A survey of North American equities heading in both directions
Paramount Global (PARA-Q) gained after a source told Reuters that veteran media executive Edgar Bronfman has sweetened his bid to take over the company, offering US$6-billion for its controlling shareholder National Amusements and a minority stake in Paramount.
He had previously offered US$4.3-billion, according to Reuters sources.
Paramount said on Wednesday it had received an acquisition proposal from Bronfman on behalf of a consortium of investors, but it did not disclose the terms.
The competing offer for the home of Paramount Pictures, the CBS broadcast network and cable networks such as MTV threatens to undo a planned acquisition by tech scion David Ellison and his firm Skydance Media.
Bronfman’s new bid includes US$3.2-billion in funds that can be used to pay down Paramount’s debt or to purchase non-voting Paramount shares held by investors other than the Redstone family for $16 cash, the person said on condition of anonymity because the information was not public.
The board and the Bronfman-led investor group would decide how to allocate those funds, the person added.
That compares to Skydance’s US$8.4-billion deal to take over Paramount through a complex, two-step transaction that involves Paramount acquiring Mr. Ellison’s smaller independent media company in an all-stock transaction.
Zoom Video Communications (ZM-Q) increased after it raised its annual revenue forecast on Wednesday, driven by strong demand for its AI-powered collaboration tools deployed in hybrid work models, and said Kelly Steckelberg would step down as its CFO.
Zoom has been doubling down on efforts to integrate artificial intelligence into its products and expand its range of services and leverage the growing trend of hybrid work.
Zoom Contact Center, the company’s AI-powered, omnichannel platform that provides businesses personalized responses for their customers, secured several high-profile clients, including its largest single-order deal to date in the second quarter.
Zoom said large accounts, with customers contributing more than US$100,000 in trailing 12-month revenue, increased 7.1 per cent. Online average monthly churn also reached its lowest ever rate.
This suggests that Zoom is “doing more than simply holding its ground. They’re reinforcing their foundation and making sure they’re prepared for the long haul,” said Jeremy Goldman, senior director of briefings at Emarketer.
“The company needs to continue innovating and expanding its product offerings … Zoom’s challenge will be to sustain this momentum by proving they’re more than just a one-hit pandemic wonder and by continuing to deliver the kind of growth that can keep investors excited about its long-term prospects,” Goldman said.
Zoom said it has begun a search for Ms. Steckelberg’s successor. Her last day of work with the company will be the day after it announces earnings for the quarter ending Oct. 31.
Ms. Steckelberg has been Zoom’s CFO since 2017 and led the company through its successful IPO in 2019.
The company expects fiscal 2025 revenue to be between US$4.63-billion and US$4.64-billion, compared with the US$4.61-billion and $4.62 billion forecast earlier.
Its second-quarter revenue of US$1.16-billion beat LSEG estimates of US$1.15-billion.
The company earned US$1.39 per share on an adjusted basis, also topping analysts’ estimate of US$1.21.
Peloton Interactive (PTON-Q) soared after it beat Wall Street estimates for fourth-quarter revenue on Thursday, driven by the fitness-equipment maker’s partnerships and bike rental program.
The maker of high-end stationary exercise bicycles and treadmills has rolled out a turnaround plan, including job cuts, to ride out a sales slump after a pandemic-led boom.
“We achieved modest Y/Y revenue growth in Q4 for the first time since Q2 FY22,” the company said.
Peloton reported fourth-quarter revenue of US$643.6-million, above analysts’ expectations of US$630.5-million, according to LSEG data.
The company also delivered adjusted core profit and free cash flow for the second consecutive quarter.
Former CEO Barry McCarthy had pushed to achieve free cash flow by shrinking the company’s bloated cost structure and reaccelerating growth by increasing its subscriber base through its app offerings and rental bike program.
The company reported an adjusted core profit of US$70.3-million, compared to a loss of US$34.7-million a year earlier.
A US$2.6-billion provision that Toronto-Dominion Bank (TD-T) recorded to cover expected regulatory fines wiped out the lender’s fiscal third-quarter profits, leaving TD with a small loss as it works to fix lapses in its anti-money laundering program.
TD shares slid on Thursday after reporting it lost $181-million, or 14 cents per share, in the quarter that ended July 31. That compared with profit of $2.88-billion, or $1.53 per share, in the same quarter last year.
Adjusted to exclude the massive regulatory provision and other, smaller one-time items, TD said its profit was $3.65-billion. That was effectively unchanged year over year.
On an adjusted basis, the bank earned $2.05 per share, which fell just short of the $2.07 analysts had expected, according to data from the London Stock Exchange Group.
TD kept its quarterly dividend unchanged at $1.02 per share.
TD is the first of Canada’s large banks to report third-quarter earnings, with its five largest rivals set to release results from Aug. 27 to 29.
The bank set aside higher loan loss provisions of nearly $1.1-billion, anticipating that more customers could default on loans as high interest rates and a slowing job market put pressure on households and businesses. That matched analysts’ expectations, but was up 40 per cent from $766-million in the same quarter last year.
TD also recorded a $110-million restructuring charge stemming mostly from employee severance costs and efforts to trim its expenses on real estate.
TD’s stake in Schwab, a leading discount brokerage, falls to 10.1 per cent from 12.3 per cent. The bank agreed not to sell any more of its stake for 45 days, and said Wednesday that it has “no current intention to divest additional shares.”
U.S. data cloud analytics firm Snowflake (SNOW-N) raised its forecast for full-year product revenue. Still, Snowflake’s shares were down with analysts attributing the drop to the company not pairing the climb in revenue projections with a rise in margin forecast.
Snowflake executives said on a post-earnings conference call that they left the margin forecast unchanged partly due to the firm awaiting the deployments of certain GPUs.
The company now expects product revenue of US$3.36-billion for fiscal 2025, up from its prior forecast of US$3.30-billion.
It also authorized the buyback of an additional US$2.5-billion worth of the company’s shares through March 2027.
“The company’s product gross margin outlook for fiscal 2025 suggests that this (capital) pressure may persist in the second half of 2024 partially due to Snowflake offering credits to enterprise customers that experienced security breaches,” said Michael Ashley Schulman, chief investment officer at Running Point Capital.
Snowflake was the victim of a data breach earlier this year which saw large amounts of customer data stolen from firms like TicketMaster-parent Live Nation and telecom titan AT&T .
The company said the cybersecurity incident did not have an impact on product consumption.
