Potential 'Healthy Correction' For An 'Expensive' Market Looms As US Economic Growth And Earnings Slow, Says Asset Manager: S&P 500, Nasdaq Futures Trade Lower In Premarket
Ahead of the potential market correction, Brian Arcese from Foord Asset Management has highlighted concerns over the U.S. economic growth and corporate earnings. These factors could trigger a correction if they continue to slow down.
What Happened: Arcese warned that a market correction could occur if U.S. GDP or earnings growth slows. Arcese noted that the S&P 500 has been “expensive for quite a while,” with a price-to-earnings ratio exceeding 27, CNBC reported on Friday.
“We do think that a correction would be healthy, but you will need some type of catalyst for that correction to take place,” he said, highlighting two potential catalysts for a correction: slowing economic growth and inflation increases.
U.S. GDP growth was less than anticipated in the third quarter, and inflation rose to 2.6% in October, as per recent data. He emphasized that high corporate earnings expectations, particularly outside IT and communication services, could also trigger a correction if growth slows.
See Also: Dan Ives Expects ‘Drop The Mic Performance’ Tomorrow From Nvidia: Here’s Why
Arcese remarked on the unusual combination of factors like GDP growth, earnings growth, and falling inflation and interest rates, which he described as rare. He noted that while utilities are more expensive than before, they remain less costly than the broader market, with growth driven by increased electricity demand from data centers and AI advancements.
Why It Matters: The concerns raised by Arcese align with recent warnings from other financial experts. David Einhorn, founder of Greenlight Capital, recently labeled the current market as “the most expensive of all time,” citing the high Shiller cyclically adjusted price-to-earnings ratio.
Similarly, Stifel’s Barry Bannister predicted a 12% market drop by the end of 2024, driven by high valuations and speculative risks. The S&P 500’s price-to-earnings multiple is nearing historic highs, reminiscent of previous market peaks.
Despite these concerns, Goldman Sachs forecasts strong U.S. economic growth in 2025, with a 2.5% GDP boost, suggesting potential resilience in the face of current market challenges.
Price Action: As of Friday, according to Benzinga Pro, the SPDR S&P 500 ETF Trust SPY that tracks the S&P 500 closely witnessed a 25.60% increase in its year-to-date (YTD) returns while Invesco QQQ Trust, Series 1 QQQ saw a hike of 25.43%. However, during pre-market hours on Friday, both the ETFs were trading slightly lower.
On Friday, futures show a decline across major indices: Nasdaq 100 down 0.51%, S&P 500 down 0.40%, Dow Jones down 0.29%, and R2K down 0.08%.
Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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PepsiCo Strengthens Hold On US Hummus Market with Sabra & Obela Buyout
PepsiCo, Inc. PEP disclosed a deal to acquire the remaining 50% stake in Sabra Dipping Company, LLC, and PepsiCo-Strauss Fresh Dips & Spreads International GmbH for an undisclosed amount.
This acquisition will make PepsiCo the sole owner of the companies behind Sabra and Obela products.
Sabra and Obela, 50/50 joint ventures between PepsiCo and Strauss Group, focus on refrigerated dips and spreads.
PepsiCo, active in the fresh dips market for over 15 years, helped establish Sabra and Obela, with Sabra now leading the U.S. hummus market with $400 million in retail sales.
This acquisition supports PepsiCo’s goal to innovate and meet rising consumer demand for healthier options.
The transactions, pending customary closing conditions, are expected to finalize by the end of 2024.
Steven Williams, Chief Executive Officer, PepsiCo Foods North America, said, ”As we evolve our food portfolio and bring people more choices for more occasions, our aim is to meet the growing demand for positive choices and on-the-go options.”
“Nutritious, simple foods like refrigerated dips and spreads represent a space we have long desired to expand in the U.S. and Canada. We are grateful to the Strauss Group for our long and successful partnership and look forward to this next chapter for the Sabra and Obela brands, as well as the PepsiCo food portfolio.”
As of September 7, PepsiCo’s cash and equivalents stood at $7.3 billion.
Price Action: PEP shares are up 0.07% at $160.46 premarket at the last check Friday.
Photo via Shutterstock
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10 Federal Storage Reports Record Third-Quarter Results and Expands Third-Party Management Platform
RALEIGH, N.C., Nov. 22, 2024 /PRNewswire/ — 10 Federal Storage, a leader in autonomous self-storage operations, is pleased to announce record-breaking third-quarter performance, with standout growth across its offerings. Building on this success, the company is expanding its third-party management platform to a limited number of properties and select self-storage owners starting in Q1 2025. Over the past three months, 10 Federal has added 23 properties to its portfolio, demonstrating the growing demand for its proven, tech-enabled management model.
Exceptional Q3 2024 Results in a Challenging Market
In a self-storage market marked by declining street rates and reduced search demand, 10 Federal Storage has achieved remarkable performance, far exceeding industry trends. While many operators are struggling to maintain revenue and NOI growth, 10 Federal has delivered double-digit increases across both metrics in its primary offerings:
- Self-Storage Offering 3: Same-store year-to-date (YTD) revenue up 10.3% and net operating income (NOI) up 29.8% year-over-year (YoY).
- Self-Storage Offering 4: Same-store quarterly revenue up 14.3% and NOI up 38.7% YoY.
- Opportunistic Offering 1: Breaking ground on new Class-A developments in Texas and Georgia after closing a $17M equity raise in September.
