The latest Market Talks covering Equities. Published exclusively on Dow Jones Newswires throughout the day.
1656 ET - Tesla is facing pressure from a limited supply of batteries, the electric-car maker says. Tesla says battery availability "continued to be a limiting factor in increasing auto volumes in the quarter." In the third quarter, total production was up 4% year-over-year, thanks to an increase in Model 3/Y production, while auto sales fell 3% to $20.56 billion. The company is expanding battery manufacturing capacity and securing future supply to try to make do. (katherine.hamilton@wsj.com)
1634 ET - Losses from Reality Labs, Meta's virtual and augmented reality division, are declining but remain high in absolute terms. The company projects that the division will turn a loss this year of between $18 billion and $19 billion, with that loss expected to narrow to around $15 billion in 2027. The division, once the centerpiece of CEO Mark Zuckerberg's long-term vision for the company, had around 10% of its staff laid off earlier this year as part of the company's pivot toward AI. "We remain focused on improving Reality Labs profitability and expect losses to narrow next year to around $15 billion as we reallocate investment toward other priority areas, primarily AI," the company says. (elias.schisgall@wsj.com)
1629 ET - Meta's board has approved a new class of non-voting Class C stock for the company to raise capital for its AI spending without jeopardizing CEO Mark Zuckerberg's control over the company. Meta says the new shares, effective in January, will help support the "significant" investments the company plans to make to capitalize on the AI transformation. "The Special Committee concluded that Mr. Zuckerberg is best suited to lead Meta into its next era and beyond," the company says. "The creation of the Class C common stock will continue the founder-led model that has driven the company's success since its inception." The company plans to pay out a one-time dividend of one Class C share for each outstanding Class A and Class B share. (elias.schisgall@wsj.com)
1622 ET - Meta Platforms bumps up its estimated capital expenditures for this year to a range of $135 billion to $145 billion, lifting the low end of the range by $5 billion. The company declines to share specific guidance for 2027, but says it expects to "continue investing aggressively to support both our core business and emerging AI initiatives." Meta also says its compute capacity is enough to allow for flexibility between growing the core business, developing new products, and training its foundation AI models. The company also projects "strong overall revenue growth throughout 2027," boosted by its new AI products and the impact of AI on its core business. (elias.schisgall@wsj.com)
1508 ET - Major Gulf stock markets end mixed, with Saudi Arabia's Tadawul All Share Index falling 0.3% and Abu Dhabi's benchmark declining 0.6%. Dubai's index rises 0.4%, while Qatar's QE Index gains 0.5%. The divergence suggests investors are becoming more selective, assessing individual markets and sectors rather than taking a uniform regional view, says Milad Azar, market analyst at XTB MENA. Recovering oil exports offer some reassurance, but uncertainty over shipping routes and regional security continues to weigh on risk appetite, he says. Prolonged disruptions could affect corporate margins, tourism, real estate and foreign investment, while earnings and geopolitical developments will be key to market direction in the coming weeks, Azar says. (farhan.rafid@wsj.com)
1436 ET - There may not have been widespread layoffs in Canada to date but economic pressures and U.S. tariffs are taking a toll on workforce decisions, an employer survey by law practice Littler finds. Responses from 200 in-house lawyers, C-suite executive and human resources leaders shows 77% taking at least one workforce-related action in response to business or economic pressures over the past year. Paused or reduced hiring is the most common response, cited by 46% of respondents, followed by layoffs or job cuts and then the increased use of automation or AI to reduce labor needs, Littler says. Tariff-related disruption is playing a role, with 84% of respondents saying such disruptions played a role in influencing a workforce decision and 54% noting they contributed to a moderate or large extent. (robb.stewart@wsj.com; @RobbMStewart)
1411 ET - Celestica is set to capture larger market share and higher spending dollars from major hyperscalers, according to TD Cowen's John Shao. The reason, Shao says, is due to major structural shift in AI and cloud networking architectures, as hyperscalers shift from traditional top-of-rack setups to dedicated switching trays and racks to handle Ethernet for Scale-Up Networks, known as ESUN. Shao says that ESUN is gaining more traction among cloud providers, driving a "proliferation in switch count" per rack that expands Celestica's addressable market. What's more, he thinks it has "strong potential to become a parallel, open standard to Nvidia's proprietary NVLink for non-GPU interconnects." (adriano.marchese@wsj.com)
1320 ET - Netflix's growth outside of the U.S. could be a reason for investors to buy the dip, Deutsche Bank says in a note. Analyst Bryan Kraft believes Wall Street is too focused on a decline in time spent on the streaming platform in the U.S. Internationally, content has performed better, and Netflix's management acknowledged the need for better strategy on U.S. content. Commentary on churn, international viewership, new content and long-term growth were all encouraging, Kraft says. Netflix is down 4.4%. (katherine.hamilton@wsj.com)
1311 ET - Netflix is in need of better U.S. content, Raymond James analysts say. Management acknowledged the need for better content execution in the U.S., with an emphasis on producing more major titles capable of attracting global audiences. Netflix hasn't yet proven that it can effectively turn around the U.S. content, however, analysts Andrew Marok and Jorge Garces say in a note. Netflix's recent appointment of a new chief content officer is meant to improve execution rather than change the company's underlying content strategy, the analysts say. "The company provided no comparable U.S. engagement metrics or timeline for improvement, leaving the broader competitive debate unresolved," the analysts say. Netflix is off nearly 5%. (katherine.hamilton@wsj.com)
1259 ET - Netflix's advertising business has investors worried, StoneX analyst Daniel Kurnos says. Kurnos says the shortcoming in ad revenue is more related to a rollout delay, but is weighing heavily on Netflix's margins in the near-term. Management said there were delays integrating with some partners, which Kurnos read as a timing issue, rather than demand. Kurnos expects Netflix's recent job cuts will at least offset the shortfall in ad sales. Subscription revenue effectively carried overall ad sales, he says. Shares fall 4.7%. (katherine.hamilton@wsj.com)
1256 ET - Moncler cleared the third-quarter lull ahead of its crucial winter season, Bernstein analysts said in a research note. The Italian luxury-fashion company reported third-quarter revenue that matched sell-side consensus expectations, despite a lack of demand in Europe from Asian tourists, the brokerage says. The group's namesake brand "remains vibrant globally, delivering relative resilience in a tough macroeconomic context" and despite weak tourism flows, the analysts say. "Stone Island, moreover, is now a contributing factor rather than a problem," they add. (andrea.figueras@wsj.com)
1254 ET - New light vehicle sales were up in each of Canada's 10 provinces in September, led by a 10.1% jump on-year in Saskatchewan and 9.6% advance in Prince Edward Island, DesRosiers Automotive Consultants data shows. However, year-to-date sales remain mixed. DesRosiers says there were an estimated 168,000 vehicles sold in September, up 3.4% year-over-year. Year-to-date sales settled at 1.46 million units, 0.7% behind the same time last year. "Regionally, the market continues to operate in a tight band with year-to-date performance of all provinces other than PEI in a narrow range from +2.1% to -2.5%," says managing partner Andrew King.
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