Global Trends and Politics
Deal Activity Picking Up
America’s Investment Banks Just Had a Record-Breaking Quarter
American investment banks have just disclosed a record-breaking quarter, with surging trading activity around the U.S. election and a pickup in investment banking deal flow.
Traders at JPMorgan Chase, for instance, have never had a better fourth quarter, with revenue surging 21% to $7 billion. Goldman Sachs’ equities business generated $13.4 billion for the full year – also a record.
For Wall Street, it was a welcome return to the type of environment craved by traders and bankers after a muted period when the Federal Reserve was raising rates as it grappled with inflation. Boosted by a Fed in easing mode and the election of Donald Trump in November, banks including JPMorgan, Goldman, and Morgan Stanley easily topped expectations for the quarter.
The Grand Machinery Keeping Wall Street Moving
But the grand machinery keeping Wall Street moving is just picking up steam. That’s because, deterred by regulatory uncertainty and higher borrowing costs, U.S. corporations have mostly sat on the sidelines in recent years when it came to buying competitors or selling themselves.
That’s about to change, according to Morgan Stanley CEO Ted Pick. Buoyed by confidence in the business environment, including hopes for lower corporate taxes and smoother approvals on mergers, banks are seeing growing backlogs of merger deals, according to Pick and Goldman CEO David Solomon.
‘Pounding the Table’
Morgan Stanley’s deal pipeline is “the strongest it’s been in 5 to 10 years, maybe even longer,” Pick said Thursday. Capital markets activity, including debt and equity issuance, had already begun recovering last year, rising 25% from the depressed levels of 2023, per Dealogic figures. But without normal levels of merger activity, the entire Wall Street ecosystem has been missing a key driver of activity.
IPO Revival?
Another engine of value creation for Wall Street that has been slow in recent years is the IPO market – which is also set to pick up, Solomon told an audience of tech investors and employees Wednesday. “There has been a meaningful shift in CEO confidence,” Solomon said earlier that day. “There is a significant backlog from sponsors and an overall increased appetite for deal-making supported by an improving regulatory backdrop.”
Conclusion
After a lean few years, it should make for a profitable time for Wall Street’s dealmakers and traders.
FAQs
Q: What drove the record-breaking quarter for American investment banks?
A: Surging trading activity around the U.S. election and a pickup in investment banking deal flow.
Q: Which banks performed well in the quarter?
A: JPMorgan Chase and Goldman Sachs, with revenue surging 21% to $7 billion and $13.4 billion for the full year, respectively.
Q: What is the outlook for merger activity?
A: Growing backlogs of merger deals, according to Morgan Stanley CEO Ted Pick and Goldman CEO David Solomon, driven by confidence in the business environment and hopes for lower corporate taxes and smoother approvals on mergers.
Q: What is the outlook for the IPO market?
A: An IPO revival, with a significant backlog from sponsors and an overall increased appetite for deal-making, according to Goldman CEO David Solomon.
Global Trends and Politics
United Airlines 4Q 2024 Earnings
United Airlines’ Strong Earnings, Growth Outlook Boosts Stock
Gary Hershorn | Corbis News | Getty Images
United Airlines forecast first-quarter earnings that surpassed analysts’ estimates as the carrier seeks to grow earnings again in 2025 thanks to strong travel demand.
Q1 Earnings Forecast
The airline said Tuesday that it expects to earn an adjusted 75 cents to $1.25 in the first three months of the year, above the 54 cents analysts had expected, according to LSEG estimates.
Stock Performance
United’s stock is up more than 180% over the past 12 months as of Tuesday’s close, more than any other U.S. carrier.
Q4 Results
Here is what United reported for the fourth quarter compared with what Wall Street expected, based on estimates compiled by LSEG:
- Earnings per share: $3.26 adjusted vs. $3.00 expected
- Revenue: $14.70 billion vs. $14.47 billion expected
Full-Year 2025 Outlook
For full-year 2025, United expects to grow adjusted earnings to $11.50 to $13.50, in line with expectations of about $12.82, according to LSEG.