“Our third-quarter results demonstrate that even in a challenging market, it’s possible to achieve exceptional outcomes through innovation and operational excellence,” said Andrew Capranos, President of 10 Federal Storage. “While many operators face compressed margins, lower street rates, and declining demand, our technology-driven approach and data-focused strategies have consistently unlocked growth opportunities and delivered superior results for our stakeholders.”
Expanding Third-Party Management Services in 2025
In response to market demand and growing dissatisfaction with traditional management services, 10 Federal Storage is opening its third-party property management platform to new applicants. The company’s proprietary system integrates AI, automation, and data-driven strategies to optimize operations, reduce costs, and enhance customer experiences.
“We’ve seen a strong appetite from self-storage owners seeking a better approach to property management,” said Jacob Mortensen, Vice President of Corporate Operations, who oversees 10 Federal’s third-party management business. “Our platform has proven its ability to deliver consistent growth even in a tougher environment, and we’re excited to bring these capabilities to forward-thinking owners who want to maximize the potential of their properties.”
Partnering with Select Owners
10 Federal Storage will accept a limited number of properties and owners to join its proprietary, automated third-party management platform starting in Q1 2025. This strategic approach ensures the company can maintain its high standards of service and deliver exceptional performance across its growing portfolio.
About 10 Federal Storage
10 Federal Storage is a leading operator of automated self-storage properties across the United States, managing over 80 facilities nationwide. By integrating proprietary autonomous management technologies, including artificial intelligence and advanced automation, the company streamlines operations, enhances customer experiences, and maximizes profitability, redefining self-storage management for the modern era.
Recognized as a pioneer in remotely managed properties, 10 Federal leverages data analytics and automation to set new standards in efficiency and customer service within the self-storage industry. The company has been honored as an Inc. 5000 Fastest Growing Company in America, an Inside Self-Storage (ISS) Top 100 Operator, a Top Performing Real Estate Fund by Preqin, and a Top Fundraiser by Juniper Square. As one of the largest owners and operators of fully automated self-storage facilities in the U.S., 10 Federal’s innovative systems deliver superior risk-adjusted investor returns.
Corporate Contact:
Jacob Mortensen
Vice President of Corporate Operations
10 Federal Storage
Email: Communications@10Federal.com
Website: 10federalstorage.com
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Prediction: Nvidia Stock Is Going to Soar Over the Next 12 Months
Nvidia (NASDAQ: NVDA) is the world’s leading supplier of graphics processing units (GPUs) for data centers, which are used in the development of artificial intelligence (AI). Over the last two years alone, GPU sales have helped Nvidia add $3.2 trillion to its valuation.
The company just reported results for the fiscal 2025 third quarter (ended Oct. 27) after the market closed on Nov. 20, and they obliterated Wall Street’s expectations. It just started shipping a new generation of GPUs based on its powerful Blackwell architecture, and demand is heavily outstripping supply.
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Nevertheless, the stock sank 2.5% in after-hours trading following the third-quarter report. I predict shares are going to soar over the next 12 months, so here’s why any weakness might be a buying opportunity.
In the past, data centers were built with central processing units (CPUs), which were great for handling a small number of specific tasks with high efficiency. However, GPUs are designed for parallel processing, meaning they can handle numerous tasks at the same time with a very high throughput.
That’s crucial when it comes to training AI models and performing AI inference, because those workloads require chips that can rapidly absorb and process trillions of data points.
GPUs built on Nvidia’s Hopper architecture — like the H100 and H200 — have been the go-to choice for AI development so far. Data center operators like Microsoft and Amazon buy tens of thousands of those GPUs and rent their computing power to businesses and AI developers, which can’t afford to build their own infrastructure (a single H100 can sell for up to $40,000).
Now, a new age of AI computing has arrived with Nvidia’s Blackwell GPU architecture. The Blackwell-based GB200 NVL72 system can perform AI inference 30 times faster than the equivalent H100 system.
A recent estimate suggests an individual GB200 GPU within an NVL72 system costs around $83,333, so developers are getting that 30-fold increase in AI inference performance for a mere twofold increase in price compared to the H100.
In other words, the Blackwell GPUs should drive an incredible increase in cost efficiency, so more businesses and developers can afford to deploy the most advanced AI large language models (LLMs).
Nvidia shipped 13,000 Blackwell GPU samples to customers during the third quarter. Microsoft, Dell, and CoreWeave have already started building Blackwell-based data centers, and Oracle customers will soon be able to access computing clusters with a staggering 131,000 Blackwell GPUs.
Markets Misread Trump Win, Says Ex-Goldman Sachs Analyst: 'Prospects Of Tariffs Not Good For Equities'
As the U.S. dollar scaled a fresh 52-week high on Friday morning at 108.071 level, former Goldman Sachs FX strategist and senior fellow at Brookings Institution, Robin Brooks said in an X (formerly Twitter) post that, “Markets initially got this wrong, driving stocks up sharply right after Nov. 5.”
He added that “the prospect of tariffs isn’t obviously good for equities, while it’s clearly good for the Dollar. More Dollar strength is coming.”
What Happened: A chart shared by Brooks compared the S&P 500 Index and the Dollar Index during President-elect Donald Trump’s victory in 2016 and 2024. Measuring the performance of both indices from the day of the election on Nov. 5, the Dollar Index has risen by approximately 3.5%, outperforming the S&P 500 Index, which advanced 2.9%.
Why It Matters: An increase in tariffs reduces the demand for imported goods and lifts domestic prices above the free trade price, gradually stoking inflation. This results in monetary tightening affecting the equities in the long run.
However, higher tariffs are positive for the domestic currency as its supply decreases and more money flows into the economy.
