📉 Tesla's revenue couldn't steer itself

What’s going on here?

Tesla reported its first revenue drop in four years late on Tuesday.

What does this mean?

Investors weren’t expecting much from Tesla’s earnings. The EV maker reported earlier this month that it had delivered 20% fewer cars to customers last quarter than the one before, and 8.5% fewer than the same time last year. Worse still, Tesla made a record 46,600 more vehicles than it delivered, suggesting that despite a long run of price cuts, drivers just aren’t that interested. Good job investors braced themselves: with both sales volume and prices dropping, Tesla reported that revenue fell by a more-than-expected 9% last quarter from a year ago.

Why should I care?

The bigger picture: Musk’s head has been turned (again).

Still, investors looked past the revenue slump, distracted by the firm’s commitment to launching a much cheaper EV next year. See, Reuters had reported earlier this month that Tesla was delaying plans to produce the budget-friendly “Model 2”, spending its time and money on self-driving robotaxis instead. And that had worried the many investors who were hoping that a more affordable model would reverse Tesla’s declining sales. Robotaxis, after all, aren’t expected to pad out the bottom line until years down the road – and that could be jeopardized by technology blips or regulatory hurdles along the way. So with the firm putting those rumors to rest on Tuesday, investors initially sent Tesla’s shares up after the update.

For markets: Tesla’s just the start.

Tesla was the first of the “Magnificent Seven” firms to report results from last quarter. And after the group of tech titans drove most of the S&P 500 index’s earnings increase last year, investors are hoping they can keep it up. Bloomberg certainly seems to believe in them: it estimates that the cohort’s collective profit will be 38% higher in the first quarter of this year than last, while the rest of the index will see earnings shrink by 4% over the same timeframe.

What’s going on here?

JD Sports, Britain’s biggest sportswear retailer, announced that it’s buying Hibbett Sporting Goods for over $1 billion, in what must be one of the UK’s biggest-ever sportswear hauls.

What does this mean?

JD Sports has made a name for itself through a sequence of sneaker drops and small acquisitions. The most recent was aimed at Hibbett, a US sporting goods retailer. JD’s buyout pitched Hibbett’s shares at $87.50 each, making for a total valuation of $1.1 billion. There’s no bargain-hunting here: that’s some 21% higher than the $72.49 that Hibbett’s stock was trading for on Monday.

Why should I care?

Zooming in: The American dream.

Europe, Asia, and Australia have been well-trodden by sneakers from JD. But the retailer only has a single-digit market share in the US, despite opening up a flagship outlet in New York’s Times Square four years ago. So teaming up with Hibbett would allow JD to cover more ground without stepping on its own toes. Hibbett has over 1,100 stores around the country, see, which brought in $1.7 billion in sales last year. Combined with JD’s stateside sales from last year, that would be around $5.8 billion – enough to mean 40% of JD’s sales will be from the US, up from today’s 32%.

The bigger picture: Adidas has its running shoes on.

JD sells big-name brands like Nike and Adidas, but it’s no passive spectator: the retailer recently criticized Nike for a lack of innovation in its latest product drop. That, at a time when Nike’s lackluster sales have sent the share price falling 26% over the last year, while Adidas’s stock has increased by 40% in the same timeframe. But if Nike’s Olympic products win gold, then investors might be glad that they backed the underdog.