Here are five things you need to know this morning:
Meta and Microsoft underwhelm: Shares of two tech giants are under pressure this morning after posting disappointing financial results after the bell yesterday. Microsoft said its revenue rose by 16 per cent to just over US$65 billion and profit hit $3.30 per share, both beating estimates. But the shares are down on a muted outlook for the company’s cloud computing business. Azure revenue grew by 34 per cent in the last quarter, but for the current period the cloud-computing business is on track to expand by less than that. It was a similar story at Meta, where sales came it at $40.6 billion for the quarter. That was slightly ahead of the $40.3 billion expected, but investor focus is on the future, where the company is warning they will continue to spend big on AI and the metaverse. Shares were down about four per cent in premarket trading this morning.
Starbucks future it its past: The new CEO of Starbucks has a plan to turn around the coffee chain, and big parts of it involve going back to things they did in the past. The chain is bringing back ceramic mugs in a bid to bring back the coffeehouse vibe of the chain, and have it feel less like fast food – although the company is promising that customers will have their orders within four minutes of coming into the store. Condiment bars with creamer, milks, and sweeteners will also soon return, after mostly vanishing during the pandemic. And sharpies that baristas can use to personalize cups will return too, so look forward to interesting interpretations of your name again. Whether it’s enough to turn around the chain’s three-quarter run of slumping sales remains to be seen.
GDP unchanged in August: Canada’s economy was flat in August, Statistics Canada reported this morning. That was in line with expectations but still a sign of a slowing economy. The goods producing sector shrank by 0.4 per cent from July’s level, but that was offset by a 0.1 per cent expansion in the larger service sector. The flash estimate for September is tracking towards 0.3 per cent growth, the data agency said.
Estee Lauder shares tumble: Shares in Estee Lauder are getting hammered this morning after the beauty company pulled its guidance for the year and cut its dividend citing weak demand in China. If the 23 per cent decline in the shares holds through the day, it will be the company’s worst day on record. And it comes after the company has already lost 40 per cent of its value this year. It has been dealing with slumping sales in the U.S. for a while but now says demand from China is weak as well, so the bottom has fallen out. The company named a new CEO this week who will take over in the new year, but the firm’s decision to cut its guidance entirely suggests their problems are worse than the market was anticipating.
Bitcoin white paper turns 16 years old: On this day in 2008, a then-unheard-of author called Satoshi Nakamoto published a white paper outlined their idea for a decentralized cryptocurrency system called bitcoin. While technically the first bitcoins were not mined until the following year, the concept is now old enough to be a licensed driver. We still don’t know the identity of the pseudonymous creator (although there’s an extremely dubious sounding press release in my inbox claiming Satoshi is going to reveal himself at an event in London this morning), but whoever they are, with an estimated 1 million bitcoins in their possession and a current market price of US$72,000, they’re among the richest people on earth. Presuming of course that they can remember how to unlock their at least 15-year-old digital wallet.