What Are Other Analysts Saying: Now that the Dollar Index has surpassed its previous 52-week high of 107.07, “a break of it may let it test 108.60 while 105.10 acting as a support,” said Kunal Sodhani, vice president of the global trading center at Shinhan Bank.
According to him, “the ongoing geopolitical tensions in the Middle East combined with the strong U.S. economic data and the Federal Reserve’s cautious rhetoric on interest rate cuts, may push the U.S. Dollar to new highs”
As of Friday, the SPDR S&P 500 ETF Trust SPY had gained 25.60% year-to-date, while the Invesco QQQ Trust, Series 1 QQQ saw a 25.43% increase, according to Benzinga Pro. Despite these strong returns, both ETFs were slightly down in pre-market trading on Friday.
Meanwhile, the futures show a decline across major indices: Nasdaq 100 down 0.51%, S&P 500 down 0.40%, Dow Jones down 0.29%, and R2K down 0.08%.
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Scilex Holding Company Announces Receipt of Notice from Nasdaq
PALO ALTO, Calif., Nov. 22, 2024 (GLOBE NEWSWIRE) — Scilex Holding Company SCLX “Scilex” or the “Company”)), an innovative revenue-generating company focused on acquiring, developing and commercializing non-opioid pain management products for the treatment of acute and chronic pain, today reported that it received a notice (the “Notice”) on November 21, 2024 from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) advising the Company that it was not in compliance with Nasdaq’s continued listing requirements under the Nasdaq Listing Rule 5250(c)(1) (the “Listing Rule”) as a result of its failure to file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 (the “Q3 Form 10-Q”) in a timely manner.
Under Nasdaq rules, the Company has 60 calendar days from receipt of the Notice or until January 20, 2025, to submit a plan to regain compliance with the Listing Rule. If Nasdaq accepts the Company’s plan, then Nasdaq may grant an exception of up to 180 calendar days from the due date of the Q3 Form 10-Q, or until May 19, 2025, to regain compliance.
In response to the Notice, the Company intends to file the Q3 Form 10-Q as soon as possible in order to regain compliance with the Listing Rule. However, if the Company does not submit the Q3 Form 10-Q by January 20, 2025, the Company will submit a plan by such date to Nasdaq that outlines, as definitively as possible, the steps the Company will take to promptly file the Q3 Form 10-Q.
For more information on Scilex Holding Company, refer to www.scilexholding.com.
For more information on Scilex Holding Company Sustainability Report, refer to www.scilexholding.com/investors/sustainability.
For more information on ZTlido® including Full Prescribing Information, refer to www.ztlido.com.
For more information on ELYXYB®, including Full Prescribing Information, refer to www.elyxyb.com.
For more information on Gloperba®, including Full Prescribing Information, refer to www.gloperba.com.
https://www.facebook.com/scilex.pharm
https://www.linkedin.com/company/scilex-holding-company/
About Scilex Holding Company
Scilex Holding Company is an innovative revenue-generating company focused on acquiring, developing and commercializing non-opioid pain management products for the treatment of acute and chronic pain. Scilex targets indications with high unmet needs and large market opportunities with non-opioid therapies for the treatment of patients with acute and chronic pain and are dedicated to advancing and improving patient outcomes. Scilex’s commercial products include: (i) ZTlido® (lidocaine topical system) 1.8%, a prescription lidocaine topical product approved by the U.S. Food and Drug Administration (the “FDA”) for the relief of neuropathic pain associated with postherpetic neuralgia, which is a form of post-shingles nerve pain; (ii) ELYXYB®, a potential first-line treatment and the only FDA-approved, ready-to-use oral solution for the acute treatment of migraine, with or without aura, in adults; and (iii) Gloperba®, the first and only liquid oral version of the anti-gout medicine colchicine indicated for the prophylaxis of painful gout flares in adults.
In addition, Scilex has three product candidates: (i) SP-102 (10 mg, dexamethasone sodium phosphate viscous gel) (“SEMDEXATM” or “SP-102”), a novel, viscous gel formulation of a widely used corticosteroid for epidural injections to treat lumbosacral radicular pain, or sciatica, for which Scilex has completed a Phase 3 study and was granted Fast Track status from the FDA in 2017; (ii) SP-103 (lidocaine topical system) 5.4%, (“SP-103”), a next-generation, triple-strength formulation of ZTlido, for the treatment of acute pain and for which Scilex has recently completed a Phase 2 trial in acute low back pain. SP-103 has been granted Fast Track status from the FDA in low back pain; and (iii) SP-104 (4.5 mg, low-dose naltrexone hydrochloride delayed-release capsules) (“SP-104”), a novel low-dose delayed-release naltrexone hydrochloride being developed for the treatment of fibromyalgia, for which Phase 1 trials were completed in the second quarter of 2022.
Scilex Holding Company is headquartered in Palo Alto, California.
Forward-Looking Statements
This press release and any statements made for and during any presentation or meeting concerning the matters discussed in this press release contain forward-looking statements related to Scilex and its subsidiaries under the safe harbor provisions of Section 21E of the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Forward-looking statements include statements relating to the filing of the Q3 Form 10-Q and the Company’s ability to regain compliance with the Nasdaq continued listing standards, and the Company’s development and commercialization plans.