Industry Trends
United and rival Delta have benefitted from strong demand for pricier seats like in business class, international travel and their massive loyalty programs. Delta’s CEO Ed Bastian earlier this month said he expects 2025 to be the carrier’s “best financial year in our history.”
Q4 Results Details
United reported a $985 million profit for the fourth quarter, up 64% over last year, on $14.70 billion in revenue, which was up about 8% from a year earlier. Adjusting for one-time items, United reported $3.26 a share for the fourth quarter, also ahead of expectations.
Loyalty-Program Revenue
Loyalty-program revenue, as well as international, domestic and basic economy-class revenue all rose from a year earlier and unit revenue, which measures pricing power, turned positive over the same quarter of 2023.
CEO Comments
United CEO Scott Kirby said he was upbeat about President Donald Trump’s new administration and said that airlines need improvements to air traffic control, echoing sentiments from other industry CEOs like Delta’s Bastian.
Conclusion
United Airlines’ strong earnings and growth outlook are a testament to the carrier’s ability to adapt to changing market conditions and capitalize on strong demand for air travel. As the airline industry continues to evolve, it will be interesting to see how United and its competitors respond to emerging trends and challenges.
FAQs
Q: What is United Airlines’ Q1 earnings forecast? A: United expects to earn an adjusted 75 cents to $1.25 in the first three months of the year.
Q: How does United’s stock performance compare to other U.S. carriers? A: United’s stock is up more than 180% over the past 12 months, more than any other U.S. carrier.
Q: What is United’s full-year 2025 earnings outlook? A: United expects to grow adjusted earnings to $11.50 to $13.50 in 2025.
Global Trends and Politics
Your Right to Paid Time Off: What You Need to Know
As an employee, you have numerous rights and privileges that come with your job. One of the most important of these rights is the right to paid time off. Paid time off, also known as PTO, is a benefit that allows employees to take time off from work without using their vacation or sick leave. In this article, we will explore the importance of paid time off, the different types of PTO, and what you need to know to exercise your right to take time off.
The Importance of Paid Time Off
Paid time off is essential for maintaining a healthy work-life balance, reducing stress, and improving overall well-being. Without PTO, employees may feel burnt out, demotivated, and less productive. Paid time off allows employees to recharge, relax, and come back to work feeling refreshed and revitalized. It also gives employees the opportunity to attend to personal matters, such as doctor’s appointments, family obligations, and personal errands, without having to use vacation or sick leave.
There are several types of paid time off, including:
Vacation Time
Vacation time is the most common type of PTO. It is typically accrued and can be used to take a break from work to travel, relax, or pursue personal interests.
Sick Leave
Sick leave is used to care for personal or family medical issues. It is usually accrued and can be used to take time off when an employee is ill or injured.
Bereavement Leave
Bereavement leave is a type of PTO used to grieve the loss of a loved one. It is usually accrued and can be used to take time off to attend to funeral arrangements, visit with family and friends, or simply to grieve.
Paid Family Leave
Paid family leave is a relatively new type of PTO, which allows employees to take time off to care for a new child, a seriously ill family member, or a family member who is experiencing a serious medical emergency. This type of PTO is usually provided by the government or through employer-provided programs.
What You Need to Know to Exercise Your Right to Paid Time Off
To exercise your right to paid time off, you need to understand the following:
Accrual Rates
Accrual rates refer to how much PTO is earned per pay period. It is essential to understand how your PTO accrues and how much you have available to use.
Accrued Balance
Accrued balance refers to the amount of PTO you have available to use. Make sure to check your accrued balance regularly to avoid taking more time off than you have available.
Requesting Time Off
Requesting time off is a straightforward process, but it is essential to follow your company’s policy and procedure. Make sure to provide adequate notice, specify the dates you need off, and indicate if you will be using vacation or sick leave.
