Japan’s inflation hits new highs, Meta boosts executive bonuses despite layoffs, and Amazon edges past Walmart in quarterly revenue. Alibaba posts a massive profit surge, while Walmart’s shares tumble over weak profit forecasts. All this and more on the February 21 edition of World Street.
On higher grounds
Japan's inflation surged 4 percent year-on-year in January, reaching its highest level since early 2023 and reinforcing expectations for rate hikes by the central bank. Core inflation, which excludes fresh food prices, rose to 3.2 percent from 3 percent in December, surpassing economists’ forecasts. The core measure, excluding both fresh food and energy, inched up to 2.5 percent, keeping inflation above the Bank of Japan’s 2 percent target for 34 consecutive months.
Hefty pockets
Meta executives are set for bigger paydays, with the company approving an increase in their annual target bonuses from 75 percent to 200 percent of base salary. The change, which excludes CEO Mark Zuckerberg, was approved after Meta’s board determined executive compensation lagged behind industry peers. The announcement comes just a week after Meta began laying off 5 percent of its workforce, targeting low performers.
Neck-to-neck
Amazon outpaced Walmart in fourth-quarter revenue, posting $187.8 billion versus Walmart’s $180.5 billion. While Walmart still leads in annual sales, Amazon is catching up fast—FactSet projects Walmart’s revenue for the upcoming fiscal year at $708.7 billion, with Amazon close behind at $700.8 billion.
Good times
Alibaba reported a sharp profit surge in the December quarter, driven by strong growth in its cloud and e-commerce segments. Net income soared to 48.95 billion yuan ($6.72 billion), beating estimates of 40.6 billion yuan and more than tripling last year’s figure. Revenue hit 280.15 billion yuan, slightly exceeding analyst expectations. Alibaba’s stock has jumped about 50 percent on both New York and Hong Kong exchanges this year.
Tough times ahead
Walmart shares fell over 6 percent on Thursday after the retailer warned of slower profit growth for the fiscal year ahead, despite steady sales momentum. Holiday-quarter revenue rose about 4 percent, with U.S. e-commerce sales surging 20 percent, driven by store pickup, home deliveries, and higher spending from upper-income shoppers. However, Walmart’s forecast of 3 percent to 4 percent net sales growth and 3.5 percent to 5.5 percent adjusted operating income growth fell short of expectations, dampened by the Vizio acquisition and the impact of a leap year in 2024.
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