Risks and uncertainties that could cause Scilex’s actual results to differ materially and adversely from those expressed in our forward-looking statements, include, but are not limited to: risks related to the engagement by the Audit Committee of the Company’s Board of Directors of a new independent registered public accounting firm, including the timing thereof, the Company’s ability to file the Q3 Form 10-Q; risks related to the Company’s ability to regain compliance with the Nasdaq continued listing standards and to maintain the listing of the Company’s securities thereon; the risk of litigation or other actions arising from the failure to timely file the Q3 Form 10-Q or any subsequent SEC filing; risks associated with the unpredictability of trading markets; general economic, political and business conditions; the risk that the potential product candidates that Scilex develops may not progress through clinical development or receive required regulatory approvals within expected timelines or at all; risks relating to uncertainty regarding the regulatory pathway for Scilex’s product candidates; the risk that Scilex will be unable to successfully market or gain market acceptance of its product candidates; the risk that Scilex’s product candidates may not be beneficial to patients or successfully commercialized; the risk that Scilex has overestimated the size of the target patient population, their willingness to try new therapies and the willingness of physicians to prescribe these therapies; risks that the outcome of the trials and studies for SP-102, SP-103 or SP-104 may not be successful or reflect positive outcomes; risks that the prior results of the clinical and investigator-initiated trials of SP-102 (SEMDEXA™), SP-103 or SP-104 may not be replicated; regulatory and intellectual property risks; and other risks and uncertainties indicated from time to time and other risks described in Scilex’s most recent periodic reports filed with the Securities and Exchange Commission, including Scilex’s Annual Report on Form 10-K for the year ended December 31, 2023 and subsequent Quarterly Reports on Form 10-Q that the Company has filed or may file, including the risk factors set forth in those filings. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release, and Scilex undertakes no obligation to update any forward-looking statement in this press release except as may be required by law.
Contacts:
Investors and Media
Scilex Holding Company
960 San Antonio Road
Palo Alto, CA 94303
Office: (650) 516-4310
Email: investorrelations@scilexholding.com
Website: www.scilexholding.com
SEMDEXA™ (SP-102) is a trademark owned by Semnur Pharmaceuticals, Inc., a wholly-owned subsidiary of Scilex Holding Company. A proprietary name review by the FDA is planned.
ZTlido® is a registered trademark owned by Scilex Pharmaceuticals Inc., a wholly-owned subsidiary of Scilex Holding Company.
Gloperba® is the subject of an exclusive, transferable license to Scilex Holding Company to use the registered trademark.
ELYXYB® is a registered trademark owned by Scilex Holding Company.
All other trademarks are the property of their respective owners.
© 2024 Scilex Holding Company All Rights Reserved.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
US Stocks Set To Open Lower On Friday As Investors Eye Cyclical Stocks: Trump's Treasury Pick In Focus, Expert Says Case For Fed Pause In December 'Getting Stronger'
U.S. stocks could open on a negative note on Friday after futures showed tentativeness on Friday. Investors turned their focus to cyclical stocks and themes, moving on from their focus on the Trump trade after the election results.
Futures of the three major indices were mixed, with the Nasdaq heading lower after AI giant Nvidia Corp. NVDA posted its highly-anticipated third-quarter results.
| Futures | Change (+/-) |
| Nasdaq 100 | -0.51% |
| S&P 500 | -0.40% |
| Dow Jones | -0.29% |
| R2K | -0.08% |
In premarket trading on Friday, the SPDR S&P 500 ETF Trust SPY edged lower by 0.34% to $591.68 and the Invesco QQQ ETF QQQ declined 0.39% to $503.03, according to Benzinga Pro data.
Cues From Last Session:
U.S. stocks ended Thursday in the green, with the Dow Jones surging by over 450 points, while the tech-heavy Nasdaq registered marginal gains.
Crude oil futures continued on their upward trajectory amid rising tensions between Russia and Ukraine.
Treasury yields eased marginally on mixed data and the declining probability of the Federal Open Market Committee (FOMC) cutting interest rates in December.
On the economic data front, U.S. existing home sales gained 3.5% from the previous month to an annualized rate of 3.96 million in October. The Philadelphia Fed Manufacturing Index fell to -5.5 in November from 10.3 in the previous month, and compared to market estimates of 8.
Initial jobless claims declined by 6,000 from the previous week to 213,000 in the week ending Nov. 16.
Most sectors on the S&P 500 closed on a positive note, with utilities, financials, and consumer staples stocks recording the biggest gains on Thursday.
However, consumer discretionary and communication services stocks bucked the overall market trend, closing the session lower.
| Index | Performance (+/-) | Value |
| Nasdaq Composite | 0.03% | 18,972.42 |
| S&P 500 | 0.53% | 5,948.71 |
| Dow Jones | 1.06% | 43,870.35 |
| Russell 2000 | 1.65% | 2,364.02 |
Insights From Analysts:
Powell’s relatively hawkish tone has investors cautious in the markets. With the Trump trade losing steam, the focus is now on the President-elect’s Treasury pick.
“In focus currently is President-elect Trump’s pick for the influential post of US Treasury Secretary. Given the large US budget deficit, investors will probably want to see a safe pair of hands being chosen,” ING analysts said in a note.
With the next rate cut now a coin toss, the U.S. dollar could see a correction. According to ING analyst Francesco Pesole, the dollar is “testing the limit” of its longs and traders should exercise caution for the time being.
“Powell seemed to put greater emphasis on the strength of the economy and how that allows the central bank to approach the upcoming policy decisions ‘carefully’.”
CME Group’s FedWatch tool reflected the fall in sentiment for another rate cut next month, with its probability declining to 59.6% from 72.2%.
“The case for a Fed pause in December is getting stronger and Fed officials are communicating that they are open to it going into the next meeting,” Kathy Jones, chief fixed income strategist at Schwab, said in a recent note.
“It will come down to employment and inflation data.”
See Also: How To Trade Futures
Upcoming Economic Data
Friday’s major economic updates include:
- S&P U.S. Services and Manufacturing Purchasing Manager’s Index will be released at 9:45 a.m. ET.
