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📈 Tesla's 20% Speed Bump
OpenAI would buy Google Chrome, Boeing to sell Jeppesen unit for $10.6B, Meta could take $7B tariff hit, Chobani building NY plant for $1.1B, Tesla reports drop in auto revenue
Evelio Silvera
April 23, 2025
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Below is today’s edition of the Bull Street Daily Briefing…
Good morning.
⚡ The Fast Five → OpenAI would buy Google Chrome, Boeing to sell Jeppesen unit for $10.6B, Meta could take $7B tariff hit, Chobani building NY plant for $1.1B, Tesla reports drop in auto revenue
🔎 Market Trends → Trump steps down from threat to fire Fed's Powell, market jumps; US Futures Steady After Sharp Selloff
And now…
⏱️ Your 5-minute briefing for Wednesday, April 23, 2025:
MARKET BRIEF
Before the Open
As of market close 04/22/2025.
Pre-Market
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Fear & Greed
Markets in Review
Markets Rally as US-China Thaw Sparks Investor Optimism
The Nasdaq and Dow each rose 2.7%, snapping a four-day slide to close at 16,300.4 and 39,187, respectively. The S&P 500 climbed 2.5% to 5,287.8, with all 11 sectors ending higher, led by financials and consumer discretionary.
The Big Picture:
Markets caught a tailwind as hopes grew that US-China trade tensions may be easing. Treasury Secretary Scott Bessent signaled progress toward a de-escalation, suggesting neither side views the status quo as sustainable.
President Trump’s recent 90-day tariff pause for non-retaliating countries and backchannel talks with global leaders, including Israel's Netanyahu, are being viewed by investors as signs of a more nuanced approach to trade—and less immediate downside risk.
Oil gained 1.8% to $64.20, boosted by de-escalation hopes and ongoing global supply dynamics. Meanwhile, gold retreated 1% to $3,391, pulling back from all-time highs, as risk appetite returned to equities.
Market Movers:
3M (MMM) popped 8.1%, leading the Dow, after maintaining its full-year outlook despite tariff exposure and beating Q1 estimates.
Equifax (EFX) jumped nearly 14%, the top S&P 500 performer, following a strong Q1 earnings beat.
Northrop Grumman (NOC) tumbled 12.7% after cutting its outlook, citing B-21 program losses.
RTX (RTX) fell 9.8% as it projected an $850M tariff-related hit, sparking investor concern on the earnings call.
What They’re Saying:
“The global economic system is being reset… but growth remains well above recession levels,” said IMF’s Pierre-Olivier Gourinchas, reinforcing resilience despite uncertainty.
WHAT WE’RE WATCHING
Events
Today: S&P Global - Flash Manufacturing Purchasing Managers' Index (PMI) - 9:45am
Why You Should Care: It's a leading indicator of economic health - businesses react quickly to market conditions, and their purchasing managers hold perhaps the most current and relevant insight into the company's view of the economy.
Today: S&P Global - Flash Services Purchasing Managers' Index (PMI) - 9:45am
Why You Should Care: It's a leading indicator of economic health - businesses react quickly to market conditions, and their purchasing managers hold perhaps the most current and relevant insight into the company's view of the economy.
Earnings Reports
Today: AT&T, IBM, Chipotle, Philip Morris, Boeing, Texas Instruments, Thermo Fisher, ServiceNow, Discover
Tomorrow: Alphabet (Google), PepsiCo, Procter & Gamble, T-Mobile, Comcast, Intel, Keurig Dr Pepper, Merck, Bristol-Myers Squibb
MARKET BRIEF
Leading News
Tesla's Speed Bump: Why Revenue Dip Could Signal a Buying Opportunity
Photo Credit: David Von Diemar
Why it matters:
Tesla's 20% drop in auto revenue and earnings miss reveal short-term challenges, but savvy investors might see this as a chance to acquire shares in an innovation leader at a discount while the market overreacts to temporary headwinds.
Zoom Out:
The electric vehicle pioneer reported quarterly results that disappointed Wall Street's expectations, with adjusted earnings of 27 cents per share versus the 39 cents analysts predicted. Total revenue declined 9% to $19.34 billion, with automotive revenue specifically tumbling 20% to $14 billion.
These numbers reflect what prudent investors recognize as transitional growing pains rather than fundamental weakness. Tesla cited production line upgrades for the refreshed Model Y and lower average selling prices as primary factors in the revenue decline.
Key Insights:
Manufacturing transition creates temporary pressure: Tesla is updating production lines at its four vehicle factories to manufacture a refreshed version of its Model Y SUV, a necessary investment that temporarily reduces output but positions the company for improved future efficiency.
Energy storage business shines: Energy generation and storage revenue jumped an impressive 67% to $2.73 billion, highlighting Tesla's diversification beyond vehicles into the rapidly growing grid stabilization market driven by AI infrastructure demands.
Regulatory credits provide cushion: Revenue from environmental regulatory credits increased to $595 million, demonstrating Tesla's continued ability to monetize its zero-emission status while competitors struggle to meet requirements.
Market Pulse:
"Increasing tariffs may cause market volatility and near-term impacts to supply and demand," Tesla cautioned in its shareholder deck, acknowledging the potential impact of shifting trade policies.
Bull’s Take:
Smart money recognizes that innovation leaders often experience volatility during product transitions. With the company on track for its Austin robotaxi launch in June and humanoid robot production beginning this year, patient investors may find today's 41% year-to-date price decline represents a potential entry point for a company still positioned at the forefront of multiple technological revolutions.
Headlines
OpenAI would buy Google’s Chrome browser, ChatGPT chief says (link)
Boeing to sell Jeppesen unit to Thoma Bravo for $10.6 billion (link)
Meta could take a $7 billion hit this year because of Trump’s tough China tariffs (link)
Chobani to start building new Upstate NY yogurt plant this year at $1.2B (link)
Barrick Selling Its Stake in Alaska Gold Project for Up to $1.1 Billion (link)
AMD’s AI story was already ‘tenuous,’ and now the stock has new challenges (link)
CRYPTO
Fear & Greed
Headlines
DAILY SHARE
On the Socials
*Hat-tip to wallstmemes
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