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US stocks were mixed on Thursday in anticipation of Amazon’s (AMZN) quarterly results, as investors assessed the earnings season so far and eyed President Donald Trump’s fast-moving policy overhaul.
The Dow Jones Industrial Average (^DJI) fell 0.3%. The S&P 500 (^GSPC) rose more than 0.3%, and the tech-heavy Nasdaq Composite (^IXIC) popped 0.5% on the heels of two winning days in a row for the major gauges.
The tariff jitters that shook stocks earlier in the week may have eased, but markets are tracking incoming earnings for any company warnings. At the same time, tech- and chip-related results are being scrutinized for signals about the strength of AI demand.
Investors were keenly awaiting Amazon’s quarterly report due after the bell following Alphabet’s (GOOG, GOOGL) cloud sales flop. The tech giant provided worse than anticipated first quarter sales guidance, sending shares down about 3%.
In other corporate news, Salesforce (CRM) stock slipped following the software giant’s announcement on management changes. Honeywell (HON) shares fell after the conglomerate confirmed it will split into three companies.
Meanwhile, Treasury Secretary Scott Bessent relieved some pressure on the Federal Reserve, saying Trump wants to bring down 10-year Treasury yields to ease borrowing costs rather than push for lower interest rates. The benchmark yield (^TNX) traded around its lowest levels since December, at about 4.43%.
On the economic front, jobless claims jumped to 219,000 last week, slightly above estimates of 213,000. The reading came ahead of the monthly jobs report on Friday as investors search for clues to Fed decision making amid the risk of an uptick in inflation.
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Amazon’s revenue forecast disappoints, stock slides
Yahoo Finance’s Dan Howley reports:
Amazon (AMZN) reported its fourth quarter results after the bell on Thursday, beating on the top and bottom lines, but provided worse-than-anticipated Q1 guidance. Shares of Amazon fell on the news.
Amazon’s earnings come after cloud rivals Microsoft (MSFT) and Google (GOOG, GOOGL) missed on expectations for cloud sales in the quarter. Microsoft posted revenue of $40 billion, with Wall Street anticipating $41.1 billion, and Google reported sales of $11.9 billion. Analysts were looking for $12.1 billion.
Both companies blamed their cloud misfires on a lack of capacity to meet demand for AI services.
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Nvidia pops more than 3% as stocks rally
Nvidia (NVDA) shares rose more than 3% on Thursday as stocks closed higher. The rally extended gains from the past several sessions as the chip giant’s stock is now up more than 10% over the past three days.
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AI mentions are at an all-time high on earnings calls
Artificial intelligence hype is alive and well among S&P 500 (^GSPC) companies.
In a research not published on Thursday, Goldman Sachs chief US equity strategist David Kostin noted the share of companies mentioning AI during this quarter’s earnings calls reached a new high at 50%.
Kostin also added that thus far in the first quarter, the companies benefitting from the AI narrative has begun to shift from the AI infrastructure companies, like chipmakers, to companies that are using AI software to boost revenues. Goldman pointed out companies like Accenture (ACN), Adobe (ADBE) and Meta (META) have seen recent stock rallies as they are “starting to capitalize off their AI investments, deploying tools internally and into their products, allowing employees and customers to benefit.”
Yahoo Finance detailed how this shift could be a key trend in markets headed into 2025.
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Ford falls more than 7% after muted guidance
Yahoo Finance’s Pras Subramanian reports:
Ford (F) reported a fourth quarter earnings and revenue beat, with full-year profit coming in slightly higher than expected, but the company issued muted full-year guidance. The results come after rival GM (GM) reported strong results but declined to return more cash to shareholders.
Ford said it sees full-year 2025 adjusted EBIT of $7 billion to $8.5 billion and adjusted free cash flow of $3.5 billion to $4.5 billion. Ford said the guidance “presumes headwinds related to market factors,” such as pricing, though that does not include changes in policy like the potential loss of EV tax credits or tariffs. CFO Sherry House added in a call with reporters that a 25% tariff on imports “would have a major impact on our industry.”
For comparison, Ford reported 2024 adjusted EBIT of $10.2 billion on revenue of $185 billion and net income of $5.9 billion. Last quarter, Ford guided 2024 adjusted EBIT “to be about $10 billion.”
Ford stock dropped more than 7% at the market open, hitting its lowest level since January 2021.
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Apple supplier Skyworks stock plummets as iPhone maker turns to competitor
Apple (AAPL) supplier Skyworks Solutions (SWKS) saw its stock drop more than 23% Thursday as the semiconductor firm said that it’s losing business with the iPhone maker to one of its competitors, which analysts believe to be Broadcom (AVGO).
Skyworks makes chips used in Apple devices that are crucial for wireless communication. According to the company, Apple accounted for 72% of its roughly $1 billion in revenue for the December quarter. And 85% of that revenue from Apple was from sales of Skyworks components for Apple’s iPhone.
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Tariff threat on lumber poses risks to builders’ margins
President Donald Trump’s planned tariff on imports from Canada could lead to pricier lumber, impacting homebuilders’ margins.
