Weekly Stockwatch: Rivian Disappointment, Google Acquisition, Adidas Results, Upcoming Earnings & More

  • ADS.de
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  • BMW.de
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  • KO.us
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Rivian Disappointment

The hot EV maker disappointed investors with its earnings report on Thursday after market close. It generated Revenue of $54 million in the fourth quarter of the last year, and had a Net Loss of $2.461 billion, but ended the quarter with $18.423 billion in cash, cash equivalents, and restricted cash, having raised $13.7 billion of gross proceeds with its initial public offering. [1]

Rivian said that it had around 83,000 preorders in the US and Canada for its R1T truck and R1S SUV, as of March 8 and has already produced 1,410 vehicles as of that date this year, exceeding 2021 output.

However, it only expects to produce 25,000 vehicles this year between its three models, from up to 50,000 that it could have made, if it was not constrained by supply chain issues.

The company announced that it is working on a heat pump - which is found in Teslas - and improves battery efficiency in cold weather, while also developing a range of new battery packs.

Rivian has created some buzz in the automotive community, with its R1T model, named 2022 Truck of the Year by MotorTrend. [2]

RIVN.us opened with losses and new record lows on Friday – the first trading day after the earnings.

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Google Acquisition

The tech juggernaut announced an agreement to buy Mandiant, Inc for approximately $5.4 billion, or $23.00 per share. Mandiant is a cybersecurity firm and once the acquisition is completed, it will join Google Cloud. [3]

The CEO of Google Cloud, Thomas Kurian said the deal will help to "further enhance our security operations suite and advisory services, and help customers address their most important security challenges".

The firm faced fresh regulatory scrutiny this week, as EU and UK regulators opened today antitrust investigations into Google and Meta over their 2018 advertisement agreement, known as "Jedi Blue". [4]

Adidas Earnings

The German sportswear brand announced on Wednesday its financial results for Q4 and Full Year. It generated Revenue of € 21.234 billion in 2021, 15.2% higher form the prior year. The EMEA counties accounted for most of it (€ 7.760 billion), while Latin America saw the largest growth compared to 2020 (47.2%). [5]

Adidas also said that it experienced double-digit growth in Direct to Consumer (DTC), reflecting improvements in both online and offline shopping, with e-commerce Revenue rising 4%.

Sales in the fourth quarter however, where impacted by supply and demand challenges, staying pretty much steady at € 5.137 billion.

For 2022 the German firm excepts to maintain double digit growth, projecting currency-neutral sales to increase at a rate between 11% and 13%.

CEO Kasper Rorsted, said that "2021 was a successful first year within our new strategic cycle. In 2022, we will build on this momentum and continue to grow both our top- and bottom-line at double-digit rates amid heightened uncertainty".

Last week, the company completed the divestiture of Reebok, having received the majority of the total consideration of up to € 2.1 billion in cash. It also announced a share buyback program of up to € 1.5 billion, to begin this month and until the end of the third quarter. [6]

ADS.de had set two years lows on Monday (169.70), but during the current one it rebounds, having surged after the release of the financial results.

JD.com Earnings

The Chinese retail giant reported Q4 Revenues of RMB 275.9 billion on Thursday, marking a 23% year-over-year rise, but also a small slowdown from Q3's 25.5% year-over-year growth [7]. Its Annual active customer accounts increased by 20.7% to 569.7 million in 2021 from 471.9 million in 2020.

President Lei Xu, commented that the company "maintained a healthy growth momentum and contributed to the high-quality expansion of China's consumption amid a dynamic external environment".

Earlier in the year, JD had opened its tow first physical retail stores in Europe, in Netherlands in particular. They hey are robotic pick-up shops and the firm expected to open more soon. [8]

JD.us plunged more than 15% to its lowest level since mid-2020, on Thursday after the earnings report, heading towards another bad week.

US Exodus from Russia

Western countries have imposed severe sanctions against Russia for its invasion in Ukraine and we have seen many high profile US companies cutting ties with the countries. The latest ones include heavy names with significant exposure in Russia, such as Mcdonalds, Starbucks and Coca-cola.

McDonald's announced on Tuesday the temporary closure of its restaurants and pause of it operations in Russia. It has a more than 30 years of presence in the country and 62,000 employees. [9]

Starbucks said that it has decided to suspend all business activity in Russia, including shipment of all Starbucks products [10], while The Coca-Cola Company announced that it is suspending its business in Russia [11].

Next Week (March 14-18)

The earnings activity has slowed down significantly, but there are still some high profile European firms releasing their results.

German luxury automotive firm BMW releases its full year results on Wednesday. The company already announced this week that vehicle deliveries were up 8.4% compared to the previous year and that Group Revenues rose 12.4% year-over-year to € 111.239 billion. [12]

UK delivery platform Deliveroo - one of the most anticipated IPO's of 2021 - will report its earnings a day later, on Thursday. In January it had provided its quarterly trading update, which had shown a 42% year-over-year rise in orders in Q4. [13]

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 Mar 2022 https://assets.rivian.com/2md5qhoeajym/7MVaHLcGevcUKE0QZZjzEZ/e3ac410e5f9676c894389c6bc844f1e7/Rivian-Q4-2021-Shareholder-Letter.pdf

2

Retrieved 11 Mar 2022 https://www.motortrend.com/news/rivian-r1t-2022-truck-of-the-year/

3

Retrieved 11 Mar 2022 https://abc.xyz/investor/news/releases/2022/0308/

4

Retrieved 11 Mar 2022 https://ec.europa.eu/commission/presscorner/detail/en/ip_22_1703

5

Retrieved 11 Mar 2022 https://www.adidas-group.com/media/filer_public/ac/47/ac47f936-e811-4368-882c-c8d4d53be022/20220309_adidas_ag_fy2021_results_en.pdf

6

Retrieved 11 Mar 2022 https://www.adidas-group.com/en/media/news-archive/press-releases/2022/adidas-completes-divestiture-reebok-and-launches-new-share-buyba/

7

Retrieved 11 Mar 2022 https://ir.jd.com/news-releases/news-release-details/jdcom-announces-fourth-quarter-and-full-year-2021-results

8

Retrieved 11 Mar 2022 https://jdcorporateblog.com/jd-com-launches-robotic-shops-ochama-in-the-netherlands/

9

Retrieved 11 Mar 2022 https://corporate.mcdonalds.com/corpmcd/en-us/our-stories/article/CompanyValues.Russia-update.html

10

Retrieved 11 Mar 2022 https://stories.starbucks.com/press/2022/update-to-starbucks-partners-on-our-business-in-russia/

11

Retrieved 11 Mar 2022 https://www.coca-colacompany.com/press-releases/coca-cola-company-suspends-business-russia

12

Retrieved 11 Mar 2022 https://www.press.bmwgroup.com/global/article/detail/T0372853EN/bmw-group-significantly-increases-group-earnings-and-net-profit

13

Retrieved 08 Dec 2022 https://dpd-12774-s3.s3.eu-west-2.amazonaws.com/assets/6716/4262/9449/Deliveroo_2021_Q4_Trading_Update_RNS.pdf

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