Samsung Electronics Co (OTC:SSNLF) reported first-quarter revenue growth of 10% year-on-year to 79.1 trillion Korean won ($55.5 billion) Wednesday.
Revenue growth marked an all-time quarterly high, driven by strong sales of flagship Galaxy S25 smartphones and high-value-added products.
Operating profit was 6.7 trillion Korean won ($17.62 billion), up from 6.6 Korean won a year ago, despite headwinds for the DS Division.
Also Read: Samsung’s China Chip Pivot Gains Steam With 54% Export Surge Amid US Market Struggles
The DS Division (encompassing Memory and S.LSI / Foundry) posted revenue of 25.1 trillion Korean won (versus 23.1 trillion Korean won Y/Y).
The division reported 1.1 trillion Korean won in operating profit (versus 1.9 trillion Korean won Y/Y) due to the erosion of average selling price (ASP) and a decrease in HBM sales due to export controls on AI chips and deferred demand in anticipation of upcoming enhanced HBM3E products.
Samsung Display Corp Division (SDC) posted 5.9 trillion Korean won in revenue (versus 5.4 trillion Korean won Y/Y) and 0.5 trillion Korean won in operating profit (versus 0.3 trillion Korean won Y/Y).
The Mobile eXperience (MX) and Networks businesses posted 37.0 trillion Korean won in revenue (versus 33.5 Korean won Y/Y). The division reported 4.3 trillion Korean won in operating profit (versus 3.5 trillion Korean won Y/Y).
The quarterly capex was 12.13 trillion Korean won, down from 13.42 trillion Korean won a year ago.
Samsung’s flagship products, including semiconductors, smartphones, and tablets, are now exempt from reciprocal tariffs. Still, President Donald Trump has indicated that a tariff on the electronics supply chain, including chips, is in the works, Bloomberg reported Wednesday.
Seoul and Washington agreed to pursue a comprehensive package agreement by July 8, when the 90-day tariff pause will end.
Samsung has struggled for months to secure Nvidia Corp’s (NASDAQ:NVDA) final nod for its most advanced HBM products, making it challenging to compete with Taiwan Semiconductor Manufacturing Co (NYSE:TSM).
Samsung is in talks to supply customized sixth-generation high-bandwidth memory, or HBM4, chips to major AI chipmakers, including Nvidia, Broadcom Inc (NASDAQ:AVGO) and Alphabet Inc (NASDAQ:GOOG) (NASDAQ:GOOGL) Google, the Korea Economic Daily reported Wednesday.
Outlook: In the second quarter, the Memory Business anticipates robust demand for AI servers and a ramp-up of the enhanced HBM3E 12H.
AI-related demand is expected to remain high in the second half, in conjunction with the launch of new GPUs.
In the second quarter, the System LSI Business will maintain steady revenue by gaining SoC adoption by a major customer for new flagship models and capitalizing on the growing adoption of 200-megapixel sensors.
In the second half, the System LSI Business will expand its flagship SoC supply and develop its automotive sensor portfolio.
In the second quarter, the Foundry Business will stabilize its 2nm process production and drive earnings improvement by actively addressing strong mobile and automotive demand in the United States. Looking ahead to the second half, the Foundry Business aims to start 2nm mass production, secure major 2nm orders, and strengthen its specialty process portfolio on mature nodes.
In the second quarter, the mobile display business maintained a conservative outlook on earnings while pursuing a stable supply of new products such as foldables.
In the second half, SDC aims to grow mobile display business sales through differentiated technologies and products.
In the second quarter, MX Business plans to sustain flagship-centric sales amid weak seasonality by successfully launching the Galaxy S25 Edge. It will also expand its AI smartphone lineup by introducing “Awesome Intelligence” to the Galaxy A series.
In the second half, the MX Business will strengthen its foldable lineup by offering a differentiated AI user experience. In addition, the Business will launch new ecosystem products with enhanced AI and health capabilities and explore new product segments such as XR.
In the second quarter, Visual Display and Digital Appliances intends to expand TV sales with its 2025 AI TV lineup and the integration of advanced AI functions.
In the second half, the Business will focus on capturing peak season demand through strategic collaboration with distributors based on an enhanced AI TV lineup.
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DA Davidson analyst Tom White upgraded Airbnb, Inc. (NASDAQ:ABNB) from Neutral to Buy, lowering the price forecast from $170 to $155.
The analyst writes that while leisure travel spending isn’t fully shielded from economic downturns—as seen during the Global Financial Crisis—online lodging and alternative accommodation are likely to remain relatively resilient.
This is driven by the continued global shift toward digital bookings, with major OTAs like Booking and Expedia having grown gross bookings even during the Global Financial Crisis, partly aided by M&A, White adds.
Additionally, Airbnb’s vast inventory of over eight million listings across 240+ regions positions it well to meet diverse budget needs.
Its recent affordability initiatives, such as upfront pricing and discounts for longer stays, helped stabilize average prices last year, even as hotel rates climbed.
White states that Airbnb’s new tech product cycle can potentially bring a sizable new revenue stream to the company’s asset-light model.
