Intel Plunges, Amazon and Reddit Fall

0:02 Bloomberg Audio Studios, podcasts, radio, news.

0:08 The Stock Movers Report, your roundup of companies making moves in the stock market, harnessing the power of Bloomberg data.

0:16 I'm Tim Stenevek, along with Carol Masser. Let's take a look at some stocks on the move today. Should we start with Intel? And we got some serious stocks on the move. Let's start with Intel, yeah.

0:24 Yeah, ticker is INTC. Folks, that stock is down more than 15%. As we speak here in the aftermarket, we are seeing the stock plunge. This happening after a PC slump in supply snags really hurting the company's outlook. That's the big picture. So Intel plunging after its revenue forecast missed analyst estimates, hurt by sputtering demand for PC processors and supply chain problems with its lucrative data center components.

0:51 Intel projecting the PC market slump will persist through at least the first half of 2027 and decline 10% next year, following a 12% slide in 2026, so this year. So we did say Intel shares are down. The company was optimistic. It is being optimistic about demand for its products and increasing its spend on new equipment to boost production, but having trouble meeting all that demand.

1:14 Shares going into this afternoon's print were up 150%, but still shares down right now by 16% in the after hours. Okay.

1:23 Let's go to Amazon.

1:25 Intel, let's go to Amazon. Shares down about 7%. In the after hours, the company reported greater capital spending than anticipated. At the same time, e-commerce revenue slowed, and Amazon's outlook for holiday sales indicated the online business is not poised for a quick rebound. The company did spend more than $ 77 billion on property and equipment in the third quarter, leading to a free cash flow outflow of $ 42. 4 billion and revenue gain 12% to $ 201.

1:49 9 billion.

1:49 Online sales gained just 2%. to $ 68. 5 billion. It's the lowest growth rate since early 2023. Well, revenue at its cloud unit, AWS, accelerated for the sixth straight quarter. Shares of Amazon in the after hours down about 7%.

2:06 Yeah, those are like two of the behemoths, if you will. AMZN. AMZN. All right, so let's go over to RDDT. We're talking about Reddit. We're seeing this stock moving significantly lower. What do we got here?

2:20 Yeah, shares of Reddit in the after hours down 17%. The company... did report that fourth quarter revenue for its forecast missed the average analyst's estimate. The estimate was for $ 1. 05 billion, but it sees revenue at $ 1 to $ 1. 03 billion. God, this is just a brutal stock reaction for Reddit.

2:43 Riley Griffin writing the right through. So shares falling after the company announced plans to limit access to its online user forums to user's with accounts to deepen engagement and improve the advertising business. Oh, that's interesting.

2:55 So you have to be logged in Reddit to become a primarily logged in experience.

2:59 Wow.

3:00 So the advertising will get better, but maybe fewer people will use it.

3:03 Exactly. Okay. And I guess they can track it a little bit better. I don't know. The company will start testing different approaches in markets outside of the US throughout the fourth quarter. It has not yet decided which parts of its site will remain available to logged out visitors. Reddit executives believe the strategy will eventually lead to more growth despite the potential for it to limit the platform's reach in the short term by encouraging people to visit the platform directly and providing valuable insights to advertisers. I often fall into Reddit. I'm just doing a search about something.

3:33 I'm sure you're not signed in though, right?

3:34 Nope, I'm not signed in.

3:35 And so that's what they don't want. They want you signed in so they can actually track kind of the data on particular users, but that's valuable to advertisers. We know that the more information you can get, on someone, the more valuable it is to an advertiser.

3:48 Yeah, I mean, this seems like a conversation we could have had 15 years ago.

3:51 No, it's not new. That's for sure. But look at whether it's meta, whether it's alphabet. That's a valuable business.

3:58 But look to your point, Riley, writing that to date, many users have stumbled upon Reddit through Google, making the company vulnerable to algorithmic changes and now AI-generated responses. Investors have also anxiously awaited details to emerge out of the platform's content licensing talks with Google and other AI model providers.

4:13 As Reddit seeks to monetize its unique data, I wonder if fewer people are logging in and going to Reddit because some of the answers that people are looking for can be found on the LLMs that are actually licensing. content from reddit.

4:27 From their information remember we thought when they went public like all that data was going to be super valuable it is still valuable well i'm just going to tell you this.

4:33 43 percent this year that's where i was.

4:35 Going to go 43 percent no year to date 15 of the float is short so those who are looking at the share price those have been short the company you know it's turning out to be a pretty smart.

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