Thursday's Headlines: It’s Not a Match For Bumble and Investors

Thursday's Headlines: It’s Not a Match For Bumble and Investors

Here were the biggest movers in the MyWallSt shortlist yesterday:

Moving Up ⬆️

2U (TWOU) +6.1%

Meta (META) +5.2%

Evolent Health (EVH) +4.1%

Chegg (CHGG) +3.6%

Planet Fitness (PLNT) +2.5%

Moving Down ⬇️

Baozun (BZUN) -16.5%

Stitch Fix (SFIX) -13.8%

Walt Disney Co. (DIS) -13.2%

Sea Limited (SE) -13.0%

Redfin (RDFN) -12.1%

Here are the stories that you need to know ahead of market-open today, Thursday the 10th of October.

It’s Not a Match For Bumble and Investors 🐝

Shares of online dating platform Bumble (BMBL) took a significant tumble following its third-quarter earnings report yesterday after the bell. A disappointing forecast for the crucial upcoming holiday period, coupled with underperforming revenue had shareholders swiping left, with Bumble currently down close to13% premarket.

Bumble posted earnings per share of $0.14 on revenue of $232.6 million, against analyst estimates of $0.01 and $237.4 million respectively. This marks quite the earnings boost from the loss of $0.06 per share in the year-ago quarter, while revenue also saw a noticeable increase year-over-year.

However, investors’ hopes for a resurgence for the app were quelled upon hearing the company’s guidance for the upcoming quarter. Revenue of between $232 million and $237 million is expected, whereas analysts had been anticipating closer to $254 million. These muted figures suggest a distinct lack of sales growth across the holiday quarter — quite a worrying prospect for the firm.

CEO Whitney Wolfe Herd lamented the fact that “some of our user segments are facing greater pressure on disposable income, and these segments are renewing their subscriptions at a modestly lower rate.” Other causes for concern include the increased competition from chief rival Match Group, the lasting effects of the war in Ukraine, and the current strength of the U.S. Dollar.

Bumble is currently down over 40% year-to-date and sits over 72% off all-time highs witnessed shortly after its February 2021 IPO. While there are plenty of reasons behind this, including the widespread rotation away from growth and tech stocks, shareholders are still likely to remain concerned.

Rivian Reaffirms Production Target, Plans to Cut Costs ⚡️

Shares of Rivian are trading higher this morning premarket after the EV-maker reiterated its production target for 2022. Management also plans to achieve it while spending less. Its goal of producing 25,000 vehicles remains intact after last night’s earnings report, and investors were buoyed by the decision to reduce capital expenditures to $1.75 billion from $2 billion.

The most pertinent thing to come out of last night’s call is the step-up in production volume that the company is forecasting. This is thanks to adding a second shift of workers at its manufacturing plant in Illinois. Having produced 7,363 vehicles in the quarter, and 14,317 year-to-date, to meet its 25,000 quota for the year, it expects to see a significant increase in output for Q4. With its preorder list now topping 111,000, on top of a 100,000 vehicle order from Amazon to boot, the pressure is on to start delivering to its customers.

It was not all roses for Rivian, however, with revenue of $536 million in the quarter falling short of analysts’ expectations. A net loss of $1.7 billion was also much wider than the Street had bargained for. However, thanks to a cash pile of almost $14 billion that management expects will last til 2025, these losses are going to be par for the course for some time yet, with a full-year adjusted EBITDA loss of $5.4 billion forecast for this year.

Rocket Lab Doesn’t Have a Problem 🚀

In premarket trading, Rocket Lab has popped almost 2% thanks to a solid third quarter.

Rocket Lab is an American aerospace manufacturer and launch service provider focused on lightweight orbital rockets. These have become increasingly popular due to the surge in small satellites. More and more companies and governments need help developing and getting their tech into space and Rocket Lab provide these services. In the coming years, Rocket Lab hopes to develop a large Neutron rocket that will have a maximum payload of 8 tons, 25 times its current capabilities. Rockets of this size will draw the company into direct competition with SpaceX.

In Q3, Rocket Lab generated $63.1 million in revenue, up 14% from the quarter before, and saw an adjusted EBITDA loss of $6.9 million, 62% less than a year ago. It conducted three successful launches from its New Zealand facility, bringing in $23 million in revenue, while it made $40.1 million from its spacecraft and component business.

In exciting news, management announced that the company will launch its first rocket from NASA’s Wallops facility in Virginia next month and will have a second launch early next year. Rocket Lab also expanded its contract with MDA, the developer of the Globalstar satellite constellation that provides connectivity for Apple’s latest generation of iPhones. This was in addition to new contracts signed with the Pentagon.

Rocket Lab forecasts lower revenue for Q4, between $51 and $54 million, due to the delay of an unspecified launch until 2023.

Rocket Lab’s stock is down 61% so far this year.

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