Lumber futures (LBR=F) are currently trading at $583 per thousand board feet. As the National Association of Home Builders notes, a 25% tariff on softwood lumber products from Canada, in addition to the existing 14.5% duty rate, would increase the overall effective rate for the Canadian tariff to nearly 40%.
Canada, the biggest foreign supplier of lumber to the US, has already encountered tariffs after claims of unfair pricing. That has raised lumber costs, created market uncertainty, and prompted builders to diversify their sources. Still, logging in the US has declined over the past few years amid a mismatch between on-the-job risk and wages.
“Rising framing lumber costs, should tariffs roll out on March 4, 2025, will likely reduce housing starts, worsen affordability challenges for buyers, and increase margin headwinds for homebuilders,” Ana Garcia, equity research analyst at CFRA Research, wrote in a note to clients.
According to Garcia’s analysis, the builders able to scale and mitigate the pressure shock include DR Horton (DHI), Lennar (LEN), PulteGroup (PHM), and NVR (NVR). Even with primarily domestic lumber sourcing, price pressures are expected to impact the market, especially smaller homebuilders. For instance, Meritage Homes (MTH) could face additional pressure.
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Americans looking for work haven’t had it this hard in almost 3 years
American workers are taking longer to find jobs.
Data from the Labor Department out Thursday showed 1.89 million continuing weekly unemployment insurance claims were made during the week ending Jan. 25, up from the 1.86 million the week prior and near their highest level of the past three years. This shows more Americans are remaining unemployed for longer and continuing to claim unemployment benefits.
While the number of new Americans filing for weekly claims remains near its lowest level of the past year, reflecting a low layoff environment, economists have argued the elevated level of continuing claims shows it’s becoming increasingly challenging for workers to find a new job.
Oxford Economics chief US economist Ryan Sweet said workers’ current perception of the labor market depends on their employment status.
“Conditions are challenging for those who are unemployed or not in the labor force but want a job,” Sweet wrote in a note to clients on Thursday.
The Federal Reserve has recently acknowledged the growing challenges for workers in the labor market too.
“It’s a low-hiring environment,” Fed Chair Jerome Powell said in a press conference on Jan. 29. “So if you have a job, it’s all good. But if you have to find a job, the job finding rate, the hiring rates have come down.”
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Dow drops 150 points, weighed by shares of Honeywell, Salesforce
The Dow Jones Industrial Average (^DJI) was down more than 150 points on Thursday, weighed by shares of Salesforce (CRM) and Honeywell (HON).
Conglomerate Honeywell said it would split into three separate companies, a move anticipated by Wall Street after pressure from activist investor Elliott Management. The stock slid more than 5%.
Salesforce fell more than 5% after the software giant announced a management change with the creation of a new role that combines two big positions into one.
Starting on March 21, lead independent board director Robin Washington will become president and chief operating and financial officer (COFO).
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Arm, Qualcomm stocks fall as investors wait for AI to drive new demand for smartphones, PCs
Yahoo Finance’s Laura Bratton reports:
Arm Holdings (ARM) and Qualcomm (QCOM) stocks each fell more than 4% Thursday as their quarterly results showed signs the AI boom isn’t yet driving a surge in demand for the consumer devices powered by the companies’ chips.
Despite their above-forecast quarterly earnings results the day prior, investors signaled they aren’t so patiently waiting to see if artificial intelligence will drive a new wave of demand for consumer devices that rely on the companies’ chips.
Read more here.
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Why the labor market could be the only hope for another Fed rate cut
Yahoo Finance’s Alexandra Canal reports:
President Trump’s back-and-forth trade policy has created added uncertainty among investors still searching for clarity on the Federal Reserve’s next move, with tariffs muddying the inflation outlook.
But some on Wall Street think the labor market, not inflation, is the place to look for better clues on what could push the Fed to cut rates later this year. Just look at what happened in September, when the central bank delivered a jumbo 50 basis point cut, largely to protect the jobs market after the unemployment rate unexpectedly jumped.
“The number one risk remains an inflection higher in the unemployment rate, which is the key macro data for the foreseeable future,” Citi analyst Stuart Kaiser wrote in reaction to last week’s Fed decision.
Read more here.
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Roblox tumbles 13% as key metrics disappoint Wall Street
Roblox (RBLX) stock tumbled as much as 30% before paring losses on Thursday, falling after the video game platform missed key quarterly metrics.
The company’s daily active users for the fourth quarter came in at 85.3 million, short of estimates for 88.39 million. Hours engaged also came in light, at 18.7 billion versus expectations for 19.42 billion.
The stock pared losses in early trading, declining 13% by 10:40 a.m. ET.
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Tesla stock extends losses, down more than 2%
Tesla stock (TSLA) sank more than 2% on Thursday and was on track to extend losses for a second day in a row.
Shares of the EV giant came under pressure after automaker Ford (F) issued muted full-year guidance.
