CE 100 Index Advances 1.5% as Netflix Surges on Subscriber Gains

The earnings roll in, and the stocks gyrate — a roller coaster that happens every three months.

The CE 100 Stock Index gained 1.5%, as all but one pillar finished in the green for the week. The lone holdout was the Shop Index, which lost 3.8%.

To that end, Netflix surged more than 18%, leading the Have Fun segment 3.8% higher.

As reported here, Netflix has seen a surge in its subscriber roster, noting in its latest quarterly report that paid membership grew by nearly 13% year on year — with more than 13 million new individuals joining the ranks. Netflix also announced an exclusive deal to stream WWE Raw in the United States, Canada, the United Kingdom and Latin America. Revenues were up 12.5% to $8.8 billion, and average revenue per member was up 1% year over year. 

Xerox also gathered 18%, helping to push the Work segment higher by 3.5%. The company said this past week that fourth-quarter revenues were down 10.6% in constant currency. Management noted, however, that for the full year, the company posted adjusted operating profit that improved by more than $100 million. CEO Steve Bandrowczak said on the call that “improvements stem from structural cost reduction efforts, pricing discipline and ongoing operational efficiencies.” The company announced earlier this year that it would lay off 15% of its workforce as part of its restructuring efforts. 

Vroom Swoons Amid eCommerce Exit

Vroom’s dramatic 44% decline in its stock price was the main driver that led the Shop segment lower. The plummet came as the company said it was winding down its eCommerce operations and discontinuing its used vehicle dealership business. The efforts come as Vroom has sought to preserve liquidity, has moved to raise additional capital and extend its vehicle floorplan facility past its current expiration date of March 31, Vroom CEO Thomas Shortt said this week.   

But “despite significant efforts to do so, we ultimately were unable to raise the necessary capital in the current market,” Shortt said. Vroom will focus on its other ventures, including automotive finance company United Auto Credit Corp. (UACC) and CarStory, a provider of artificial intelligence (AI)-powered analytics and digital services for automotive retail.  

Vroom plans to lay off 800 employees — 90% of those not engaged with UACC or CarStory — according to a filing with the Securities and Exchange Commission (SEC). 

Tesla slipped more than 13% through the week, as the Move segment eked out a 0.5% gain. Tesla warned that its growth this year “may be notably lower” than in years past. The company’s earnings show that the latest quarter’s earnings were 38% higher than last year — though the company’s targeted growth rate has been around 50%. Total revenues were up 3% year on year to $25.2 billion. Operating margins were 8.2%, lower than last year (where that metric had been in the double-digit percentage points) as vehicle average selling prices declined.

Losses in PayPal for the week also helped blunt the gains seen from the likes of Netflix. The Pay and be Paid segment was up 1.6%.

PYMNTS reported this past week that PayPal is introducing what it terms a “reimagined checkout experience” that will significantly reduce checkout times. In addition, it’s using artificial intelligence (AI) to craft personalized recommendations to consumers and has also announced cash-back offerings that CEO Alex Chriss said will “revolutionize commerce.” The half-dozen products and services are in the pilot phases, with larger rollouts slated for later in the year.

Among the new offerings: The company’s “Fastlane” service, a retooling of the checkout experience, will enable one-click guest checkouts as they save their data with PayPal. The company is also using AI to organize and use data to provide personalized recommendations and a cash-back reward offer on customers’ receipts.