- Consumer sentiment data will be released at 10 a.m. ET.
- Fed Gov. Michelle Bowman will speak at 6:15 p.m. ET.
Stocks In Focus:
- The Gap Inc. GAP stock surged 15% in premarket trading after the retailer raised its annual target with a “strong” outlook for the holiday season.
- MicroStrategy Inc. MSTR stock surged over 2% in premarket trading on Friday as Bitcoin BTC/USD inched closer to the $100,000 mark. Robinhood Markets Inc. HOOD stock was also up over 0.5%.
- Reddit Inc. RDDT stock fell over 7% in premarket trading after the social media company amid Advance’s stake sale announcement.
- Alphabet Inc. GOOG GOOGL stock fell over 4.7% on Thursday after the U.S. Department of Justice (DOJ) pushed forward with its demands for Google to divest the Chrome web browser.
- Investors are awaiting earnings results from Destination XL Group, Inc. DXLG and Global Blue Group Holding AG GB today.
Commodities, Bonds And Global Equity Markets:
Crude oil futures rose in the early New York session, surging by 0.61% to hover around $70.54 per barrel.
The 10-year Treasury note yield eased to 4.396%.
Most of the major Asian markets ended in the green on Friday, but European markets were mixed in early trading.
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Qudian Inc. Reports Third Quarter 2024 Unaudited Financial Results
XIAMEN, China, Nov. 22, 2024 /PRNewswire/ — Qudian Inc. (“Qudian” or “the Company” or “We”) QD, a consumer-oriented technology company in China, today announced its unaudited financial results for the quarter ended September 30, 2024.
Third Quarter 2024 Financial Highlights:
- Total revenues were RMB55.0 million (US$7.8 million), compared to RMB29.6 million for the same period of last year
- Net income attributable to Qudian’s shareholders was RMB131.9 million (US$18.8 million), compared to net loss of RMB181.2 million for the same period of last year; net income per diluted ADS was RMB0.71 (US$0.10) for the third quarter of 2024
- Non-GAAP net income attributable to Qudian’s shareholders was RMB131.9 million (US$18.8 million), compared to Non-GAAP net loss of RMB179.8 million for the same period of last year. We exclude share-based compensation expenses from our non-GAAP measures. Non-GAAP net income per diluted ADS was RMB0.71 (US$0.10) for the third quarter of 2024
The Company’s last-mile delivery business continued to make steady progress in 2024, which generated approximately RMB53.5 million in revenue in the third quarter of 2024, compared to RMB28.6 million for the third quarter of 2023. Moving forward, the Company expects to remain steadfast in its commitment to executing its business transition and simultaneously maintaining prudent cash management to safeguard its balance sheet.
Third Quarter Financial Results
Sales income and others increased by 85.9% to RMB55.0 million (US$7.8 million) from RMB29.6 million for the third quarter of 2023, which was primarily attributable to the increase in sales income generated from last-mile delivery business.
Total operating costs and expenses decreased to RMB122.0 million (US$17.4 million) from RMB141.1 million for the third quarter of 2023.
Cost of revenues increased by 5.7% to RMB48.9 million (US$7.0 million) from RMB46.3 million for the third quarter of 2023, primarily due to the increase in service cost related to last-mile delivery business.
General and administrative expenses decreased by 27.5% to RMB58.6 million (US$8.3 million) from RMB80.8 million for the third quarter of 2023, primarily due to the reduce in professional services fees after the Company completed research and consultation for last-mile delivery business in its early stage.
Research and development expenses increased by 29.3% to RMB14.6 million (US$2.1 million) from RMB11.3 million for the third quarter of 2023, primarily due to the increase in staff salaries as the Company continues to explore new business opportunities.
Loss from operations was RMB67.0 million (US$9.5 million), compared to RMB100.8 million for the third quarter of 2023.
Interest and investment income, net was RMB228.4 million (US$32.6 million), compared to interest and investment loss of RMB7.1 million for the third quarter of 2023, primarily attributable to the increase of income from investments in the third quarter of 2024.
Gain on derivative instrument was RMB30.2 million (US$4.3 million), compared to loss on derivative instrument of RMB108.0 million for the third quarter of 2023, mainly attributable to the increase in quoted price of the underlying equity securities relating to the derivative instruments we held.
Net income attributable to Qudian’s shareholders was RMB131.9 million (US$18.8 million), compared to net loss attributable to Qudian’s shareholders of RMB181.2 million in the third quarter of 2023. Net income per diluted ADS was RMB0.71 (US$0.10).
Non-GAAP net income attributable to Qudian’s shareholders was RMB131.9 million (US$18.8 million), compared to Non-GAAP net loss attributable to Qudian’s shareholders of RMB179.8 in the third quarter of 2023. Non-GAAP net income per diluted ADS was RMB0.71 (US$0.10).
Cash Flow
As of September 30, 2024, the Company had cash and cash equivalents of RMB4,847.0 million (US$690.7 million) and restricted cash of RMB779.5 million (US$111.1 million). Restricted cash mainly represents security deposits held in designated bank accounts for the guarantee of short-term borrowings. Such restricted cash is not available to fund the general liquidity needs of the Company.
For the third quarter of 2024, net cash provided by operating activities was RMB679.9 million (US$96.9 million), mainly due to the net proceeds from redemption of time and structured deposit. Net cash used in investing activities was RMB541.8 million (US$77.2 million), mainly due to payments of deposit pledged as collateral for derivative instrument. Net cash provided by financing activities was RMB638.0 million (US$90.9 million), mainly due to the proceeds from short-term borrowings and partially offset by the repurchase of ordinary shares.
