Retail Giant Gets an 8% Markdown Upon Weak 2025 Outlook

Author

Adam Garcia
February 20, 2025

A retail giant is tumbling on weak 2025 guidance, an e-commerce powerhouse is surging on AI-driven cloud growth, and an EV company is soaring 32% after one of its charging solutions received GSA approval. Here’s what you need to know.

Luxury Real Estate (Sponsored)

The wealthiest companies tend to target the biggest markets. For example, NVIDIA skyrocketed nearly 200% higher last year with the $214B AI market’s tailwind. That’s why investors like SoftBank are so excited about Pacaso. 

Created by the team that grew Zillow to a $16B valuation, Pacaso’s digital marketplace offers easy purchase, ownership, and enjoyment of luxury vacation homes. And their target market is worth a whopping $1.3T. No wonder Pacaso has earned $100M+ in gross profits. 

Now, they’re focused on international expansion – achieving record-breaking sales in Paris, securing 7 homes in Cabo, and recently buying their most valuable European property to date in London.

That’s why Pacaso’s current share price won’t last long. Invest for $2.70/share before 2/27.

This is a paid advertisement for Pacaso’s Regulation A offering. Please read the offering circular at invest.pacaso.com.

Futures 📈

What to Watch

Earnings:

  • Booking Holdings Inc. [BKNG]: Aftermarket

  • Nu Holdings Ltd. [NU]: Aftermarket

  • Copart, Inc. [CPRT]: Aftermarket

  • Newmont Corporation [NEM]: Aftermarket

  • Block, Inc. [SQ]: Aftermarket

  • Cheniere Energy, Inc. [LNG]: Aftermarket

Economic Reports:

  • Initial jobless claims [Feb. 15]: 8:30 a.m.

  • Philadelphia Fed manufacturing survey [Feb]: 8:30 a.m.

  • Chicago Fed President Austan Goolsbee speaks: 9:30 a.m.

  • U.S. leading economic indicators [Jan]: 10:00 a.m.

  • Fed Vice Chair for Supervision Michael Barr speaks at 2:30 p.m.

  • Fed Governor Adriana Kugler speaks at 5:00 p.m.

Retail

Walmart’s Stock Falling Despite Surpassing Q4 Estimates Due to Weak 2025 Outlook

Walmart [NYSE: WMT] reported better-than-expected fourth-quarter earnings, including a 5.3% rise in revenue to $182.6 billion, surpassing Wall Street projections today.

Adjusted earnings per share (EPS) are up 10% year-over-year to $0.66, which is also slightly above analysts’ expectations of $0.65.

Same-store sales in the U.S. climbed 4.6%, fueled by strong foot traffic and the continued growth of high-income shoppers looking for value.

Walmart’s e-commerce business rose 20%, driven by in-store pickup, delivery, and its expanding online marketplace.

Its subscription service, Walmart+, also experienced double-digit growth, while its advertising and membership revenue jumped 33%.

Grocery sales, which account for 60% of Walmart’s total revenue, recorded mid-single-digit growth, supported by rising online orders and in-store visits.

Meanwhile, the company’s health and wellness division saw mid-teens growth, boosted by pharmacy sales, same-day delivery, and increased demand for GLP-1 weight-loss drugs.

However, sales of discretionary items, such as toys and apparel, posted only modest gains.

Walmart's net sales grew 5.6% to $684.2 billion for the full fiscal year, exceeding both its own forecasts and analysts’ expectations.

However, its cautious 2025 outlook is weighing on investor sentiment. The retailer projects net sales growth of 3% to 4% for fiscal 2026, which is being viewed as conservative.

Despite its strong performance, Walmart’s stock is down 8.8% in premarket trading, with investors focusing more on its subdued future guidance.

E-Commerce

Alibaba Beating Expectations with AI-Powered Cloud Growth

Chinese tech giant Alibaba [NYSE: BABA] reported a significant jump in quarterly profit today, driven by strong performance in its Cloud Intelligence and e-commerce divisions.

The e-commerce firm posted a net income of 48.95 billion yuan ($6.72B) for the quarter ending December 31, surpassing analyst expectations of 40.6 billion yuan ($5.57B) and significantly outpacing the 14.43 billion yuan ($1.98B) reported a year earlier.

Revenue reached 280.15 billion yuan ($38.46B), slightly ahead of estimates of 279.34 billion yuan ($38.35B). Alibaba’s U.S.-listed shares are surging 9.2% during premarket trading.

CEO Eddie Wu is confident that artificial intelligence will continue to drive expansion in the Cloud Intelligence segment, asserting, “Our Cloud revenue growth reignited to double digits at 13%, with AI-related product revenue achieving triple-digit growth for the sixth consecutive quarter.”

