Check out the companies making the biggest moves in premarket trading: Peloton Interactive — Shares climbed 15% after the fitness company announced CEO Barry McCarthy will step down while it seeks a permanent CEO. Peloton also set a restructuring plan that will cut 15% of its staff, or about 400 employees. Once a pandemic darling, Peloton has seen its shares slide. The stock is down 47% year to date. Qualcomm — Shares rose more than 5% after the chipmaker on Wednesday posted $2.44 per share in adjusted earnings in its latest quarter, topping analysts’ estimates of $2.32 per share, according to LSEG. The top end of Qualcomm’s revenue forecast for the current quarter was higher than the Street’s expectations, with the company citing demand for smartphones that require the most advanced chips. Wayfair — Shares added 5.5% after the home furniture retailer’s sales topped analyst estimates, and reduced its losses after letting go of 13% of its workforce at the start of the year, the company said Thursday. Still, Wayfair’s sales slid in the first quarter. Carvana — The used car seller spiked 36% after posting first-quarter revenue Wednesday of $3.06 billion, above analysts’ consensus estimate of $2.67 billion. On Thursday, Morgan Stanley upgraded the stock to overweight and said shares could soar 50%. Cigna — The insurer moved 1% higher after first-quarter adjusted earnings of $6.47 per share topped the $6.22 expected from analysts polled by LSEG. Revenues of $57.25 billion also beat the $56.52 billion consensus estimate. Moderna — Shares rose 2% after the drugmaker posted a narrower-than-expected loss of $3.07 in the first quarter, versus the $3.58 loss expected from analysts polled by LSEG. Revenue came in at $167 million, topping the $97.5 million consensus estimate. Cardinal Health — The drug distributor shed 2% after fiscal third quarter revenue of $54.91 billion fell short of analysts’ consensus estimate of $56.05 billion, according to LSEG. But Cardinal topped adjusted earnings expectations. Nio — U.S.-listed shares of the Chinese electric vehicle maker rose 5% after Nio said it delivered 15,620 vehicles in April, more than double the year-earlier period. DoorDash — Shares dropped 7% one day after the food delivery service said it lost 6 cents per share on $2.51 billion in revenue in the first quarter, wider than the LSEG analyst consensus estimate for a loss of 4 cents per share but above the average forecast of $2.45 billion in revenue. Etsy — The online marketplace lost 13.5% after first-quarter adjusted earnings of 48 cents per share missed the 49 cents a share expected from analysts polled by LSEG. Zillow — The stock tumbled 6% after the real-estate marketplace issued weak guidance for the current quarter. Zillow estimated second-quarter revenue of $525 million to $540 million, versus $559.2 million expected from analysts polled by FactSet. eBay — Shares slipped nearly 4% one day after the online commerce platform issued weak guidance for the second quarter, anticipating between $2.49 billion and $2.54 billion in revenue while analysts polled by LSEG had estimated $2.56 billion. Shake Shack – The hamburger chain added 4% after first-quarter adjusted earnings of 13 cents per share topped the 10 cents per share projected by analysts, according to LSEG. Revenue of $291 million was in line with estimates. Freshworks — The software development company plunged 27% after projecting second-quarter revenue of $168 million to $170 million and full-year revenue of $695 million to $705 million. Analysts polled by FactSet expected $172.1 million for the quarter and $708.3 million for the year. Qorvo — The semiconductor company sank nearly 10% after issuing weak guidance in its fiscal first quarter, expecting earnings of 60 cents to 80 cents per share versus the $1.27 expected from analysts polled by FactSet. — CNBC’s Jesse Pound, Lisa Han, Pia Singh and Tanaya Macheel contributed reporting.
OMAHA, Nebraska — Warren Buffett said Saturday his designated successor Greg Abel will have the final say on Berkshire Hathaway’sinvesting decisions when the Oracle of Omaha is no longer at the helm.
“I would leave the capital allocation to Greg and he understands businesses extremely well,” Buffett told an arena full of shareholders at Berkshire’s annual meeting. “If you understand businesses, you’ll understand common stocks.”
Abel, 61, became known as Buffett’s heir apparent in 2021 after Charlie Munger inadvertently made the revelation at the shareholder meeting. Abel has been overseeing a major portion of Berkshire’s sprawling empire, including energy, railroad and retail.
Buffett offered the clearest insight into his succession plan to date after years of speculation about the exact roles of Berkshire’s top executives after the eventual transition. The investing icon, who’s turning 94 in August, said his decision is influenced by how much Berkshire’s assets have grown.