Last-mile Delivery Business
In response to the surging demand for cross-border e-commerce transactions, the Company has proactively sought innovative logistic services and solutions to meet global consumers’ expectations for swift and top-tier delivery services. In December 2022, the Company launched its last-mile delivery services under the brand name of “Fast Horse.” The business was initially launched on a trial basis and has gradually achieved meaningful scale in Australia during the second quarter of 2023. As of the date of this release, the Company’s last-mile delivery service is available in Australia and New Zealand.
Update on Share Repurchase
Our Board approved a share repurchase program in March 2024 to purchase up to US$300 million worth of Class A ordinary shares or ADSs in the next 36 months starting from June 13, 2024. From the launch of the share repurchase program on June 13, 2024 to November 18, 2024, the Company has in aggregate purchased 12.1 million ADSs in the open market for a total amount of approximately US$25.3 million (an average price of $2.1 per ADS) pursuant to the share repurchase program.
As of November 18, 2024, the Company had in aggregate purchased 166.4 million ADSs for a total amount of approximately US$719.5 million (an average price of $4.3 per ADS).
About Qudian Inc.
Qudian Inc. (“Qudian”) is a consumer-oriented technology company. The Company historically focused on providing credit solutions to consumers. Qudian is exploring innovative logistics services to satisfy consumers’ demand for e-commerce transactions by leveraging its technology capabilities.
For more information, please visit http://ir.qudian.com.
Use of Non-GAAP Financial Measures
We use Non-GAAP net income/loss attributable to Qudian’s shareholders, a Non-GAAP financial measure, in evaluating our operating results and for financial and operational decision-making purposes. We believe that Non-GAAP net income/loss attributable to Qudian’s shareholders helps identify underlying trends in our business by excluding the impact of share-based compensation expenses, which are non-cash charges. We believe that Non-GAAP net income/loss attributable to Qudian’s shareholders provides useful information about our operating results, enhances the overall understanding of our past performance and future prospects and allows for greater visibility with respect to key metrics used by our management in its financial and operational decision-making.
Non-GAAP net income/loss attributable to Qudian’s shareholders is not defined under U.S. GAAP and is not presented in accordance with U.S. GAAP. This Non-GAAP financial measure has limitations as an analytical tool, and when assessing our operating performance, cash flows or our liquidity, investors should not consider them in isolation, or as a substitute for net loss /income, cash flows provided by operating activities or other consolidated statements of operation and cash flow data prepared in accordance with U.S. GAAP.
We mitigate these limitations by reconciling the Non-GAAP financial measure to the most comparable U.S. GAAP performance measure, all of which should be considered when evaluating our performance.
For more information on this Non-GAAP financial measure, please see the table captioned “Unaudited Reconciliation of GAAP and Non-GAAP Results” set forth at the end of this press release.
Exchange Rate Information
This announcement contains translations of certain RMB amounts into U.S. dollars (“US$”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to US$ were made at the rate of RMB7.0176 to US$1.00, the noon buying rate in effect on September 30, 2024, in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.
Statement Regarding Preliminary Unaudited Financial Information
The unaudited financial information set out in this earnings release is preliminary and subject to potential adjustments. Adjustments to the consolidated financial statements may be identified when audit work has been performed for the Company’s year-end audit, which could result in significant differences from this preliminary unaudited financial information.
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Among other things, the expectation of its collection efficiency and delinquency, contain forward-looking statements. Qudian may also make written or oral forward-looking statements in its periodic reports to the SEC, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Qudian’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Qudian’s goal and strategies; Qudian’s expansion plans; Qudian’s future business development, financial condition and results of operations; Qudian’s expectations regarding demand for, and market acceptance of, its products; Qudian’s expectations regarding keeping and strengthening its relationships with customers, business partners and other parties it collaborates with; general economic and business conditions; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Qudian’s filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Qudian does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
For investor and media inquiries, please contact:
In China:
Qudian Inc.
