Facebook in freefall as weak outlook stuns market

[bobsm]

Facebook in freefall as weak outlook stuns market
26 Jul 2018 05:16AM (Updated: 26 Jul 2018 07:27AM)

SAN FRANCISCO: Facebook shares went into a freefall on Wednesday (Jul 25) as a stunningly weak financial outlook raised fresh concerns for the social networking giant as it tries to recover from the impact of data protection scandals and investigations.

After-hours trade saw Facebook shares plunge by some 21 per cent, wiping out an estimated US$130 billion in market value if the slump is confirmed at Thursday's market opening.

The second-quarter report sparked initial selling after it showed revenue and user growth came up short of expectations.

Profit was up 31 per cent in the second quarter at US$5.1 billion; revenues rose 42 per cent to US$13.2 billion, slightly below most forecasts.

Selling pressure accelerated when chief financial officer David Wehner warned in a call with analysts of a weaker outlook in the coming quarter.

Wehner said revenue growth "decelerated" in the second quarter and will decline "by high single digit percentages" and added that "we are also giving people who use our services more choices around data privacy which may have an impact on our revenue growth."

On the call, Jefferies & Co. analyst Brent Thill said that "many investors are having a hard time reconciling that deceleration ... It just seems like the magnitude is beyond anything we've seen."

Ross Gerber, an analyst at Gerber Kawasaki, said the latest figures suggest that the tide may be turning for Facebook and other social networks.

"Social Media has peaked," Gerber said on Twitter. "We told you last qtr and now we're seeing it."


Read more at https://www.channelnewsasia.com/new...reefall-as-weak-outlook-stuns-market-10563482


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Even more bad news:

China Revokes Approval For New Facebook "Innovation Hub"

https://www.nasdaq.com/article/china-revokes-approval-for-new-facebook-innovation-hub-20180725-01023

 

[GHALIB]

strengthen security can recover them.

 

[大汉奸柳传志]

ok this is bizarre, I thought Whirlpool is among a few companies that are supposed to benefit from a trade war

Whirlpool shares plunge 14.5%, post worst day since 1987 as tariffs wreak havoc with costs and suppliers

• The U.S. based washing machine giant who was once in favor of stricter trade controls for its own industry.
• Whirpool shares plummeted Tuesday after executives blamed rising steel and aluminum costs for diminished quarterly earnings.
• Washing machines are one example of how tariffs can have unexpected and adverse effects on the domestic companies the policies attempt to protect.

Michael Sheetz | @thesheetztweetz
Published 12:27 PM ET Tue, 24 July 2018 Updated 4:22 PM ET Tue, 24 July 2018CNBC.com


Whirlpool sinks 8 percent following earnings report 10:54 AM ET Tue, 24 July 2018 | 01:06
Shares of Whirlpool, the U.S. based washing machine giant who was once in favor of stricter trade controls for its own industry, posted their worst day in over 30 years after executives blamed rising steel and aluminum costs for diminished quarterly earnings.

"Global steel cost has risen substantially and, particularly in the US, they have reached unexplainable levels," Whirlpool CEO Marc Bitzer told shareholders during a conference call Tuesday.

Whirlpool stock fell 14.5 percent Tuesday, its worst day since October 19, 1987.


The U.S. company was a major advocate for legislation to protect against what Bitzer last year called a "long story of dumping" by foreign competitors LG and Samsung in the washing machine business. Bitzer said during the company's fourth-quarter earnings call that the White House had "put an end" to this alleged dumping, saying it was "encouraging that finally trade laws are being enforced."

"As the next couple months unfold, we will see a lot more clarity" for how tougher trade laws will impact the Whirlpool's bottom-line, Bitzer said on Jan. 25.

Now the company cites U.S. tariffs on steel and aluminium as contributing to the increased cost in Whirpool's raw materials. Three months after calling the government's actions on trade an "incredible" outcome, Bitzer said on Whirlpool's first-quarter earnings call April 24 that costs "have risen substantially and, as a result, we're revising our raw material inflation guidance for 2018."

On Monday, Whirpool again raised its guidance for costs of steel and aluminum in its second-quarter report, while the company again adjusted its expected 2018 profits downward.

Bitzer at times on the call Tuesday downplayed the effects of the tariffs, saying the impact was "almost the same order" as impacts from a freight shortage in the second quarter. Instead, Bitzer focused on the price of steel.

"U.S. steel is 50 percent more expensive than the rest of the world and simply cannot be explained by the input cost," Bitzer said.

Washing machines are one example of how tariffs can have unexpected and adverse effects on the domestic companies the policies attempt to protect. Whirlpool also noted the hit taken by its suppliers.

"We are impacted by the tariffs, as we are an import of record of our suppliers who have to basically pay the tariffs," Bitzer said.

Bitzer expects "the U.S. industry to recover" in the second half of the year, but Whirpool still lowered its full year profit forecast. The company now expects 2018 adjusted earnings per share between $14.20 and $14.80, down from its previously guided range of earnings per share between $14.50 and $15.50, citing primarily the rising costs of steel and aluminium.


https://www.cnbc.com/2018/07/24/whirlpool-stock-plunges-as-tariffs-hit-suppliers-steel-costs.html

 

[GHALIB]

trump's policies are taking it's toll .