Weekly Stockwatch: Disney+ Subscriber Growth, Nvidia-Arm Acquisition Cancellation, French Banks Earnings & More

Disney+ Growth

The Walt Disney Company announced solid results for Q1 FY2022 [1], with "Disney Parks, Experiences and Products" posting operating income of $2.45 billion – the segment's third straight profitable quarter.

Overall Revenues grew 34% year-over-year to $21.819 billion and diluted Earnings/share rose to $1.06, from 0.32 a year ago.

Most importantly, Disney+ added 11.8 million paid users, bringing the total to 129.8 million as of January 1 2022. The Disney+ streaming service has seen meteoric rise since it launched in late-2019, but during the quarter growth had slowed down.

Also this week, the 2022 Oscars nominations were announced, with Disney getting 23 nods, behind Netflix's 27 nominations.

DIS.us gained more than 3% on Thursday after the results, closing above $150 and heading towards a profitable week.

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Nvidia-Arm Deal Cancelation

The biggest news this week was probably Tuesday's cancellation of Nvidia's acquisition of Arm, due to "significant regulatory challenges preventing the consummation of the Transaction". [2]

Nvidia had agreed to buy the British chip designer from SoftBank for $40 billion in September, but the agreement quickly came under scrutiny form regulators around the world.

Despite this development, NVDA.us gained in the following days and is up on the week, although it declined on Thursday, as the tech sector reeled from the US inflation surge that day.

Uber vs Lyft

Both US-based ride-hailing companies released their fourth quarter results this week. On Tuesday, Lyft reported Revenue of $969.9 million, marking an impressive 70% rise from Q4 2020 and 12% over Q3 2021. Its Net Loss Net Loss narrowed to $258.6 million compared the loss of $458.2 million in the same period a year ago, but was larger the $71.5 million lost in Q3 2021.

These were solid figures, but the firm did not perform that well on Active Riders front, which dropped to 18.728 million in Q4 2021, from 18.942 million in the prior quarter, remaining in pre-pandemic level.

During the earnings call, the company said expect revenue in Q1 2022 to between $800 million and $850 million, disappointing markets. [3]

Uber's Revenue jumped more than 80% year-over-year in Q4 2021, to $5.778 billion and generated profit $892 million, from a $2.424 billion Net Loss in the previous quarter. Gross Bookings grew 51% year-over-year, to $25.866 billion.

The firm's Delivery business which had supported it during the pandemic, remained the highest Revenue contributor above core Mobility segment, while the Freight business accounted for $1 billion. [4]

French Banks Earnings

The French banking sector was in the spotlight this week, as three heavyweights announced their latest financial results.

On Thursday, Societe Generale Net Banking Income of €25.798 billion for full 2021 and €6.620 billion in Q4, up 16.7% and 13.4% respectively (year-over-year). It also announced a buyback program of around €915 million and proposed dividend of €1.65 per share.

CEO Fréderic Oudéa, commented that "2021 marks a milestone for the Societe Generale Group, which achieved the best financial results in its history, enabling it to generate a good level of profitability and offer its shareholders an attractive return." [5]

On the same day, Crédit Agricole Group reported (stated) Revenues of €36,822 for full 2021 and €9.5 billion for the fourth quarter of the year – both up over 9% year-over-year. The Group recorded +1,701,000 new Retail banking customers in 2021. It also said that it will present its new 2025 development plan on 22 June. [7]

Delivery Hero Results

German-based Delivery Hero announced a 66% y/y Revenue surge for the fourth quarter of 2021, to €1.9 billion, with gross merchandise value (GMV) of €9.6 billion. Orders increased 27.1 year-over-year, to 775.5 million.

The delivery platform provided solid forward guidance for full 2022, with Revenue of €9.5 - €10.5 billion and GMV of €44 - 45 billion, but the stock dropped after the report on Thursday.

The firm's CEO commented on December's agreement to become majority holder of Spanish delivery app Glovo, saying that it "will increase our geographical footprint and long term growth potential. Upon closing, we will serve up to 2.2 billion people around the world." [8]

DHER.de shed more than 20 euros after the financial results on Thursday and today it extends it slump, trying to defend 40.00.

Next Week (February 14-18)

Over the upcoming week, we expect another series of high-profile earnings, most notably Nvidia on Wednesday February 16. From Europe, plane maker Airbus stands out on Thursday, while on the Australian there is increased activity form Australia, with firms such as telecommunications giant Telstra.

Nikos Tzabouras

Senior Market Specialist

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.

References

1

Retrieved 11 Feb 2022 https://thewaltdisneycompany.com/app/uploads/2022/02/q1-fy22-earnings.pdf

2

Retrieved 11 Feb 2022 https://group.softbank/system/files/news/press/2022/20220208/20220208_0_en.pdf

3

Retrieved 11 Feb 2022 https://investor.lyft.com/financials-and-reports/quarterly-results/default.aspx

4

Retrieved 11 Feb 2022 https://investor.uber.com/news-events/news/press-release-details/2022/Uber-Announces-Results-for-Fourth-Quarter-and-Full-Year-2021/

5

Retrieved 11 Feb 2022 https://www.societegenerale.com/sites/default/files/documents/2022-02/Q4-21-Financial-Results-Press-Release.pdf

7

Retrieved 11 Feb 2022 https://invest.bnpparibas/en/document/4q21-pr

8

Retrieved 01 Jul 2022 https://ir.deliveryhero.com/websites/delivery/English/6150/news-detail.html

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