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NEW YORK — U.S. stock indexes edged lower Oct.
30 after drops for Eli Lilly and chip companies overshadowed a jump for Google's parent company. The S&P 500 slipped 0.3 percent after drifting between small gains and losses several times, though it's still near its all-time high set earlier this month.
The Dow Jones Industrial Average edged down 0.2 percent, while the Nasdaq composite slipped 0.6 percent from its own record set the day before.
Alphabet climbed 2.8 percent after beating profit forecasts for profit in the latest quarter, thanks largely to the performance of its Google business. Among computer chip companies, Advanced Micro Devices helped drag down stocks across the industry after reporting its profit for the latest quarter that only matched expectations.
AMD's stock sank 10.6%. Nvidia, a chip giant that's rocketed to become one of Wall Street's largest most influential stocks, fell 1.
4 percent and was one of the heaviest weights on the S&P 500. Super Micro Computer lost nearly a third of its value, after Ernst & Young resigned as its registered public accounting firm. A prominent investor, Hindenburg Research, published a report in August that accused the company of accounting red flags and other issues, which CEO Charles Liang later said contained false or inaccurate statements.
INDIANAPOLIS — Eli Lilly is dialing back its 2024 forecast after underwhelming Wall Street with third-quarter profit and sales from two key drugs that missed expectations. The drugmaker on Oct. 30 chopped a few dollars off its earnings guidance for the year after raising that forecast well beyond previous forecasts.
Its stock fell 6.3 percent. Overall, Lilly earned $970 million, and adjusted results totaled $1.
18 per share, while revenue climbed 20 percent to $11.44 billion. Analysts expected earnings of $1.
45 per share on $12.09 billion in revenue, according to FactSet. Sales of the diabetes treatment Mounjaro and weight loss counterpart Zepbound were hurt in the quarter as U.
S. pharmaceutical wholesalers whittled inventory they had built ups. Lilly also booked higher research and development and marketing, selling and administrative expenses in the quarter.
The company brought in $3.1 billion in sales from Mounjaro and another $1.3 billion from Zepbound, which hit the U.
S. market nearly a year ago. TD Cowen analyst Steve Scala said sales of both drugs missed expectations, and he wanted to learn more about whether the drop was a "temporary flattening or new trend.
" For the full year, Lilly now forecasts adjusted earnings to range between $13.02 and $13.52 per share.
The company had predicted more than $16 per share in August, which was more than $2 higher than consensus at the time. Analysts now expect adjusted earnings of $13.42 per share.
SAN FRANCISCO — Microsoft Corp. reported an 11 percent profit increase for the July-September quarter compared to the same time last year as investors looked for signs that the company's huge spending on artificial intelligence is paying off. The company said Oct.
3- that net income totaling $24.7 billion, or $3.30 per share, which beat Wall Street expectations.
The Redmond, Wash.-based software maker posted revenue of $65.6 billion in the quarter, up 16 percent from last year.
Analysts polled by FactSet Research were expecting Microsoft to earn $3.10 per share on revenue of $64.6 billion.
Microsoft doesn't report revenue specifically from AI products but says it has infused the technology and its AI assistant, called Copilot, into all of its business segments, particularly its Azure cloud computing contracts. Leading in sales for the quarter was Microsoft's productivity business segment, which includes its Office suite of email and other workplace products, growing 12 percent to $28.3 billion.
Microsoft's cloud-focused business segment grew 20% from the same time last year to $24.1 billion for the three months ending Sept. 30.
Its personal computing business, led by its Windows division, grew 17 percent to $13.2 billion. SAN FRANCISCO — Meta Platforms Inc.
posted stronger-than-expected third-quarter results on Oct. 30 fueled by its advertising revenue growth and its push to incorporate artificial intelligence. But the Instagram and Facebook parent warned that it expects a "significant acceleration" in infrastructure spending next year as it continues to pour money into developing AI.
For the three months ended on Sept. 30, the company earned $15.69 billion, or $6.
03 per share, up 35 percent from the same period a year earlier. Revenue rose 19 percent to $40.59 billion.
Analysts, on average, were expecting earnings of $5.22 per share on revenue of $40.21 billion, according to FactSet Research.
"We had a good quarter driven by AI progress across our apps and business," CEO Mark Zuckerberg said in a statement. "We also have strong momentum with Meta AI, Llama adoption, and AI-powered glasses." For the current quarter, Meta is forecasting revenue of $45 billion to $48 billion.
Analysts are expecting $46.18 billion. BERLIN — Volkswagen said significant cost cuts are urgently needed as it reported a steep decline in third-quarter earnings on Wednesday and faced employee representatives angry at the possibility of the automaker's first plant closures in Germany.
The company reported net profit of $1.7 billion for the July-September period, a 64 percent from a year earlier. Revenue was only marginally lower, slipping 0.
5 percent. The figures came two days after the head of VW's works council said management had informed employee representatives that it wants to close at least three plants in Germany. The company hasn't publicly detailed its plans.
