By Louis Juricic and Sarina Isaacs
Investing.com — Here is your weekly Pro Recap on the biggest headlines out of a big earnings week for tech: Tesla’s miss and price cut; Netflix’s price bump; Apple’s new China App Store policy; Rivian’s debt offering.
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h2 Tesla’s delivery miss, newest price cuts/h2
Tesla (NASDAQ:TSLA) on Monday missed EV delivery estimates after summer upgrades to its factories, reporting 435,059 vehicles in Q3 vs. Wall Street expectations for 456,722.
On the production side, the EV giant manufactured a total of 430,488 vehicles during the quarter, below the estimate of 461,992. Tesla said it expected a drop from Q2 as it made upgrades to facilities, adding, “Our 2023 volume target of around 1.8 million vehicles remains unchanged.”
Wedbush Securities, which has an Outperform rating on Tesla shares, blamed the miss on longer-than-expected downtimes of factories in Shanghai and Austin, Texas, that it says forced the shift of some 20,000 units into the fourth quarter, based on its estimates.
“We believe Tesla is now set to be entering the next stage of growth for the company globally with the Model 3 refresh front and center in China and Cybertruck production set to kick off beginning around Halloween,” Wedbush said in a note on Monday, calling them tailwinds for the stock going into the next year.
Later in the week, the company also announced it would once again reduce prices on some of its popular EVs in the US, cutting its price on the Model 3 sedan to $38,990 from $40,240, and on its long-range Model 3 to $45,990 from the prior $47,240.
The performance model’s price tag has been reduced to $50,990 from $53,240, and the Model Y performance sport utility vehicle saw a price reduction to $52,490 from $54,490.
Tesla shares initially took a hit on both of these pieces of news, but ultimately gained ground for the full week, rising 6.4% to $260.53 from Monday’s open. Shares are also up some 140% year to date.
h2 Netflix eyes price bump after actors strike: report/h2
According to The Wall Street Journal, Netflix (NASDAQ:NFLX) plans to again hike the price of its ad-free service in several markets globally just a few months after the Hollywood actors’ strike ends.
Citing sources familiar with the matter, the WSJ said it believes Netflix will likely begin the price bumps in the US and Canada, although they are unsure how much the price will be lifted by or when they will take effect.
The move would come amid a number of price hikes among streaming companies as they aim to improve profitability without alienating customers, with the WSJ calculating a 25% rise in major ad-free streaming services over the past year.
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Netflix was up 1.2% for the week to $381.51 from Monday’s open.
h2 Rivian sinks on debt offering and preliminary numbers/h2
Shares of Rivian Automotive (NASDAQ:RIVN) plunged some 23% Thursday after the EV maker announced a $1.5 billion green convertible senior unsecured note offering the previous night, along with disappointing preliminary Q3 results.
The debt offering, expected to extend the company’s cash runway through 2025, includes an option for an additional $225 million. The notes can be redeemed for cash between October 2027 and September 2030, subject to specific share price performance conditions.
The company also said it currently expects Q3 sales to come in between $1.29B and $1.33B, slightly below market expectations.
Still, Truist remains bullish with a Buy rating and $30 price target on the stock, writing that the announcement “largely falls in line with expectations & represents RIVN’s strategy of continued opportunistic capital raises.”
They did add that they would not be surprised by a pullback, but added, “with most of the unknowns out of the way, we see an increasingly positive setup into the 3Q print.”
Overall, the shares lost 20.7% for the week to $18.92 from Monday’s opening price.
h2 Apple changing App Store rules as China tightens grip/h2
Starting recently, Apple (NASDAQ:AAPL) is now mandating that new apps must provide proof of a Chinese government license before they can be published on its platform.
The move aligns Apple with local competitors that had already adopted this policy years ago to comply with China’s increasingly strict regulatory environment.
Obtaining the newly required “internet content provider (ICP) filing” license typically involves having a presence in China or collaborating with a local publisher, posing challenges for numerous foreign app developers.
Apple had previously maintained a more lenient approach to ICP filings, which allowed it to offer a more extensive selection of mobile apps compared to local rivals and contributed to Apple’s popularity in China, its third-largest market.
Shares are up 3.7% to $177.49 for the week vs. its Monday open.
Senad Karaahmetovic and Sam Boughedda, contributed to this report.