Alphabet, Netflix, Tesla: Stocks That Defined the Week
By Derek Hall
The Justice Department filed its long-anticipated antitrust
lawsuit against Google Tuesday, targeting the tech giant's flagship
search engine and related advertising business. A partnership with
Apple is at the heart of the case, potentially threatening a
lucrative revenue stream for both companies. Microsoft, the target
of the last major tech antitrust campaign in 1998, now stands to
benefit the most from the DOJ's newest lawsuit. Alphabet shares
rose 1.4% Tuesday.
Goldman Sachs Group Inc.
Goldman Sachs is paying billions to wipe the stain from its
dealings with the Malaysian investment fund known as 1MDB. A
Goldman subsidiary on Thursday pleaded guilty to conspiring to
violate U.S. antibribery laws, and the bank agreed to pay nearly $3
billion to officials in four countries. Goldman's deal with
authorities brings an end to a long-running investigation of its
role in the global bribery ring and allows the bank itself to avoid
prosecution. All in, its 1MDB penalties to date amount to more than
$5 billion, including an additional $2.5 billion to the government
of Malaysia and a $350 million fine from Hong Kong regulators.
Goldman shares rose 1.2% Thursday.
The king of streaming is fending off fresh rivals to the throne.
Netflix on Tuesday said subscriber growth slowed in the third
quarter, an underwhelming result after its breakneck pace of growth
in the first half of the year as people around the globe turned to
streaming services for entertainment during the pandemic-imposed
quarantine. The company reported 2.2 million new subscribers in the
quarter, falling short of its forecast in July of 2.5 million and
highlighting the sharp decline from the 26 million net subscribers
it added in the first two quarters of 2020. With Walt Disney Co.
focusing on streaming initiatives and AT&T Inc. reporting solid
growth in its Netflix-like streaming service HBO Max, Netflix is
looking for ways to stay on top in an increasingly crowded
streaming market. Netflix shares fell 6.9% Wednesday.
Tesla has recharged its batteries after the pandemic disrupted
operations earlier in the year. The electric-car maker extended its
profitability streak in the third quarter, marking the company's
fifth consecutive quarter in the black. Tesla on Wednesday reported
a net profit of $331 million for the three-month period ended Sept.
30 and posted a record $8.77 billion in revenue. Chief Executive
Elon Musk called it Tesla's "best quarter in history," and the
company revived its pre-pandemic target to build at least 500,000
vehicles this year. The Silicon Valley car maker was buoyed in part
by lower battery and purchasing costs at its production facility in
China, as well as growing demand in that country for electric cars.
Tesla shares rose 0.7% Thursday.
Procter & Gamble Co.
Makers of cleaning products are mopping up on the
pandemic-driven demand for better hygiene. P&G on Tuesday
reported its biggest global sales increase in 15 years, logging the
strongest growth in the unit that sells Swiffer mops and Dawn dish
soaps. The maker of Tide detergent and Gillette razors said sales
gains early in the pandemic were boosted by consumers stocking up
for lockdowns and to avoid shortages. But demand in recent months
appears driven by a sustained focus on home cleaning and personal
hygiene, the company said. Earlier Tuesday, Lysol maker Reckitt
Benckiser Group PLC reported its sharpest quarterly sales growth on
record, driven by its hygiene unit, something Reckitt Chief
Executive Laxman Narasimhan thinks will outlast the pandemic.
P&G shares rose 0.4% Tuesday.
The world's largest retailer is suing Uncle Sam. Walmart said
its lawsuit against the federal government is an attempt to strike
a pre-emptive blow against an impending opioid-related civil
lawsuit from the Justice Department, an aggressive and unusual
tactic. In its complaint, Walmart said the DOJ and Drug Enforcement
Administration want to scapegoat the company for the federal
government's own regulatory and enforcement shortcomings. Walmart's
move came after Purdue Pharma LP pleaded guilty to three felonies
related to its marketing and distribution of OxyContin, as part of
an $8.34 billion settlement agreement with the Justice Department.
Walmart shares rose 0.2% Friday.
Southwest Airlines Co.
U.S. airlines remain in a holding pattern. Summer was a bust and
losses are mounting as airlines anxiously watch a fragile uptick in
demand to see if it will hold as coronavirus cases continue to
climb. The pandemic eviscerated travel demand during what is
typically the most lucrative season, and revenue plunged, with the
four largest U.S. carriers reporting losses of more than $25
billion this year so far. On Thursday, Southwest said it lost
nearly $1.2 billion during the third quarter -- its biggest
quarterly loss ever, and American Airlines Group Inc. reported a
loss of $2.4 billion. Alaska Air Group Inc. on Thursday reported
losing $431 million. Southwest shares rose 5.2% Thursday.
(END) Dow Jones Newswires
October 23, 2020 21:09 ET (01:09 GMT)
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