Tel: +86-592-596-8208
E-mail: ir@qudian.com
|
QUDIAN INC. |
||||||
|
Unaudited Condensed Consolidated Statements of Operations |
||||||
|
Three months ended September 30, |
||||||
|
(In thousands except for number |
2023 |
2024 |
||||
|
of shares and per-share data) |
(Unaudited) |
(Unaudited) |
||||
|
RMB |
RMB |
US$ |
||||
|
Revenues: |
||||||
|
Sales income and others |
29,598 |
55,015 |
7,840 |
|||
|
Total revenues |
29,598 |
55,015 |
7,840 |
|||
|
Operating cost and expenses: |
||||||
|
Cost of revenues |
(46,279) |
(48,913) |
(6,970) |
|||
|
Sales and marketing |
– |
(2,123) |
(303) |
|||
|
General and administrative |
(80,796) |
(58,580) |
(8,348) |
|||
|
Research and development |
(11,277) |
(14,576) |
(2,077) |
|||
|
Expected credit (loss)/reversal for receivables and other assets |
(3,974) |
2,798 |
399 |
|||
|
Impairment gain/(loss) from other assets |
1,258 |
(604) |
(86) |
|||
|
Total operating cost and expenses |
(141,068) |
(121,998) |
(17,385) |
|||
|
Other operating income |
10,668 |
– |
– |
|||
|
Loss from operations |
(100,802) |
(66,983) |
(9,545) |
|||
|
Interest and investment (loss)/income, net |
(7,099) |
228,420 |
32,550 |
|||
|
Gain/(Loss) from equity method investments |
1,010 |
(1,390) |
(198) |
|||
|
(Loss)/Gain on derivative instruments |
(107,969) |
30,246 |
4,310 |
|||
|
Foreign exchange gain/(loss), net |
274 |
(7,898) |
(1,125) |
|||
|
Other income |
10,694 |
2,030 |
289 |
|||
|
Other expenses |
(2,157) |
(13,809) |
(1,968) |
|||
|
Net (loss)/income before income taxes |
(206,049) |
170,616 |
24,313 |
|||
|
Income tax expenses |
24,821 |
(38,702) |
(5,515) |
|||
|
Net (loss)/income |
(181,228) |
131,914 |
18,798 |
|||
|
Net (loss)/income attributable to Qudian Inc.’s |
(181,228) |
131,914 |
18,798 |
|||
|
(Loss)/Earnings per share for Class A and Class B |
||||||
|
Basic |
(0.84) |
0.73 |
0.10 |
|||
|
Diluted |
(0.84) |
0.71 |
0.10 |
|||
|
(Loss)/Earnings per ADS (1 Class A ordinary share |
||||||
|
Basic |
(0.84) |
0.73 |
0.10 |
|||
|
Diluted |
(0.84) |
0.71 |
0.10 |
|||
|
Weighted average number of Class A and Class B |
||||||
|
Basic |
214,666,223 |
180,111,125 |
180,111,125 |
|||
|
Diluted |
214,666,223 |
185,092,607 |
185,092,607 |
|||
|
Other comprehensive loss: |
||||||
|
Foreign currency translation adjustment |
(1,471) |
(60,991) |
(8,691) |
|||
|
Total comprehensive (loss)/income |
(182,699) |
70,923 |
10,107 |
|||
|
Total comprehensive (loss)/income attributable to |
(182,699) |
70,923 |
10,107 |
|||
|
QUDIAN INC. |
||||||
|
Unaudited Condensed Consolidated Balance Sheets |
||||||
|
As of June 30, |
As of September 30, |
|||||
|
(In thousands except for number |
2024 |
2024 |
||||
|
of shares and per-share data) |
(Unaudited) |
(Unaudited) |
||||
|
RMB |
RMB |
US$ |
||||
|
ASSETS: |
||||||
|
Current assets: |
||||||
|
Cash and cash equivalents |
4,849,019 |
4,847,011 |
690,694 |
|||
|
Restricted cash |
51,984 |
779,529 |
111,082 |
|||
|
Time and structured deposit |
2,948,606 |
1,988,626 |
283,377 |
|||
|
Short-term investments |
1,091,177 |
485,814 |
69,228 |
|||
|
Accounts receivables |
39,418 |
38,492 |
5,485 |
|||
|
Other current assets |
615,275 |
2,104,961 |
299,955 |
|||
|
Total current assets |
9,595,479 |
10,244,433 |
1,459,821 |
|||
|
Non-current assets: |
||||||
|
Right-of-use assets |
163,246 |
163,539 |
23,304 |
|||
|
Investment in equity method investee |
150,691 |
148,701 |
21,190 |
|||
|
Long-term investments |
210,448 |
83,987 |
11,968 |
|||
|
Property and equipment, net |
1,410,125 |
1,450,975 |
206,762 |
|||
|
Intangible assets |
2,764 |
1,668 |
238 |
|||
|
Other non-current assets |
469,476 |
459,272 |
65,446 |
|||
|
Total non-current assets |
2,406,750 |
2,308,142 |
328,908 |
|||
|
TOTAL ASSETS |
12,002,229 |
12,552,575 |
1,788,729 |
|||
|
QUDIAN INC. |
||||||
|
Unaudited Condensed Consolidated Balance Sheets (Continued) |
||||||
|
As of June 30, |
As of September 30, |
|||||
|
(In thousands except for number |
2024 |
2024 |
||||
|
of shares and per-share data) |
(Unaudited) |
(Unaudited) |
||||
|
RMB |
RMB |
US$ |
||||
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
||||||
|
Current liabilities: |
||||||
|
Short-term borrowings and interest payables |
– |
720,000 |
102,599 |
|||
|
Short-term lease liabilities |
19,789 |
19,853 |
2,829 |
|||
|
Derivative instruments-liability |
248,228 |
85,795 |
12,226 |
|||
|
Accrued expenses and other current liabilities |
202,856 |
188,209 |
26,820 |
|||
|
Income tax payable |
25,947 |
33,728 |
4,806 |
|||
|
Total current liabilities |
496,820 |
1,047,585 |
149,280 |
|||
|
Non-current liabilities: |
||||||
|
Long-term lease liabilities |
51,432 |
51,661 |
7,362 |
|||
|
Total non-current liabilities |
51,432 |
51,661 |
7,362 |
|||
|
Total liabilities |
548,252 |
1,099,246 |
156,642 |
|||
|
Shareholders’ equity: |
||||||
|
Class A Ordinary shares |
132 |
132 |
19 |
|||
|
Class B Ordinary shares |
44 |
44 |
6 |
|||
|
Treasury shares |
(1,196,636) |
(1,263,641) |
(180,067) |
|||
|
Additional paid-in capital |
4,031,438 |
4,026,876 |
573,825 |
|||
|
Accumulated other comprehensive loss |
14,434 |
(46,556) |
(6,634) |
|||
|
Retained earnings |
8,604,565 |
8,736,474 |
1,244,938 |
|||
|
Total shareholders’ equity |
11,453,977 |
11,453,329 |
1,632,087 |
|||
|
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY |
12,002,229 |
12,552,575 |
1,788,729 |
|||
|
QUDIAN INC. |
|||||||
|
Unaudited Reconciliation of GAAP And Non-GAAP Results |
|||||||
|
Three months ended September 30, |
|||||||
|
2023 |
2024 |
||||||
|
(In thousands except for number |
(Unaudited) |
(Unaudited) |
|||||
|
