U.S. equities are higher, as the markets look to get back to their winning ways after a two-day losing streak. Equity news remains focused on earnings, as Netflix fell well short of estimates but easily beat the Street's forecasts for subscribers, and PPG Industries bested expectations. Meanwhile, Alphabet announced it will slash its workforce by 12,000 jobs. Economic news is on the light side today, with the lone report showing an eleventh-straight decline in existing home sales. Treasury yields are gaining ground, and the U.S. dollar is ticking to the upside, while crude oil prices are little changed, and gold is rising. Asia finished higher, and Europe is seeing gains across the board, as investors digest economic data in their respective regions.
At 10:58 a.m. ET, the Dow Jones Industrial Average is up 0.1%, the S&P 500 Index is gaining 0.6%, and the Nasdaq Composite is 1.0% higher. WTI crude oil is increasing $0.03 to $80.64 per barrel, and Brent crude oil is advancing $0.07 at $86.23 per barrel. The gold spot price is trading $8.00 higher to $1,932.20 per ounce, and the Dollar Index is trading 0.1% to the upside at 102.12.
Netflix Inc. (NFLX $337) reported adjusted Q4 earnings-per-share (EPS) of $0.12, well short of the $0.45 the FactSet estimate, while revenues were mostly in line with expectations at $7.85 billion, an 18.5% increase year-over-year (y/y). The on-demand video streaming service company cited a $462 million loss related to Euro-denominated debt for the lower-than-expected EPS figure, but posted an operating margin of 7%, which eclipsed analysts' expectations, and added 7.66 million net subscribers during the quarter, trouncing the Street's forecast of 4.57 million additions. NFLX also announced that co-CEO Reed Hastings will step down from his position and transition to Executive Chairman, with the company's current Chief Operating Officer, Greg Peters, promoted to join Ted Sarandos in the role. Looking ahead, NFLX said it sees Q1 2023 EPS of $2.82 versus estimates for $2.98, on revenues of $8.17 billion, a shade above the Street's $8.15 billion forecast. Shares are nicely higher.
PPG Industries Inc. (PPG $131) posted Q4 EPS of $1.22 ex-items, above the expected $1.13, with revenues nearly flat y/y at $4.19 billion, versus the forecasted $4.11 billion. President and CEO Tim Knavish said the company "continued to make good progress on our focus to achieve full operating margin recovery…despite more acute pandemic-related demand disruptions in China," adding that the earnings improvement was driven by aggregate selling price increases, and that it remained focused on alleviating the significant cost inflation incurred the past two years. The paints and coatings maker said it sees Q1 EPS within a range of $1.10-1.20, compared to the FactSet estimate of $1.35, with higher corporate and interest expenses estimated to negatively impact adjusted EPS by roughly $0.20 on a y/y basis. PPG is trading to the upside.
Google parent Alphabet Inc. (GOOGL $97) said it will lay off 12,000 employees, or roughly 6% of its workforce, adding to the list of major tech companies shedding workers amid fears of an oncoming recession. In an email to staff, CEO Sundar Pichai said the cuts in the U.S. will begin immediately, but those in other countries could take longer as a result of local laws and practices. Shares are higher.