Warner Bros. Discovery Q1 2025 Earnings Drop & Arm Holdings AI Chip Outlook Sparks Market Concern

Market Update for May 9, 2024

Shares of Warner Bros. Discovery (WBD) declined after reporting first-quarter earnings below expectations, even as the company announced a new streaming bundle partnership with Disney (DIS) combining Disney+, Hulu, and Max. The streaming bundle aims to offer consumers a cable-like package in the evolving digital entertainment landscape.

1. Warner Bros. Discovery Earnings Miss Estimates, Shares Fall Over 4%

Warner Bros. Discovery reported a 7% year-over-year revenue decline to $9.96 billion and a net loss of $966 million, an improvement from the prior year’s loss of $1.07 billion. Diluted loss per share stood at 40 cents versus 44 cents last year. Despite the earnings miss, the streaming bundle announcement with Disney marks a strategic move to boost subscriber engagement.

2. Arm Holdings Stock Drops 8% Amid Weak Fiscal 2025 Guidance

Arm Holdings (ARM) saw shares tumble following a cautious revenue forecast for fiscal 2025, despite a 47% revenue surge in Q4. CEO Rene Haas highlighted strong AI chip demand tailwinds, but full-year revenue guidance between $3.8 billion and $4.1 billion fell short of analyst estimates, sparking investor concerns over potential AI spending slowdowns.

3. Airbnb Shares Slide 9% After Disappointing Quarterly Outlook

Airbnb (ABNB) posted first-quarter earnings and revenue that beat expectations, but weaker-than-anticipated guidance for the current quarter led to a 9% premarket drop. Factors such as the timing of Easter, an extra leap-year day in the previous quarter, and currency fluctuations contributed to the cautious outlook despite optimism about increased bookings during the Paris Olympics.

4. Robinhood Markets Surges 5% on Record Q1 Revenue and Crypto Growth

Robinhood Markets (HOOD) gained momentum after reporting a 232% year-over-year increase in crypto transaction revenue, reaching $126 million, and a 40% rise in total net revenue to $618 million. The company also revealed over one million sign-ups for its new premium "gold" credit card offering 3% cashback, signaling strong consumer interest despite pending SEC scrutiny over its crypto operations.

5. Sony Pictures and Apollo Plan to Restructure Paramount Global in Potential Acquisition

According to reports, a consortium led by Sony Pictures Entertainment and Apollo Global Management aims to acquire and dismantle Paramount Global (PARA) if successful in the bidding war. The proposed breakup involves auctioning CBS, MTV, and Paramount+ streaming service, while integrating Paramount Pictures with Sony’s studio assets. Paramount’s board has approved preliminary deal talks, with shares rising 1% premarket.

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