of shares and per-share data) |
RMB |
RMB |
US$ |
||||
|
Total net (loss)/income attributable to Qudian Inc.’s shareholders |
(181,228) |
131,914 |
18,798 |
||||
|
Add: Share-based compensation expenses |
1,432 |
– |
– |
||||
|
Non-GAAP net (loss)/income attributable to Qudian Inc.’s shareholders |
(179,796) |
131,914 |
18,798 |
||||
|
Non-GAAP net (loss)/income per share—basic |
(0.84) |
0.73 |
0.10 |
||||
|
Non-GAAP net (loss)/income per share—diluted |
(0.84) |
0.71 |
0.10 |
||||
|
Weighted average shares outstanding—basic |
214,666,223 |
180,111,125 |
180,111,125 |
||||
|
Weighted average shares outstanding—diluted |
214,666,223 |
185,092,607 |
185,092,607 |
||||
View original content:https://www.prnewswire.com/news-releases/qudian-inc-reports-third-quarter-2024-unaudited-financial-results-302314038.html
SOURCE Qudian Inc.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
SpaceX CEO Elon Musk Explains How Starship's Engine Design Prevents Chain Failures Unlike Soviet N1 Rocket
The Starship‘s many engines are isolated from each other, preventing the risk of one engine failure causing failure of all as in the case of the Soviet Union’s N1 rocket, SpaceX CEO Elon Musk said on Thursday.
What Happened: “If engine failures are isolated from each other and the primary airframe, then more engines *increases* reliability,” Musk said in a post on social media platform X. “The problem with N-1 was that a failure of any engine caused failure of all.”
The Starship has often been compared to the Soviet N1 rocket owing to its large number of engines. Musk himself has admitted that the N1 is the closest comparable rocket to Starship. However, the Starship has 33 engines on its Super Heavy booster, even more than the 30 engines on the Soviet N1’s first stage.
About N1: N1 was aimed at enabling crewed travel to the moon. However, all four attempts to launch failed and the program was suspended in 1974.
The Soviets carried out a clandestine launch of the N1 on July 3, 1969, which ended up in a colossal explosion. This effectively knocked out the Soviet Union from the Moon race just days before U.S. astronauts walked on the surface of the moon.
About Starship: Starship is SpaceX’s most ambitious launch vehicle aimed at taking humans back to the Moon and Earth’s neighboring planet Mars.
The company has conducted six test flights of the vehicle thus far but without a payload. The last flight test took place earlier this week and NASA is looking forward to taking humans back to the surface of the Moon after a gap of over 50 years with the help of a custom version of Starship.
Check out more of Benzinga’s Future Of Mobility coverage by following this link.
Read Next:
Photo courtesy: SpaceX
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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
BiT Global Accuses Coinbase of Delisting wBTC To Propel Rival cbBTC in Heated Crypto Battle
BiT Global has accused Coinbase of suspending trading of Wrapped Bitcoin (wBTC) on Dec. 19 to boost its own Bitcoin wrapper, Coinbase Wrapped BTC (cbBTC). The Hong Kong-based exchange, which recently gained partial control over wBTC’s Bitcoin custodian, claims that Coinbase’s decision aims to eliminate competition for cbBTC, which launched in September.
The delisting of wBTC, the most popular Bitcoin wrapper with over $14 billion in total value locked (TVL), follows a statement from Coinbase on Nov. 19 citing “failures to meet listing standards.” However, BiT Global argues that this move is a strategy to favor Coinbase’s new wrapped Bitcoin product, cbBTC. “It’s clear that Coinbase is pushing forward their own wrapped Bitcoin product while removing wBTC, the largest competitor,” said a spokesperson from BiT Global.
Coinbase has denied these claims. A Coinbase spokesperson stated that the delisting was based on a regular review process. “Each asset is reviewed independently to meet our listing standards. wBTC no longer meets these standards,” they said.
Bitcoin wrappers like wBTC and cbBTC are used to represent Bitcoin on other blockchain networks, allowing for broader use in decentralized finance (DeFi). Despite the dispute, wBTC remains the dominant player in the market, while Coinbase’s cbBTC has also gained traction, currently holding $1.5 billion in TVL.
The situation has been further complicated by BiT Global’s recent involvement with wBTC’s custodian, BitGo. In August, BitGo allowed BiT Global partial control of the multisignature wallet securing wBTC’s Bitcoin backing. The move raised concerns due to the involvement of Justin Sun, a figure known for controversies in the crypto space. Some in the community have voiced worries about the potential mismanagement of funds in projects associated with Sun, including BiT Global.
Coinbase’s decision to delist wBTC has drawn criticism from some corners of the crypto community. BiT Global insists that this move strips investors of their right to choose the Bitcoin wrapper that best suits their needs. “Coinbase has elected to strip investors of that decision,” the spokesperson added.
Although wBTC still leads the market, with a larger TVL than cbBTC, the competition between the two Bitcoin wrappers is intensifying. This comes as Coinbase CEO Brian Armstrong is scheduled to meet with President-elect Donald Trump to discuss possible appointments and policies that could influence the cryptocurrency market.
As the debate around wrapped Bitcoin continues, industry stakeholders remain divided on whether Coinbase’s actions will shape the future of Bitcoin representation in DeFi.