All articles tagged with #profit margin
Microsoft reportedly pushed Xbox studios to achieve a 30% profit margin, leading to significant layoffs, canceled projects, price increases, and a shift towards more profitable, less risky games, while also questioning the future of Xbox hardware and exclusives.
Microsoft CFO Amy Hood has reportedly set an aggressive target for Xbox to achieve a 30% profit margin, leading to significant strategic shifts such as price hikes, studio closures, and a focus on profitability over fan feedback, which may harm the Xbox brand and its community.
Super Micro Computer's stock dropped over 20% after missing quarterly earnings and revenue expectations, citing limited working capital and revenue recognition timing issues. Despite strong revenue guidance for 2026, profitability is under pressure due to price competition and low gross margins, with analysts warning of continued margin erosion and other risks including customer concentration and past accounting issues.
Amazon's profit margin reached its highest level since early 2021, with an operating margin of 7.8% in the third quarter, thanks to CEO Andy Jassy's cost-cutting efforts. Jassy has been focused on trimming costs, eliminating jobs, and reshaping Amazon's fulfillment network for increased efficiency. The company's operating margin was historically in the low single digits, but Jassy's optimization initiatives have turned Amazon into a profit machine. The company's revenue also beat estimates, climbing 13% to $143.1 billion, with advertising services playing a key role in the earnings bump. Jassy plans to continue cutting costs and being cautious with hiring.
Volkswagen shares dropped over 3% to their lowest level since April 2020 after the German carmaker reduced its profit margin outlook for the year due to negative effects from raw materials hedges. The company now expects a return on sales of 7.0-7.3%, down from the previous forecast of 7.5-8.5%. Despite the downgrade, Volkswagen maintained its outlook for deliveries and sales, which some analysts see as a sign of confidence. The company reported a 12% increase in third-quarter sales and a 14% rise in operating profit.
PayPal's stock is down by 10.7% as the company's faster growth in the less profitable Braintree checkout product is weighing on its margin outlook, despite beating expectations with its Q1 results and raising some pieces of its outlook.
Chobani CEO, Hamdi Ulukaya, has stated that he won't be captive to profit-margin demands and has enlisted the help of other companies to aid refugees. Ulukaya has also called on other CEOs to join him in his efforts to help refugees and has created a foundation to support the cause.
Procter & Gamble's profit grew in Q1 2023 after raising prices 10% across its brands for a second consecutive quarter, with revenue rising 4% YoY despite sales volumes falling by 3%. The company's profit margin expanded as price increases more than offset the rise in raw material costs. Procter & Gamble also raised its revenue forecast for the fiscal year and plans to buy back up to $8bn in its own stock. However, the company still faces challenges ahead, including inflation and higher operating costs.
Ford's electric vehicle business has lost $3 billion before taxes in the past two years and is expected to lose a similar amount this year due to heavy investment in the new technology. The company's new business structure separates electric vehicles, profitable internal combustion, and commercial vehicle operations into three operating units. The electric vehicle unit, called "Ford Model e," is expected to be profitable before taxes by late 2026 with an 8% pretax profit margin. The company is investing heavily in the development of second- and third-generation electric vehicles and expects to be building electric vehicles at a rate of 600,000 per year by the end of this year, reaching a rate of 2 million per year by the end of 2026.