“I used to think differently about how that would be handled, but I think that responsibility should be that of the CEO and whatever that CEO decides may be helpful,” Buffett said. “The sums have grown so large at Berkshire, and we do not want to try and have 200 people around that are managing a billion each. It just doesn’t work.”
Berkshire’s cash pile ballooned to nearly $189 billion at the end of March, while its gigantic equity portfolio has stocks worth a whopping $362 billion based on current market prices.
“I think what you’re handling the sums that we will have, you’ve got to think very strategically about how to do very big things,” Buffett added. “I think the responsibility ought to be entirely with Greg.”
While Buffett has made clear that Abel would be taking over the CEO job, there were still questions about who would control the Berkshire public stock portfolio, where Buffett has garnered a huge following by racking up huge returns through investments in the likes of Coca-Cola and Apple.
Berkshire investing managers, Todd Combs and Ted Weschler, both former hedge fund managers, have helped Buffett manage a small portion of the stock portfolio (about 10%) for about the last decade. There was speculation that they may take over that portion of the Berkshire CEO role when he is no longer able.
But it seems, based on Buffett’s latest comments, that Abel will have final decisions on all capital allocation — including stock picks.
“I think the chief executive should be somebody that can weigh buying businesses, buying stocks, doing all kinds of things that might come up at a time when nobody else is willing to move,” Buffett said.
Abel is known for his strong expertise in the energy industry. Berkshire acquired MidAmerican Energy in 1999 and Abel became CEO of the company in 2008, six years before it was renamed Berkshire Hathaway Energy in 2014.
Correction: Berkshire’s equity portfolio is worth $362 billion. A previous version misstated the figure.
Warren Buffett walks the floor ahead of the Berkshire Hathaway Annual Shareholders Meeting in Omaha, Nebraska on May 3, 2024.
David A. Grogen | CNBC
OMAHA, Neb. — Warren Buffett revealed that he dumped Berkshire Hathaway’s entire Paramount stake at a loss.
“I was 100% responsible for the Paramount decision,” Buffett said at Berkshire’s annual shareholder meeting. “It was 100% my decision, and we’ve sold it all and we lost quite a bit of money.”
Berkshire owned 63.3 million shares of Paramount as of the end of 2023, after cutting the position by about a third in the fourth quarter of last year, according to latest filings.
The Omaha-based conglomerate first bought a nonvoting stake in Paramount’s class B shares in the first quarter of 2022. Since then the media company has had a tough ride, experiencing a dividend cut, earnings miss and a CEO exit. The stock declined 44% in 2022 and another 12% in 2023.
Paramount
Just this week, Sony Pictures and private equity firm Apollo Global Management sent a letter to the Paramount board expressing interest in acquiring the company for about $26 billion. The firm has also been having takeover talks with David Ellison’s Skydance Media.
Paramount has struggled in recent years, suffering from declining revenue as more consumers abandon traditional pay-TV, and as its streaming services continue to lose money. The stock is in the red again this year, down nearly 13%.
Buffett said the unfruitful Paramount bet made him think more deeply about what people prioritize in their leisure time. He previously said the streaming industry has too many players seeking viewer dollars, causing a stiff price war.
OMAHA, Neb. — Warren Buffett said that Berkshire Hathaway is looking into an investment in Canada.
“We do not feel uncomfortable in any shape or form putting our money into Canada,” he told an arena full of investors Saturday. “In fact, we’re actually looking at one thing now.”
The billionaire investor has placed bets in the country in the past. He’s previously taken a roughly $300 million position in Home Capital Group that investors took as a vote of confidence in the troubled Canadian mortgage underwriter.
The “Oracle of Omaha” said during the annual shareholder meeting that he does not expect to make significant bets outside the U.S., saying his recent investments in Japanese trading houses were a compelling exception. But Buffett noted the similarity in operations between the Canada and the U.S.
“There’s a lot of countries we don’t understand at all,” Buffett said. “So, Canada, it’s terrific when you’ve got a major economy, not the size of the U.S., but a major economy that you feel confident about operating there.”
Warren Buffett walks the floor and meets with Berkshire Hathaway shareholders ahead of their annual meeting in Omaha, Nebraska on May 3rd, 2024.
David A. Grogen | CNBC
Buffett did not reveal the specific company he’s looking at north of the border or whether it was public or private.
“Obviously, there aren’t as many big companies up there as there are in the United States,” Buffett said. “There are things we actually can do fairly well that Canada could benefit from Berkshire’s participation.”
Canada’s S&P/TSX Composite Index is up about 5% this year. The economy has large financial and commodity industries.