Day: October 23, 2024

(Reuters) -Newmont, the world’s top gold producer, missed Wall Street expectations for third-quarter profit on Wednesday, as higher costs and lower production in Nevada took the shine away from a rise in total output.

Shares of the company fell 6.8% after the bell.

Newmont said that its costs rose due to planned maintenance at the Lihir project in Papua New Guinea — which it acquired following a $17 billion buyout of Newcrest — and higher expenditure for contract services across its portfolio.

All-in-sustaining-costs for gold, an industry metric reflecting total expenses, rose to $1,611 per ounce in the July-September quarter, from $1,426 per ounce a year ago.

The Denver, Colorado-based company’s attributable production at the Nevada Gold Mines declined by 19.3% to 242,000 ounces during the third quarter, compared to the year-ago quarter.

Newmont owns a non-operating minority stake in Nevada Gold Mines, along with rival Barrick Gold, whose third-quarter production fell short of Wall Street expectations earlier this month due to lower output at the Nevada mines.

However, the company’s total gold production rose 29.2% to 1.67 million ounces, primarily due to higher production at the Cerro Negro mine in Argentina, where production had suffered earlier due to the death of two workers.

The market had estimated the miner to produce about 1.64 million ounces of gold during the reported period.

Newmont also said it expects to produce 1.8 million gold ounces in the fourth quarter, its highest output of the year, and remained on track to reach its target of receiving $2 billion from divestment proceedings.

The company posted adjusted profit of 81 cents per share, compared to analysts’ expectations of 86 cents per share, according to data compiled by LSEG.

(Reporting by Vallari Srivastava and Sourasis Bose in Bengaluru; editing by Alan Barona)

By Akash Sriram, Abhirup Roy

(Reuters) -Tesla CEO Elon Musk said he expects vehicle sales to grow 20% to 30% next year, reassuring investors the company was improving its core business of selling electric vehicles profitably, and reducing concerns about when it could produce a robotaxi.

The forecast, building on a target for “slight growth” in deliveries this year, pushed the company’s shares up 12% in post-market trading on Wednesday. This set up Tesla to add about $80 billion in stock market value.

A drop in the cost of making vehicles added comfort for investors who saw Musk focusing on boosting Tesla’s industry-leading margin, even as he talked about a future dominated by autonomous cars.

Tesla’s long-awaited unveiling of its robotaxi on Oct. 10 failed to impress investors.

“No EV company is even profitable,” Musk told analysts on a conference call on Wednesday. “And to the best of my knowledge, there was no EV division of any company, of any existing auto company that is profitable. So it is notable that Tesla is profitable despite a very challenging automotive environment.”

Shares of Tesla’s smaller EV rivals Rivian and Lucid both rose 2% after-hours.

Musk said Tesla would roll out driverless vehicles offering paid rides next year, after the company received regulatory approval in California and Texas.

He said adoption – and sales – of the company’s supervised autopilot software, known as Full Self-Driving, increased substantially after the robotaxi event. Tesla this month again offered FSD free for a month to its current customers, for the second time this year.

The company said in a statement earlier it remained focused on expanding its vehicle lineup, cutting costs and making critical investments in AI projects and production capacity, despite uncertain demand and rivals pulling back on EV investments.

“Preparations remain underway for our offering of new vehicles – including more affordable models – which we will begin launching in the first half of 2025,” it said.

‘SWEET SPOT’

Tesla’s third-quarter profit margin from vehicle sales, excluding regulatory credits, grew to 17.05% from 14.6% in the prior three-month period, according to Reuters calculations. Wall Street had expected 14.9%, according to 24 analysts polled by Visible Alpha.

But Tesla’s finance boss, Vaibhav Taneja, said it would be “challenging” to sustain these margins in the fourth quarter ending December.

The EV giant said that the labor and material costs of making vehicles, known as the cost of goods sold per vehicle, dropped to its lowest-ever level, about $35,100. Adjusted profit of 72 cents per share in the third quarter beat an average estimate of 58 cents.

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Mark Zuckerberg’s tech giant Meta recently dismissed 24 employees from its Los Angeles office for exploiting the company’s $25 meal voucher system to buy nonfood items such as toothpaste, laundry detergent and even wine glasses, according to employees’ posts on the anonymous workplace chat app Blind.

The vouchers, intended for food deliveries when working at the office, had been misused for ordering household items, an issue Meta addressed swiftly by terminating those involved.

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Meta, valued at $1.5 trillion, is known for its lavish perks, including free meals at its larger offices, a strategy designed to entice employees back into the workplace amid the rise of remote work. In smaller offices where on-site dining options aren’t available, employees are provided with meal credits for delivery services like Grubhub. This benefit, however, appears to have been stretched beyond its intended purpose by some staff.

According to The Financial Times, the misuse of meal vouchers had been happening for a while, with some employees regularly ordering cosmetics and groceries. Despite initial warnings, the situation persisted, leading to the recent terminations. Surprisingly, these sackings also involved some high-earning engineers with six-figure salaries.

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While the staff involved had been given prior warnings, their continued misuse ultimately resulted in their dismissals.

This news comes as Meta makes broader cuts across several divisions, including WhatsApp, Instagram and its virtual reality unit. The company cited restructuring efforts aimed at realigning resources with long-term strategic goals.

Meta spokespersons have not directly commented on the meal voucher scandal but reiterated that restructuring involves shifting teams and roles to more critical business areas.

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“Today, a few teams at Meta are making changes to ensure resources are aligned with their long-term strategic goals and location strategy,” said Meta spokesperson David Arnold in a statement. “This includes moving some teams to different locations and reallocating employees into new roles. In cases where a role is eliminated, we work hard to find new opportunities within the company.”

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