Oh, it was quite a whirlwind week for investors.
A billionaire tech co-founder came out swinging against fellow wealthy people in business.
The 10-year yield closed above 4% on Thursday, sparking fears on a higher cost of borrowing soon impacting stocks and the economy.
AMC's CEO Adam Aron touted the release of its new movie theater popcorn at 2,600 Walmart stores.
And one of the favorite tickers of the Yahoo Finance community — tech outfit Nvidia — surprisingly under-performed the S&P 500 despite a ton of AI hype following Tesla's mid-week investor day and revenue/earnings beats out of C3.ai.
Amidst all of this rapid action, here's some stuff you probably missed.
Benioff Brings It
With his back against the wall amid an unprecedented fight with five activist investors as reported by Yahoo Finance's Allie Garfinkle, Salesforce's billionaire co-founder and CEO Marc Benioff brought the heat on his Wednesday evening earnings call.
Benioff promised significantly higher profit margins, more focus on cost controls, no more big acquisitions (for now) while also uncorking a new $20 billion stock buyback plan.
Benioff was excited as I have ever seen him when coming on with us here at Yahoo Finance.
"We have hit the hyper-space button," Benioff told me, referring to initiatives to move faster and improve profitability.
Wall Street analysts noticed that button smash down.
"The combination of growth upside with significant margin expansion and favorable shareholder rhetoric (disbanding M&A group+increased buyback+moderating SBC) is something we simply haven't seen from the Ohana," Citi analyst Tyler Radke said.
The Retail Inventory Bulge Eases
After dealing with inventory bulges (and subsequent markdowns) since mid-2022 brought on by a consumer spending slowdown for products such as apparel and TVs, retailers got their act together in the fourth quarter. Earnings reports this week from Best Buy, Abercrombie & Fitch and others showed major improvement in inventory levels — setting the stage for better profit margins later in 2023 (provided the economy doesn't tank).
A few notable retailers this week that showed 4Q inventory declines year over year:
Target: -3% (more on the quarter here from CFO Michael Fiddelke)
Abercrombie & Fitch: -4% (more on the quarter here from CEO Fran Horowitz)
Best Buy: -14%
Nordstrom: -15.2%
Key quote on retailer inventory:
“Everybody has a (fight) plan until they get punched in the face”. That is a quote attributed to former boxing champ Mike Tyson, which we believe is helpful to keep in mind as we assess retailers’ fight to get inventories clean. Now that we are 70% through the retail earnings season, it is a good time to check on the progress retailers/brands are making. The data are mixed, though we believe the news is more good than bad, as many retailers are making progress consistent with their plan of getting inventory growth more inline with sales growth. But given that sales growth is a moving target, Mike Tyson’s words of wisdom might suggest (which we believe is relevant to the current situation) ‘what if retailers get punched in the face with sales growth that is below forecast." — Citi retail analyst Paul Lejuez
Tesla Investor Day = Flop, Kind Of?
The EV maker's hotly anticipated investor day left much to be desired, reports Yahoo Finance's Pras Subramanian.
No introduction of a new $25,000 car. No super grand plans to crush surging EV entrants GM and Ford. Just a lot of droning on by the world's richest person, Elon Musk.
Tesla shares finished the week down about 3% compared to a slight gain for the S&P 500.
Morgan Stanley analyst Adam Jonas — a long-time Tesla bull — did his best hype job post the company's investor day.
"Tesla's audacious efforts on vertical integration are about to pay off. EVs are far too expensive today. Tesla gave a number of drivers for a 50% cost reduction for its next-gen platform. In a race to the bottom, we seriously question how the competition can keep up," Jonas crowed.
Brian Sozzi is Yahoo Finance's Executive Editor. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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