Gap has raised its full-year forecast after reporting positive comparable sales across all its brands. Meanwhile, Dell's lowered profit outlook due to increased costs for AI-capable servers caused its shares to drop over 17 percent. Saudi Arabia's government has initiated proceedings to offer a new stake in Aramco, potentially raising up to $13.1 billion. Despite warnings, Elon Musk failed to disclose his increased Twitter ownership in 2022. All this and more on this edition of World Street.
Gap raises full-year outlook
Gap reported positive comparable sales across all its brands, prompting the company to boost its full-year forecast. The parent company of Gap, Banana Republic, Athleta, and Old Navy surpassed earnings expectations and revenue targets, causing its stock to surge over 20 percent in after-hours trading.
For the fiscal first quarter, Gap posted a net income of $158 million, a significant improvement from the $18 million loss reported in the same quarter last year.
Dell warns of lower profits
Dell's new forecast for its current-quarter profit fell short of market expectations on Thursday. The company indicated that increased costs for building servers capable of handling heavy AI workloads would impact its annual margin.
As a result, Dell's shares dropped over 17 percent in after-hours trading. Additionally, Dell predicts its adjusted gross margin rate will decrease by approximately 150 basis points in fiscal 2025.
Twitter takeover tactics
Elon Musk, despite multiple warnings about U.S. securities disclosure rules, did not disclose his increasing ownership of Twitter in 2022. A lawsuit claims that Musk and his advisor, Jared Birchall, knew and discussed the requirement to report when their stake exceeded five percent.
This information comes from testimonies during an SEC investigation, according to a Morgan Stanley executive involved in Musk's secret acquisition of Twitter shares.
Fall from grace
Donald Trump has made history as the first former US president to be convicted of a crime. Following a New York jury's unanimous decision, Trump was found guilty on all charges in his hush money case. The charges revolved around 34 counts of falsifying business records to conceal a payment aimed at silencing porn star Stormy Daniels.
While theoretically facing a potential sentence of four years for each count, it's more probable he'll receive probation. Trump, aged 77 and of the Republican party, was released without bail but now carries the status of a felon. This marks an unprecedented and notable development in a nation where presidents are often regarded as the most influential figures globally.
Another hurdle out the way
US Steel Corp and Japan's Nippon Steel have cleared all regulatory hurdles outside of the US for their planned $14.9 billion merger, as announced by the companies earlier this week. Last December, Nippon successfully sealed the deal to acquire US Steel, surpassing competitors such as Cleveland-Cliffs, ArcelorMittal, and Nucor.
However, the merger still awaits approval within the US, where it is under regulatory review and encountering mounting political resistance. Notably, President Joe Biden has expressed opposition, advocating for US Steel to retain domestic ownership.
Minting money
Saudi Arabia's government has initiated proceedings on Thursday to offer a new stake in the state oil giant Aramco, potentially raising up to $13.1 billion. This move marks a significant step towards financing Crown Prince Mohammed bin Salman's ambitious plan to diversify the economy.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