VW said in early September that industry headwinds mean it can't rule out plant closures in its home country. It cited factors including new competitors entering European markets and economically stagnant Germany's deteriorating position as a manufacturing site. European automakers are facing increased competition from inexpensive Chinese electric cars.
NEW YORK — Shares of Super Micro Computer plunged more than 30% by midday Wednesday, after the server maker disclosed that Ernst & Young had resigned as its public accounting firm. According to an Oct. 30 filing from Super Micro, EY resigned while conducting an audit for the tech company's most recent fiscal year.
The accounting firm communicated concerns in July over issues like transparency and internal control related to financial reporting, the filing notes, later prompting Super Micro's board to enlist a review. Additional information received during this review then led EY to raise questions about whether Super Micro "demonstrates a commitment to integrity and ethical values," the company added, as well as transparency and oversight independent of the CEO and other management. The Associated Press reached out to EY for statement Wednesday.
Super Micro's regulatory filing notes EY's resignation letter stated, in part, that it would "no longer be able to rely" on representations from the company's management and audit committee — and concluded it could no longer provide audit services "in accordance with applicable law or professional obligations." EY sent its resignation letter last week, per Wednesday's filing, which noted that the company's review is ongoing. The audit would've been the EY's first on Super Micro's behalf.
In a statement, Super Micro said that it disagreed with EY's decision to resign — and was now "working diligently" to select new auditors. The company added that it does not expect "a resolution of the matters raised by (EY)" to result in any restatements of previous-reported quarterly financial results, and will provide a business update next week. The accounting firm's resignation arrives just two months after short-selling firm Hindenburg Research released a report alleging ample accounting manipulation at Super Micro, pointing to "glaring accounting red flags" and evidence of undisclosed transactions.
It also accused Super Micro of rehiring top executives that were directly involved in a 2018 scandal. At the time of August's report, Super Micro said it would not comment "on rumors and speculation." Following these accusations, The Wall Street Journal reported last month that the Justice Department was beginning a probe into Super Micro, citing people familiar with the matter.
Back in 2020, the Securities and Exchange Commission also charged Super Micro with improper accounting for "prematurely recognizing revenue and understating expenses" beginning at least as early as fiscal 2015 to 2017. The company paid a $17.5 million civil penalty.
Super Micro has been among tech companies recently riding a the artificial intelligence wave. Despite the company's recent plummet, shares are still up about 17% year to date. In August, Super Micro reported fourth-quarter revenue of $5.
31 billion, a more than 143% increase over the $2.18 billion it reported in the same quarter of 2023. NEW YORK — For the first time in its nearly 20-year history, Reddit is turning a profit.
The social platform claimed a gain of $29.9 million, or 16 cents per share, for the period ending in September, and reported sales of $348.4 million, surpassing the $312.
8 million analysts had projected. Reddit also grew its number of daily users to 97.2 million, a 47 percent increase from the same time last year, the company said Reddit CEO Steve Huffman said its new AI translation feature — which allows readers to convert posts between English, French, Spanish, Portuguese, Italian and German — was a primary driver of user growth, especially internationally.
Huffman wrote that Reddit plans to expand the feature to more than 30 countries going into 2025. While the company's advertising remains its main source of revenue, Reddit's earnings summary notes its recent data licensing agreements are beginning to pay off financially. Both Google and OpenAI have signed deals with Reddit to train their artificial intelligence models on its content.
NEW YORK — Starbucks is discontinuing its Oleato olive-oil infused beverages at most locations, part of an effort to streamline the chain's menu. The Seattle-based company confirmed the change Oct. 30 ahead of the release of its quarterly earnings.
Starbucks said it will no longer offer Oleato drinks beginning in early November at most stores. They will be available at some locations in Italy, Japan and China. The decision breaks a link to Starbucks' longtime leader Howard Schultz, who came up with the idea after visiting an olive oil producer in Sicily.
Schultz called the beverage a "transformational idea" when he introduced it in Italy in early 2023. It went on sale in the U.S.
earlier this year. But Schultz stepped down as CEO in March 2023 and left the company's board last fall. Since then, Starbucks' sales have fallen as consumers push back on high prices and employees struggle with the chain's increasingly complex menu.
PARIS — Saudi startup airline Riyadh Air has ordered 60 Airbus aircraft, the European aerospace manufacturer said Oct. 30. The carrier plans to begin passenger flights next summer and has placed an order for 60 A321neo planes, the largest among Airbus' best-selling A320neo family, the company said in a statement.
The creation of Riyadh Air by the Saudi sovereign wealth fund is part of a broader Saudi strategy to diversify its oil-based economy and boost tourism. Saudi Arabia hopes to become a global aviation hub and attract 100 million annual visitors by 2030. Earlier this year, Riyadh Air and Delta Air Lines announced they had entered into a partnership with the goal of operating flights between the United States and Saudi Arabia.
The airline, along with Saudi Arabia flag carrier Saudia, announced in March last year a shared order for 78 jetliners from Boeing Co. and options to buy 43 more. The deal includes up to 72 787 Dreamliners to be built in North Charleston.
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