Here is your weekly Pro Recap of the week’s most important tech news that you may have missed on InvestingPro, including earnings from Tesla and IBM, negative projections from Netflix and TSMC, and potential bad news for Alphabet.
Tesla’s major miss
Tesla (NASDAQ: TSLA) fell last week following CEO Elon Musk’s pledge to continue reducing prices on the company’s electric vehicles, despite the fact that these price cuts led to a significant first-quarter earnings miss.
Musk stated that the price decreases are intended to increase demand, despite their negative impact on margins. Over a dozen Wall Street analysts lowered their price targets for Tesla, and at least two analysts (Truist and Tudor Pickering) downgraded the stock.
The stock closed the week at $65.08, down 11.4%, and other manufacturers fell in sympathy.
Netflix stumbles on a delay
Netflix (NASDAQ: NFL) also declined due to a disappointing forecast as a result of a delay in addressing the prevalent practice of password sharing among Netflix accounts.
Despite the possibility that some users will terminate their subscriptions in response to the solution’s launch, analysts believe that it will ultimately result in long-term gains.
The news resulted in a 3% decline in share prices for the week.
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Google may lose its status as the default search engine
Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOGL) also lost ground on Monday following a New York Times report that Samsung (KS:005930) may use Microsoft’s (NASDAQ: MSFT) AI-powered Bing as its default search engine. Currently, Samsung devices utilize Google as their default search engine.
The stock fell as much as 4% on Monday, but recovered to conclude the week fractionally higher.
A’sigh of relief’ for IBM
Positively, IBM (NYSE: IBM) reported fourth-quarter earnings that exceeded analyst expectations, driven by an increase in margins due to demand in its software division and cost reductions.
“Investors breathed a sigh of relief when IBM’s quarterly update exceeded expectations,” said Jesse Cohen
BMO analysts reduced their price target for IBM shares from $155 to $145 per share, while Morgan Stanley (NYSE: MS) analysts also lowered their price targets and remain cautious on the stock’s opulent valuation.
The stock market surged in response to the news, but closed the week 2% lower at $25.73.
Apple supplier predicts a decline in demand
Chipmaker Taiwan Semiconductor Manufacturing (BVMF: TSMC34) (NYSE: TSM) announced in January that it would reduce its capital expenditures in 2023 to between $32 billion and $36 billion, down from $36.3 billion in 2022.
The company, which also supplies processors to Nvidia (NASDAQ: NVDA) and Advanced Micro Devices (NASDAQ: AMD), manufactures the world’s most advanced semiconductor chips and is the most valuable company in Asia.
TSMC ADRs decreased 2.7% for the week.