The daily business briefing: May 12, 2022
Inflation slowed but remained high in April, Disney+ adds more subscribers than expected, and more
Consumer prices rose 8.3 percent in April
The consumer price index rose 8.3 percent in April compared to a year earlier, down from the 8.5 percent pace recorded in March, the Bureau of Labor Statistics reported Wednesday. Prices were up 0.3 percent compared to the month before, down from a 1.2 percent increase in March. Despite the slowdown, inflation remained near 40-year highs. Core inflation, which excludes volatile food and energy prices, rose 0.6 percent in April, compared to 0.3 percent in March. The April numbers were slightly higher than expected, fueling investors' inflation fears. The three main U.S. stock indexes dropped on Wednesday. The tech-heavy Nasdaq was hit hardest, falling 3.2 percent. Dow Jones Industrial Average, S&P 500, and Nasdaq futures fell early Thursday.
Disney+ adds more streaming subscribers than expected
Disney said Wednesday it added 7.9 million Disney+ subscribers last quarter, beating Wall Street expectations of roughly 5 million new subscribers, according to The Hollywood Reporter. Disney CEO Bob Chapek said the numbers "once again proved that we are in a league of our own." The performance was especially notable as it came just weeks after video-streaming powerhouse Netflix reported it lost 200,000 subscribers in the quarter, its first subscriber loss in a decade. It was a big miss for Netflix, which projected it would gain 2.5 million subscribers, raising concerns that streaming companies that thrived early in the pandemic were in for hard times now that lockdowns and other coronavirus restrictions have been lifted.
Rivian reports loss but maintains production target
Electric vehicle maker Rivian Automotive said Wednesday it is on track to meet its 2022 production target of building 25,000 vehicles. The company reported a quarterly loss of $1.43 per share, just under the $1.44 per share consensus estimate from Refinitiv. Rivian said it has received more than 90,000 reservations for its R1-series electric truck and SUV, up from 83,000 when it last updated in March. About 10,000 of the reservations have come since Rivian hiked prices in early March, bringing its average purchase price to more than $93,000 per vehicle. The company said planned production was down by about a quarter since the end of March due to shortages of semiconductor chips and other key components.
Moderna fires new CFO after 1 day
Moderna, maker of a key coronavirus vaccine, fired its new chief financial officer, Jorge Gomez, after one day on the job this week, after his former company launched an investigation into its books. Gomez's former company, Dentsply Sirona, told the Securities and Exchange Commission in a filing that its internal inquiry involved "allegations regarding certain financial reporting matters submitted by current and former employees." Gomez will get $700,000 to cover 12 months of salary, but he will have to forfeit his $500,000 signing bonus, moving expenses, and other benefits, Moderna said in a filing.
Beyond Meat shares fall below IPO price for 1st time
Beyond Meat shares plunged 26 percent in after-hours trading on Wednesday after the plant-based meat producer reported a quarterly net loss of $100.5 million, compared to a $27.3 million loss in the same quarter a year earlier. The loss for the quarter came to $1.58 per share, far above the 97 cents a share expected by analysts polled by FactSet. Investments in products such as Beyond Meat Jerky cut into profits. The overnight stock drop came after the company's shares fell 14 percent in regular trading on Wednesday. Beyond Meat shares are now priced below the company's initial public offering price for the first time since its stock debuted three years ago.