Afternoon Roundup: Today's Top Stories
At The Motley Fool, we know our readers like to be informed, so we've scouted out today's most relevant news items and brought them to you all on one page. We hope you find this midday edition informative and useful.
's (NAS: NFLX) stock fell 36% on Tuesday after it announced this quarter's numbers. The company, whose stock price had already dipped 61%, said it had lost about 800,000 subscribers after raising its prices and futilely attempting to spin off its DVD-by-mail business. The company's market value has fallen by nearly $12 billion in roughly three months. Netflix did report a 63% increase in earnings up to $62.5 million and a 49% increase in revenue up to $821.8 million.
In addition to its quarterly report, Netflix said it expected to lose money during the next few quarters as it expands to Ireland and the U.K. CEO Reed Hastings said the investments would pay for themselves in the long run as the two regions improve their broadband capabilities. But analysts believe Netflix could be in a tight spot as competitors like Amazon.com (NAS: AMZN) begin to enter the market. Hastings said it won't offer any promotions to bring back its lost clientele. Read more at The Wall Street Journal.
After signing the latest labor contract, which will raise labor costs by less than 1%, Ford (NYS: F) is looking to restore its dividend payout as soon as January. This would be the company's first dividend since September 2006 as it waited to get an investment-grade credit rating. But despite a favorable labor contract, the company has not reached the desired level. Standard & Poor's raised the company's credit two levels to BB+ while Fitch raised it by one to BB+, which is still a notch below investment-grade. Nonetheless, the company hinted that it may overlook its personal requirement and give out an $0.08 dividend.
But the company has a positive outlook. Since the crisis in 2008, Ford has been able to stay afloat without sacrificing itself to bankruptcy like its partners General Motors (NYS: GM) and Chrysler, now owned by Fiat. With a labor deal that doesn't offer raises to senior workers but does promise 12,000 new jobs, President of the Americas Mark Fields said the costs would be offset by higher manufacturing. Read more atBloomberg.
(NYS: DB) , despite an increasingly heated sovereign debt crisis, reported higher-than-expected profits for the quarter of $1.1 billion. Despite the unexpected good performance, the bank warned of job cuts in its investing banking, showing that it's not entirely immune to the crisis. The cuts would come on top of an announced 10% reduction already on its way.
Around the world, bank profits have been plummeting as consumers demand less uncertainty and risk and the fear a second financial crisis brews. Deutsche Bank, which reported a loss of $257 million on Greek bonds, is among the financial institutions that will have to raise more capital to offset losses. Read more at The New York Times.
Insiders say that after releasing its iPhone4S less than a month ago, Apple's (NAS: AAPL) next product could be Apple TV. The company turned to software engineer Jeff Robbin, who helped develop the iPod and iTunes, to create an-all-integrated television set. Steve Jobs before his death had told biographer Walter Isaacson he had finally figured out how to make a TV with a simple interface that could include every product available. Some said the television aims to make it easier for consumers to find shows and movies from cable and services like Netflix. But the company still has to jump some hurdles as it attempts to secure contracts with moviemakers and persuade them to change the way they deliver their product. The product could go on sale by the end of 2013, Bloomberg reported. If Apple decides to continue with this project, it would compete even more closely with companies like Samsung and Sony (NYS: SNE) , with which it already competes in the smartphone market. Read more at Bloomberg.
So there you have it -- the top financial stories for this afternoon. If you're interested in getting all the news and commentary on these stocks, sign up for My Watchlist -- it's free!
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At the time this article was published Michelle Zayed doesn't own any stocks mentioned. The Motley Fool owns shares of Ford Motor. Motley Fool newsletter services have recommended buying shares of Netflix, General Motors, Amazon.com, and Ford Motor. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.
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