Alibaba’s cloud division reported a 13% year-over-year revenue increase, reaching 31.74 billion yuan ($4.35B), while its Taobao and Tmall Group saw a 5% rise in revenue to 136.09 billion yuan ($18.68B).

International e-commerce platforms like AliExpress and Lazada performed even stronger, with a 32% revenue jump to 37.76 billion yuan ($5.18B), fueled by cross-border demand.

The company’s AI initiatives remain in focus, particularly after its latest Qwen 2.5 model claimed an edge over Chinese rival DeepSeek.

Meanwhile, founder Jack Ma made a rare public appearance at a meeting with Chinese President Xi Jinping, signaling renewed government support for private businesses.

Polymetallic Discoveries (Sponsored)

A Canadian mining company has just uncovered a high-grade polymetallic discovery with drill results that rival the best in the world. With a fully funded 2025 exploration program and increasing demand for critical metals, this opportunity is picking up steam.

Backed by mining icons Robert Friedland and Rob McEwen, this project is attracting serious attention. Early investors could be looking at significant upside potential.

Technology

NetEase Sees Earnings Growth as Gaming Division Outperforms

NetEase, Inc. [NASDAQ: NTES] reported higher-than-expected fourth-quarter earnings despite a slight decline in revenue.

The Chinese gaming and internet services provider achieved a quarterly profit of RMB8.8 billion ($1.2B), up from RMB6.6 billion ($906M) in the same period last year.

Earnings per share increased to $0.38, or $1.89 per American Depositary Share (ADS), from $0.28 and $1.40 per ADS, respectively.

On an adjusted basis, the company posted earnings of RMB9.7 billion ($1.3B), compared to RMB7.4 billion ($1.01B) a year earlier.

Adjusted earnings per share are $0.42, or $2.09 per ADS, up from $0.32 and $1.57 per ADS in the fourth quarter of the previous year.

Revenue for the quarter totaled RMB26.7 billion ($3.7 billion), down 1.4% from RMB27.1 billion ($3.72B) last year.

The decline is driven by weaker performances in the Youdao and Cloud Music divisions.

Revenue from Youdao dropped to RMB1.3 billion ($183.6M) from RMB1.5 billion ($205M), while NetEase Cloud Music saw a decline to RMB1.9 billion ($257.6M) from RMB2.0 billion ($274M) a year earlier.

The company’s board has approved a dividend of $0.24405 per share ($1.22025 per ADS) for Q4 2024.

Movers and Shakers

Xos, Inc. [XOS] - Last Close: $3.13

Xos is a commercial electric vehicle (EV) company specializing in fleet electrification and charging solutions.

Its shares are surging 32% during premarket trading after announcing that its Xos Hub, a trailer-mounted EV charging unit, has been added to the General Services Administration (GSA) schedule.

My Take: Xos’ GSA listing is a big win for expanding into government contracts. If federal agencies and commercial fleets adopt the Xos Hub at scale, the company could see strong long-term growth. Keep this stock on your radar.

Herbalife Ltd. [HLF] - Last Close: $5.62

Herbalife Ltd. is a global nutrition and direct-selling company.

Its shares are rising before the opening bell today after reporting Q4 net sales at the high end of its guidance, posting $1.2 billion in revenue, with a 2.7% year-over-year increase on a constant currency basis.

Adjusted EBITDA of $150 million is also above expectations, and new distributor signups are up 22% year-over-year.

My Take: Herbalife’s distributor growth and cost-cutting are stabilizing its business, but its net sales haven’t been growing, which is a cause of concern. Keep a close eye on whether distributor growth translates to better net sales.

Amplitude, Inc. [AMPL] - Last Close: $11.85

Amplitude, Inc., is a leading digital analytics platform.

Its shares are soaring during premarket after the company beat Q4 estimates, growing revenue 9.4% yearly to $78.13 million and surpassing analyst expectations of $76.69 million.

It also projected FY25 revenue between $324.8 million and $330.8 million, slightly higher than consensus estimates.

My Take: Amplitude’s resilient growth and bullish guidance signal improving demand for digital analytics. However, stiff competition from Google Analytics and Adobe Analytics remains a challenge. Keep this stock in your wait and watch bucket.

Precious Metals (Sponsored)

A leading junior miner just announced major progress on their flagship Red Lake District project, and it’s picking up steam. With 1.65 million ounces of high-grade gold, a $68M funding boost, and production targeted for 2025, this could be a breakout moment.

With infrastructure upgrades underway and a recent Pre-Feasibility Study, early investors could have a big opportunity ahead.

Everything Else

That’s all for today. Thank you for reading. If you have any feedback, please reply to this email.

Best Regards,

— Adam Garcia
Elite Trade Club

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