It's been an interesting week in the business world, with the leading video service provider blowing expectations out of the water, and the No. 1 consumer tech company agreeing to take on debt to return more money to its shareholders, among other events. Here's a rundown of this week's smartest moves and biggest blunders.
Netflix (NFLX) -- Winner
Shares of Netflix had already tripled since bottoming out last summer heading into Monday's report, and skeptics felt that the stock was priced for perfection.
Well, what happens when things are better than perfect?
The leading video service saw its stock pop after posting blowout quarterly results. Netflix tacked on more than 3 million net streaming customers during the first three months of the year, and now that Netflix is serving 4 billion hours of content a quarter it's hard to fathom any potential competitor making a dent in a platform with 36.3 million global subscribers.
Apple (AAPL) -- Loser
Apple gave investors everything they wanted. It posted better than expected revenue and earnings. It hiked its dividend. It announced that new products would be coming (though pointing to the fall and then to 2014 may test the patience of scorched investors).
However, Apple then provided guidance for the current quarter that points to a sharp sequential decline in revenue and another quarter of year-over-year dip in profitability.
Then we learned how Apple plans to pay for a 15 percent dividend hike and a beefed up share buyback plan. Despite having the most cash-rich balance sheet in the planet with roughly $145 billion in greenery, Apple says that it expects to take on debt to return more money to its shareholders.
Yes, a great big chunk of Apple's cash is locked up overseas so the tech giant can avoid paying repatriation taxes to bring that money home. However, isn't it time to take that hit and crack open the piggy bank? The last thing Apple needs is to be leveraged right now.
Microsoft (MSFT) -- Winner
Xbox fans better start saving their money. Microsoft has scheduled a May 21 media event.
"A new generation revealed," teases the invitations that went out on Wednesday, and there's little doubt that Microsoft has a new video game console to show off.
This is pretty big news. The Wii U has been a disappointment since last November's debut. And Sony (SNE) recently unveiled specs for the PlayStation 4 that will hit the market later this year. The big question mark has been whether Microsoft -- whose Xbox has been the top selling system in this country for 27 consecutive months -- would hit the market in time for this year's holiday season or wait until 2014.
Well, it wouldn't be hosting this event for a machine that isn't going to hit the market until next year. It seems as if Microsoft and Sony will battle it out this holiday season, and that's just what this industry needs. The video game sector has posted declining hardware and software sales for three years. If it's not too late, Microsoft is the best candidate to give the niche a shot.
Zynga (ZNGA) -- Loser
It was a bad week for the easily duped. The market had a brief crash when the Twitter account of the Associate Press was hacked and a post indicated that the White House was under attack and President Obama was hurt.
However, another hoax that wasn't as widely reported was a bogus press release indicating that Zynga would be acquired by Chinese leading search engine Baidu (BIDU) for $10 a share.
Zynga's stock temporarily moved higher on the news, even though the press release originated on a website that allows for free submissions. There may be an argument to be made that Baidu should snap up the social gaming leader, but no one would pay three times what Zynga's stock is currently worth to buy it out.
Time Warner (TWX) and Walmart (WMT) -- Winners
We're still nearly two months away from Time Warner's Superman reboot, but the world's largest retailer is swooping in to help make "Man of Steel" a success.
In an intriguing promotion, thousands of theaters will hold advance screenings of the new movie on June 13 -- a day before the actual release -- and those preview tickets can only be bought through Walmart.
It's a win-win. Time Warner will have Walmart's 3,700 stores promoting the release, and young adults who might normally not be caught dead at the discounter will have little choice but to revisit Walmart.
Customers buying the advance screening tickets through Walmart will also receive codes to preorder special versions of the Blu-ray, DVD, or digital download with exclusive additional content.
Superman wins again.
Motley Fool contributor Rick Munarriz owns shares of Netflix. The Motley Fool recommends Apple, Baidu, and Netflix. The Motley Fool owns shares of Apple, Baidu, Microsoft, and Netflix. Try any of our newsletter services free for 30 days.