Investment bank Morgan Stanley (NYSE: MS) cut about 2% of its staff on Tuesday, CNBC reported, citing anonymous sources with knowledge of the layoffs. The moves reportedly impacted about 1,600 of the firm's 81,567 employees and affected nearly every corner of the global investment bank. Financial advisors are one of the few workers exempt from the layoffs. Morgan Stanley is following Goldman Sachs (NYSE: GS) and other financial giants like Barclays (NYSE: BCS) and Citigroup (NYSE: C) in reinstating the annual culling of underperformers. Banks typically trim 1% to 5% of their weakest workers before bonuses are paid, leaving more money for remaining employees. The industry paused the practice in 2020 after the pandemic began, but deal flow cratered this year amid the Federal Reserve's aggressive tightening. A Morgan Stanley spokesman declined to comment on the report.
The United Auto Workers union will attempt to organize a major electric vehicle battery plant for a Detroit automaker for the first time, potentially setting a precedent for similar facilities to come, CNBC reported Tuesday. Labor and industry experts largely expect workers at an Ohio plant of Ultium Cells, a joint venture between General Motors (NYSE: GM) and LG Energy Solution, to vote in support of the UAW's representation. Art Wheaton, a labor professor at Cornell's Worker Institute, said: "If they can show that the workers there trust the union, then other battery plants may have more pressure to follow suit." The organizing vote is set for Wednesday and Thursday, and about 900 workers will be eligible to vote. Joint venture battery facilities are viewed as crucial for the UAW to grow and add new members.
Senate Banking Committee Chairman Sherrod Brown (D-OH) will introduce a bill Tuesday to close the so-called shadow banking loophole that allows retail and tech firms to offer banking services without the same stringent oversight as other financial institutions. Senators Chris Van Hollen (D-MD) and Bob Casey (D-PA) co-sponsored the bill. Brown said: "To protect consumers' pocketbooks and ensure a strong banking system for Main Street, we need to ensure all banking institutions play by the same rules." The Close the Shadow Banking Loophole Act comes about a month after Twitter CEO Elon Musk shared his plan to transform it into a payment service and reportedly registered with the Treasury as a payments processor. The Independent Community Bankers of America, Americans for Financial Reform, and the Bank Policy Institute are among 18 banking industry advocates who support the proposal.
AutoZone (NYSE: AZO) reported first quarter earnings today before the bell, and in the afternoon its stock has fallen 3.1% to $2,449 after the earnings beat. The automotive parts retail firm posted net income of $539.3 million, down 2.9% from $555.2 million in the prior year period. AutoZone posted GAAP earnings per share of $27.45, up from $25.69 and beating consensus estimates of $25.37. The firm posted revenue of $3.99 billion, up 8.7% from $3.67 billion and beating consensus estimates by $130 million. Domestic same store sales rose 5.6%. Cash and equivalents totaled $269.8 million. Chief executive Bill Rhodes said the firm delivered solid same store sales results and its initiatives to grow business position it well for the rest of the year. Looking ahead to the full year, the firm did not give earnings guidance.
Ferguson plc (NYSE: FERG) reported first quarter earnings today before the bell, and in the afternoon its stock has risen 4.9% to $121.14 after the earnings beat. The British-American plumbing and heating goods firm posted net income of $595 million, up from $560 million in the prior year period, or GAAP earnings per share of $2.84, up from $2.40. Ferguson posted adjusted earnings per share of $2.95, up from $2.50 and beating consensus estimates of $2.79. The firm posted revenue of $7.93 billion, up 16.6% and beating consensus estimates by $250 million. Cash and equivalents totaled $638 million. Chief executive Kevin Murphy said the firm continued to deliver a strong performance, showing the core strengths amid macroeconomic headwinds. Looking ahead to the full year, Ferguson sees low single digits revenue growth.
Signet Jewelers (NYSE: SIG) reported third quarter earnings today before the bell, and in the afternoon its stock has soared 18.2% to $68.30 after the earnings beat. The jewelry firm posted net income of $28.8 million, down from $83.9 million in the prior year period, or GAAP earnings per share of 60 cents, down from $1.45. Signet posted adjusted earnings per share of 74 cents, down from $1.43 and beating consensus estimates of 32 cents. The firm posted revenue of $1.6 billion, up 6.7% and beating consensus estimates by $90 million. Cash and equivalents totaled $327.3 million. Chief executive Virginia Drosos said the strong results exceeded guidance. Looking ahead to the full year, Signet lifted its guidance, now seeing adjusted earnings of $11.40 to $12.00 per share on revenue of $7.77 to $7.84 billion.
Integrated Electrical Services (NASDAQ: IESC) reported fourth quarter and full year earnings today before the bell, and in the afternoon its stock has jumped risen 1.7% to $35.15 after the earnings results. The infrastructure services firm posted net income of $16.2 million, down 28% from $22.4 million in the prior year period, or GAAP earnings per share of 72 cents, down from $1.07. IES posted adjusted earnings per share of 95 cents, down from $1.30. The firm posted revenue of $617.4 million, up 27.6%. Wall Street did not provide earnings estimates. For the full year, the firm reported net income of $34.8 million, down 48%. Chief executive Jeff Gendell said the results showed a marked improvement in profitability and the firm remains optimistic despite several operating challenges. Looking ahead, the firm did not give earnings guidance.