Manager Approval
Manager approval is usually required to take time off. Be prepared to discuss your request with your manager and provide a valid reason for taking time off.
Record Keeping
Keep accurate records of your PTO, including the dates taken off, the type of PTO used, and any correspondence with your manager. This will help you track your accrued balance and ensure you are in compliance with company policies.
Conclusion
In conclusion, paid time off is an essential benefit that allows employees to rest, relax, and recharge. It is crucial to understand the different types of PTO, accrual rates, and how to exercise your right to take time off. By following the guidelines outlined in this article, you can make the most of your PTO and maintain a healthy work-life balance.
FAQs
Q: What is the difference between vacation time and sick leave?
A: Vacation time is used for personal reasons, such as travel or relaxation, while sick leave is used for medical reasons, such as illness or injury.
Q: Can I use my PTO to take time off for a family event, such as a wedding or birthday party?
A: It depends on your company’s policy. Some companies may allow PTO for family events, while others may not.
Q: How much notice do I need to give my manager to take time off?
A: The amount of notice required varies by company and policy. Some companies may require 30 days’ notice, while others may require less.
Q: Can I use my PTO to take time off during peak holiday seasons, such as Christmas or New Year’s?
A: It depends on your company’s policy. Some companies may have restrictions on taking time off during peak holiday seasons, while others may allow it.
Q: Can I carry over unused PTO to the next year?
A: It depends on your company’s policy. Some companies may allow carryover, while others may not.
Global Trends and Politics
Netflix (NFLX) Earnings Q4 2024
Netflix Soars 14% After Beating Q4 Earnings Estimates
Strong Q4 Results
Shares of Netflix soared more than 14% on Tuesday after the company posted fourth-quarter results that beat on the top and bottom lines.
Key Highlights
- The company surpassed 300 million paid memberships during the quarter, adding a record 19 million subscribers.
- Revenue in the fourth quarter jumped 16% year-over-year, reaching $10.25 billion, higher than the $10.11 billion Wall Street had predicted.
- Net income for the period was $1.87 billion, or $4.27 per share, up from $938 million, or $2.11 per share, during the same quarter a year earlier.
Earnings Performance
Here’s how Netflix performed for its most recent quarter, ended December 31, compared with Wall Street estimates:
- Earnings per share: $4.27 vs. $4.20, according to LSEG
- Revenue: $10.25 billion vs. $10.11 billion, according to LSEG
- Paid memberships: 301.63 million vs. 290.9 million, according to StreetAccount
Company’s Outlook
For the full year 2025, Netflix raised its revenue expectations to a range of $43.5 billion to $44.5 billion, around $500 million higher than its previous forecast, reflecting improved business fundamentals and the expected carryover benefit of its stronger-than-expected fourth-quarter performance.
Content and Growth
The fourth quarter was the last for which Netflix will report quarterly paid subscriber counts, as previously announced. Instead, it will start reporting a bi-annual "engagement report" alongside its second- and fourth-quarter releases.
The streamer touted the success of its fourth-quarter slate, which included the release of season 2 of the hit series "Squid Game" as well as live sporting events like the record-breaking Jake Paul and Mike Tyson boxing match and National Football League games on Christmas Day.
Improving Product and Expanding to New Markets
The company plans to improve its core business with more series and films, enhance its product experience, and continue to grow its ads business. Netflix is expected to delve further into the live event space and games, as well.
Conclusion
Netflix’s strong Q4 results demonstrate the company’s continued momentum and ability to attract new subscribers. With a strong content slate, improved product, and expansion into new markets, Netflix is poised for continued growth in 2025 and beyond.
FAQs
Q: What were Netflix’s Q4 earnings per share?
A: $4.27
Q: What was Netflix’s revenue for Q4?
A: $10.25 billion
Q: How many paid memberships did Netflix add in Q4?
A: 19 million
Q: What is Netflix’s outlook for 2025?
A: The company expects revenue to be in the range of $43.5 billion to $44.5 billion.
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