WEBVTT - Intel Plunges, Amazon and Reddit Fall

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio, news.

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<v Speaker 2>The Stock Movers Report, your roundup of companies making moves

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<v Speaker 2>in the stock market, harnessing the power of Bloomberg data.

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<v Speaker 3>I'm Tim Stenevek, along with Carol Masser. Let's take a

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<v Speaker 3>look at some stocks on the move today. Should we

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<v Speaker 3>start with Intel? And we got some serious stocks on

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<v Speaker 3>the move. Let's start with Intel, yeah.

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<v Speaker 1>Yeah, ticker is INTC. Folks, that stock is down more

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<v Speaker 1>than 15%. As we speak here in the aftermarket, we

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<v Speaker 1>are seeing the stock plunge. This happening after a PC

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<v Speaker 1>slump in supply snags really hurting the company's outlook. That's

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<v Speaker 1>the big picture. So Intel plunging after its revenue forecast

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<v Speaker 1>missed analyst estimates, hurt by sputtering demand for PC processors

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<v Speaker 1>and supply chain problems with its lucrative data center components.

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<v Speaker 1>Intel projecting the PC market slump will persist through at

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<v Speaker 1>least the first half of 2027 and decline 10% next year,

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<v Speaker 1>following a 12% slide in 2026, so this year. So

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<v Speaker 1>we did say Intel shares are down. The company was optimistic.

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<v Speaker 1>It is being optimistic about demand for its products and

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<v Speaker 1>increasing its spend on new equipment to boost production, but

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<v Speaker 1>having trouble meeting all that demand.

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<v Speaker 3>Shares going into this afternoon's print were up 150%, but

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<v Speaker 3>still shares down right now by 16% in the after hours. Okay.

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<v Speaker 1>Let's go to Amazon.

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<v Speaker 3>Intel, let's go to Amazon. Shares down about 7%. In

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<v Speaker 3>the after hours, the company reported greater capital spending than anticipated.

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<v Speaker 3>At the same time, e-commerce revenue slowed, and Amazon's outlook

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<v Speaker 3>for holiday sales indicated the online business is not poised

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<v Speaker 3>for a quick rebound. The company did spend more than

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<v Speaker 3>$ 77 billion on property and equipment in the third quarter,

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<v Speaker 3>leading to a free cash flow outflow of $ 42. 4 billion

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<v Speaker 3>and revenue gain 12% to $ 201.

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<v Speaker 1>9 billion.

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<v Speaker 3>Online sales gained just 2%. to $ 68. 5 billion. It's the

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<v Speaker 3>lowest growth rate since early 2023. Well, revenue at its

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<v Speaker 3>cloud unit, AWS, accelerated for the sixth straight quarter. Shares

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<v Speaker 3>of Amazon in the after hours down about 7%.

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<v Speaker 1>Yeah, those are like two of the behemoths, if you will. AMZN. AMZN.

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<v Speaker 1>All right, so let's go over to RDDT. We're talking

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<v Speaker 1>about Reddit. We're seeing this stock moving significantly lower. What

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<v Speaker 1>do we got here?

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<v Speaker 3>Yeah, shares of Reddit in the after hours down 17%.

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<v Speaker 3>The company... did report that fourth quarter revenue for its

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<v Speaker 3>forecast missed the average analyst's estimate. The estimate was for

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<v Speaker 3>$ 1. 05 billion, but it sees revenue at $ 1 to $ 1. 03 billion. God,

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<v Speaker 3>this is just a brutal stock reaction for Reddit.

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<v Speaker 1>Riley Griffin writing the right through. So shares falling after

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<v Speaker 1>the company announced plans to limit access to its online

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<v Speaker 1>user forums to user's with accounts to deepen engagement and

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<v Speaker 1>improve the advertising business. Oh, that's interesting.

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<v Speaker 3>So you have to be logged in Reddit to become

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<v Speaker 3>a primarily logged in experience.

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<v Speaker 2>Wow.

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<v Speaker 3>So the advertising will get better, but maybe fewer people

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<v Speaker 3>will use it.

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<v Speaker 1>Exactly. Okay. And I guess they can track it a

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<v Speaker 1>little bit better. I don't know. The company will start

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<v Speaker 1>testing different approaches in markets outside of the US throughout

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<v Speaker 1>the fourth quarter. It has not yet decided which parts

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<v Speaker 1>of its site will remain available to logged out visitors.

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<v Speaker 1>Reddit executives believe the strategy will eventually lead to more

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<v Speaker 1>growth despite the potential for it to limit the platform's

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<v Speaker 1>reach in the short term by encouraging people to visit

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<v Speaker 1>the platform directly and providing valuable insights to advertisers. I

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<v Speaker 1>often fall into Reddit. I'm just doing a search about something.

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<v Speaker 3>I'm sure you're not signed in though, right?

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<v Speaker 2>Nope, I'm not signed in.

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<v Speaker 1>And so that's what they don't want. They want you

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<v Speaker 1>signed in so they can actually track kind of the

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<v Speaker 1>data on particular users, but that's valuable to advertisers. We

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<v Speaker 1>know that the more information you can get, on someone,

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<v Speaker 1>the more valuable it is to an advertiser.

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<v Speaker 3>Yeah, I mean, this seems like a conversation we could

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<v Speaker 3>have had 15 years ago.

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<v Speaker 1>No, it's not new. That's for sure. But look at

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<v Speaker 1>whether it's meta, whether it's alphabet. That's a valuable business.

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<v Speaker 3>But look to your point, Riley, writing that to date,

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<v Speaker 3>many users have stumbled upon Reddit through Google, making the

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<v Speaker 3>company vulnerable to algorithmic changes and now AI-generated responses. Investors

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<v Speaker 3>have also anxiously awaited details to emerge out of the

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<v Speaker 3>platform's content licensing talks with Google and other AI model providers.

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<v Speaker 3>As Reddit seeks to monetize its unique data, I wonder

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<v Speaker 3>if fewer people are logging in and going to Reddit

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<v Speaker 3>because some of the answers that people are looking for

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<v Speaker 3>can be found on the LLMs that are actually licensing.

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<v Speaker 3>content from reddit.

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<v Speaker 1>From their information remember we thought when they went public

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<v Speaker 1>like all that data was going to be super valuable

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<v Speaker 1>it is still valuable well i'm just going to tell

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<v Speaker 1>you this.

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<v Speaker 3>43 percent this year that's where i was.

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<v Speaker 1>Going to go 43 percent no year to date 15

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<v Speaker 1>of the float is short so those who are looking

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<v Speaker 1>at the share price those have been short the company

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<v Speaker 1>you know it's turning out to be a pretty smart.

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