Couchbase (NASDAQ: BASE) reported third quarter earnings today before the bell, and in the afternoon its stock has fallen 5.85% to $13.14 after the earnings beat. The database software firm posted a net loss of $16.7 million, down from $15.9 million in the prior year period, or GAAP earnings per share of -37 cents, flat from last year. Couchbase posted adjusted earnings per share of -22 cents, up from -29 cents and beating consensus estimates of -33 cents . The firm posted revenue of $38.56 million, up 25.2% and beating consensus estimates by $1.96 million. Chief executive Matt Cain said the firm delivered results ahead of all guidance metrics despite a more challenging macroeconomic environment. Looking ahead to the full year, Couchbase lifted its guidance, now seeing revenue of $151.4 to $151.6 million, above analysts' expectations.
Waterdrop (NYSE: WDH) reported third quarter earnings today before the bell, and in the afternoon its ADR stock has jumped 8.2% to $1.98 after the earnings results. The Chinese insurance and healthcare firm posted net profit of ¥169.6 million or $23.8 million, up from net loss of ¥477.0 million in the prior year period. Waterdrop posted GAAP earnings per share of ¥0.04 or $0.01, up from ¥0.12. The firm posted revenue of $108.6 million, down 0.9%. Wall Street did not provide earnings estimates. The firm offered 536 insurance products, up from 454. Cash, equivalents, and short-term investments rose to $504.5 million. Chief executive Peng Shen said the firm delivered another quarter of solid financial performance despite the COVID-19 resurgence and soft macroeconomic environment. Looking ahead, the firm did not give earnings guidance.
GitLab (NASDAQ: GTLB) reported third quarter earnings yesterday after the bell, and today in the afternoon its stock has jumped 6.55% to $40.85 after the earnings beat. The software firm posted a net loss of $48.5 million, down from $41.2 million in the prior year period, or GAAP earnings per share of -33 cents, up from -62 cents. GitLab posted adjusted earnings per share of -10 cents, up from -34 cents and beating consensus estimates of -15 cents. The firm posted revenue of $112.98 million, up 69.1% and beating consensus estimates by $6.9 million. Customers with over $100,000 of ARR soared 49% to 638. Cash and equivalents totaled $372.2 million. Chief executive Sid Sijbrandij said the firm's value proposition is resonating. Looking ahead to the full year, GitLab sees adjusted net loss of 55 to 56 cents per share on revenue of $420.5 to $421.5 million.
Pfizer (NYSE: PFE) rejected allegations made by rival Moderna (NASDAQ: MRNA) that its COVID-19 vaccine is a copy, accusing the Boston biotech firm of rewriting history to lay claim to technology developed by scientists over many years: "Moderna is wrong, and its revisionist history is not based on fact. Pfizer and BioNTech did not copy Moderna's technology." Pfizer on Monday asked a federal court in Massachusetts to dismiss Moderna's lawsuit seeking monetary damages for alleged patent violations related to the COVID vaccine. Pfizer asked the court to stop Moderna from suing it or its partners again over three alleged patent infringements. Moderna in a complaint filed in August accused Pfizer of copying two key pieces of technology that make the messenger RNA COVID vaccines possible, asking the court to award it monetary damages since March 2022 including royalties and lost profits with interest.
EU antitrust regulators have reached a final deal with Amazon (NASDAQ: AMZN), three years after officials in Brussels opened a probe into whether the tech giant uses data to engage in anti-competitive practices, according to a new Financial Times report Tuesday. Amazon has reportedly agreed to give rival products more visibility in its "buy box," which spurs the majority of the website's purchases. Also, consumers will reportedly see an additional featured offer in cases where the speed of their delivery is not as important. Sellers who use Amazon's Prime membership will not be locked into Amazon's logistics services and be able to negotiate terms with different services directly. The deal between Amazon and the EU is expected to be unveiled on December 20, though the date could be changed. The European Commission told CNBC the investigations are ongoing.
Senators Elizabeth Warren (D-MA), John Kennedy (R-LA), and Roger Marshall (R-KS) in a letter Monday night asked crypto-friendly bank Silvergate Capital (NYSE: SI) for answers over its supposed role in facilitating transfers between bankrupt exchange FTX and its sister firm Alameda Research. The lawmakers wrote: "We are concerned about Silvergate's role in these activities because of reports suggesting that Silvergate facilitated the transfer of FTX customer funds to Alameda." Following FTX's bankruptcy filing, allegations have surfaced that former CEO Sam Bankman-Fried made large transfers of customer funds from the exchange to trading firm Alameda Research, which he also owned. The investment community is suspicious about what role Silvergate may have played in that potentially criminal activity. The bank has until December 19 to officially respond to the Senators. At midday Silvergate shares fell 6.45%.
The RMT general secretary Mick Lynch defended rail strikes across the UK over Christmas and said unions have a "duty to coordinate what they do", arguing the government is sending a message that pay rises will only come with worse terms for workers. He noted the government is "coordinating … an attack on working people" by changing working conditions and offering pay rises below inflation. He told BBC on Tuesday: "It would be foolish of unions not to coordinate themselves in response to those attacks." Lynch said the strikes over Christmas will "not largely affect passenger services" but would have an impact on engineering works between December 24 and 27. The statement came after the union on Monday night unveiled the additional strike dates and rebuffed a pay offer from Network Rail shortly before the industry's deadline.
Telegram's Premium service has amassed over 1 million subscribers, less than 6 months after the Dubai-based popular instant messaging app launched the paid offering and began a serious effort to monetize the business. Founder and CEO Pavel Durov shared the update on his channel Tuesday, calling the milestone "one of the most successful examples of a social media subscription plan ever launched." But he noted the subscription still "represents just a fraction of Telegram's overall revenue," optimistically hoping that someday Premium will rake in just as much money as ads. The app, with over 700 million monthly active users, launched Premium in June, offering customers a range of additional features such as the ability to send files as large as 4 GB and faster downloads. The monthly subscription costs about $6 in the US and the UK or $2.2 in emerging markets like India.