Haier for an enterprise value of $775 million, the company said Wednesday.

The sale also includes about $200 million of net pension liabilities.

Carrier said the net proceeds from the sale would exceed $500 million and expects to use it to reduce debt.

The transaction is expected to close in the second half of 2024.

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On our catalyst watch for the day,

• Regeneron Pharmaceuticals ( REGN ) will host a conference call to provide an update on the company's hematology portfolio.

• Intel ( INTC ) will hold its AI Everywhere Event. The semiconductor giant said the event will include the launch of 5th Gen Intel Xeon processors for data centers and Intel Core Ultra processors for laptops.

Wall Street's major averages on Wednesday ended solidly higher.

Market participants took the Federal Reserve's updated dot plot and comments from chair Jerome Powell as a confirmation that the central bank was done hiking rates and may even start cutting soon.

For more detailed analysis on the FOMC’s announcement check out Wednesday's Wall Street Lunch with Kim Khan .

The Dow ( DJI ) advanced 1.40% to settle above the 37K mark for the first time, smashing a previous intraday record high and a closing high. The Nasdaq ( COMP.IND ) gained 1.38%, while the S&P 500 ( SP500 ) climbed 1.37%.

All 11 S&P sectors ended in the green.

Treasury yields plummeted after the updated dot plot and Powell's remarks. The 2-year yield ( US2Y ) tumbled 30 basis points to 4.43%. The 10-year yield ( US10Y ) was down 19 basis points to 4.02%.

Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are in the green. The Dow is up 0.25%, the S & P 500 is up 0.25% and the Nasdaq is up 0.35%. Crude oil is up 2% at nearly $71 per barrel. Bitcoin is up 4.7% and just below $43,000.

In the world markets, the FTSE 100 is up 2.2% and the DAX is up 0.8%.

The biggest movers for the day premarket: Ocular Therapeutix (NASDAQ: OCUL ) is down 17% following a public offering of 30.8M shares at $3.25 per share, below the current price of $3.94.

On today’s economic calendar:

• 8:30 am The retail sales report for November will be released. Economists forecast a 0.2% month-over-month increase after stripping out the gas and auto categories.

• 10 am business inventories

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