The declines from Tesla on Wednesday came after news its Germany sales plunged 59% in January, adding to concerns that CEO Elon Musk’s involvement in politics there could be turning off potential buyers.
Tesla’s stock is down more than 9% year to date but is still up roughly 45% since Election Day on Nov. 5 as Musk backs President Donald Trump.
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Trending tickers on Thursday
Peloton (PTON)
The bike maker’s stock soared 23% as quarterly sales came in better than expected, thanks in part to its seasonal partnership with Costco (COST).
“Our new seasonal partnership with Costco drove more Bike+ unit sales than any other third-party retail partner during Q2,” the company said in a letter to shareholders.
Peloton’s operating expenses were down 25% year over year. The company raised its full-year guidance range for adjusted EBITDA and free cash flow.
Qualcomm (QCOM)
Shares of Qualcomm were down 5% on Thursday after the chipmaker’s quarterly earnings came in better than expected. But guidance for its licensing business disappointed Wall Street.
Qualcomm (QCOM) said it expected revenue from its licensing business to come in between $1.25 billion and $1.45 billion for the second quarter, compared to analyst expectations of $1.4 billion.
Honeywell (HON)
Shares of Honeywell fell 4% on Thursday after the conglomerate ended months of speculation by announcing it would split into three listed companies: Honeywell Automation, Honeywell Aerospace, and Advanced Materials.
The automation business will stay focused on building that technology, while aerospace is dedicated to tech for plane cockpits. And Advanced Materials covers solutions for sectors such as healthcare.
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Stocks open higher as earnings pour in
US stocks rose on Thursday as investors digested company earnings and awaited e-commerce giant’s Amazon (AMZN) results due after the bell.
The Dow Jones Industrial Average (^DJI) and the S&P 500 (^GSPC) both rose more than 0.2%. The tech-heavy Nasdaq Composite (^IXIC) moved above the flat line on the heels of two winning days in a row for the major gauges.
Among the major movers on Thursday, Ford (F) shares slid as the automaker warned of lower profits if tariffs were to be implemented on Canada and Mexico.
Shares of Peloton (PTON) soared 23% after the fitness equipment maker posted better-than-expected sales, thanks in part to its seasonal partnership with Costco (COST).
Disappointing results from chipmakers Arm (ARM) and Qualcomm (QCOM) weighed on those shares.
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Eli Lilly reports mixed earnings, increases 2025 guidance
Yahoo Finance’s Anjalee Khemlani reports:
Eli Lilly (LLY) reported fourth quarter and full year earnings for 2024 on Thursday, with results largely beating Wall Street estimates, sending its stock slightly higher in pre-market trading. But the company missed on GLP-1 sales.
The pharma giant has had a few hits and misses in the past few months. Its GLP-1 tirzepatide drugs were removed from the FDA drug shortage list, which shuts down compounding pharmacy knockoffs. But it also revised down its fourth quarter 2024 guidance last month, ahead of the earnings release.
Read more here.
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Europe stocks rise, FTSE 100 surges after BOE rate cut
Stocks in Europe and the UK moved higher on Thursday as investors welcomed a wave of earnings reports and an interest-rate cut from the Bank of England.
London’s FTSE 100 index (^FTSE) climbed 1.6% after the UK central bank reduced its key rate as expected to 4.5%, its lowest level in 20 months. The BOE’s first easing in three months came after a cooling in inflation.
Meanwhile, the pan-European Stoxx 600 (^STOXX) benchmark advanced 0.7%, setting its sights on a fresh record close. Germany’s DAX (^GDAXI) rose 0.9%, and the CAC (^FCHI) in Paris moved up 1%.
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Good morning. Here’s what’s happening today.
Economic data: Challenger jobs cuts (year-over-year, January); Initial jobless claims (week ending Feb. 1)
Earnings: Amazon (AMZN), Eli Lilly (LLY), Affirm (AFRM), e.l.f. Beauty (ELF), Bristol Myers Squibb (BMY), ConocoPhillips (COP), Hershey (HSY), Peloton (PTON), Pinterest (PINS), Philip Morris International (PM), Roblox (RBLX), Tapestry (TPR), Yum! Brands (YUM)
Here are some of the biggest stories you may have missed overnight and early this morning:
The Elon Musk-Sam Altman feud is turning into a long legal war
Honeywell to break up into three companies: WSJ reports
Trump, Musk are setting up a fight around a Watergate-era law
The biggest factor that could break the stable labor market
Musk ‘buyout’ taken by 40,000 federal workers as deadline nears
Bessent: Trump wants lower 10-year yields, not Fed cuts
Arm stock slides after chip firm dials down FY sales forecast
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Oil prices return from losses with Saudi price increase
Oil prices are pulling back from a heavy sell-off after Saudi Arabia’s state oil company set a steep rise in March oil prices.
Futures saw an immediate change in price, with Brent crude futures (BZ=F) coasting up $0.14 to $74.75 a barrel and West Texas Intermediate (CL=F) crude rising $0.18 to $71.21 a barrel.
Reuters reports:
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