After a 23% pullback in the stock in the last year, it is trading at a lower multiple than the historical average and compared to some peers.
White shared that Airbnb has been added to D.A. Davidson’s Best-of-Breed Bison list, which highlights top-tier companies with long-term potential.
According to the analyst, Airbnb satisfies 11 of 12 key criteria, supported by its leading market position, robust margins, healthy cash flow, and a valuation seen as undervalued relative to its long-term intrinsic value.
White trimmed 2025 revenue estimates by 2.5% due to potential macro and recessionary headwinds. Adjusted EBITDA for 2025 was also lowered by 4%.
Price Action: ABNB shares closed lower by 2.84% to $121.92 on Wednesday.
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Scotiabank analyst Maher Yaghi upgraded T-Mobile US (NASDAQ:TMUS) from Sector Perform to Sector Outperform and raised the price target to $277.50 from $275. The stock traded higher Wednesday following the call.
Despite earlier fears of a slowdown in the U.S. wireless market, recent earnings from mobile operators and cable companies show industry loading remains healthy, with an annual run rate of about 8.5 million.
Yaghi called last week’s 10% drop in T-Mobile shares an overreaction. He emphasized that T-Mobile’s share of phone net adds is consistent with its four-year average, indicating steady performance.
Also Read: T-Mobile Beats Estimates, But Customer Growth Leaves Investors Wanting More, Says Analyst
The analyst downgraded the stock a few months back due to valuations, but the scenario is different today. Valuations are supportive; hence, the stock was upgraded with a slightly increased target due to higher estimates.
Earlier this year, T-Mobile peers commented that the US wireless market was seeing a slow start. Yaghi noted that the US market should see phone subscriber growth of 1.5-2% annually in 2025.
T-Mobile’s share of phone net adds was 35% in the first quarter of 2025. That’s the same as the first quarter of 2024 and in line with the four-year average of 36% for the first quarter. This shows consistency in loading within a very dynamic market.
The analyst expects loading at T-Mobile US to accelerate as the year progresses, similar to normal seasonality. The company’s financial guidance actually provides a great hint that management expects strong loading in the second half.
In the first quarter, core adjusted EBITDA growth was 8%, while guidance implies that growth will decelerate. Some of that deceleration in growth is due to increased investments in AI and customer service, but also, very importantly, higher loading costs to support the company’s highest-ever annual postpaid guide. In summary, Yaghi noted that the path for growth in front of T-Mobile US has not diminished.
Yaghi projected second-quarter of $20.81 billion and EPS of $2.63.
Price Action: T-Mobile US stock is up 2.19% to $246.88 at last check Wednesday.
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Abeona Therapeutics Inc.‘s (NASDAQ:ABEO) stock traded higher on Wednesday.
The Food and Drug Administration (FDA) on Tuesday approved Abeona’s Zevaskyn (prademagene zamikeracel) gene-modified cellular sheets, also known as pz-cel, as the first and only autologous cell-based gene therapy for wounds in adult and pediatric patients with recessive dystrophic epidermolysis bullosa (RDEB).
Zevaskyn is the only FDA-approved product to treat RDEB wounds with a single application.
Zevaskyn consists of a patient’s skin cells (keratinocytes) genetically modified to produce functional Type VII collagen. Zevaskyn sheets are surgically applied to the patient’s wounded areas. In a single application, up to 12 credit card-sized sheets can be combined to cover large areas or applied to multiple distinct wounds, allowing for significant coverage of affected body areas.
HC Wainwright writes the approval was granted on time, showing that the agency can still meet deadlines despite recent disruptions. Analyst Raghuram Selvaraju on Wednesday wrote that pz-cel is well-positioned to become the leading treatment for the most severe cases of recessive dystrophic epidermolysis bullosa (RDEB).
It may also be used on its own or alongside other approved treatments like Krystal Biotech, Inc.’s (NASDAQ:KRYS) Vyjuvek (beremagene geperpavec) in certain patients.
On Monday, the European Commission approved Vyjuvek for wounds in patients with dystrophic epidermolysis bullosa who have mutations in the collagen type VII alpha 1 chain (COL7A1) gene, starting from birth.
- The timing for the availability of VYJUVEK in individual countries will depend on multiple factors, including the completion of reimbursement procedures.
- The company is planning for its first European launch in Germany in mid-2025.
The list price for Zevaskyn has been revealed at $3.1 million per treatment, much higher than the $800,000 we previously assumed, the analyst said.
Based on this new price, the analyst estimates that treating 10–15 patients by the end of 2025 could bring Abeona over $30 million in sales.
HC Wainwright’s updated revenue forecast for 2025 is now $31.6 million, increasing to $130.4 million in 2026.
HC Wainwright continues to project peak U.S. sales of around $600 million. Abeona believes there are about 750 potential patients in the target population, which could mean a market opportunity of over $2 billion if all were treated with Zevaskyn.
Analyst Selvaraju maintains the Buy rating and raise the price target from $15 to $20 per share, reflecting increased confidence in the drug.
Price Action: ABEO stock was up 23.77% to $6.56 on Wednesday.
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RBC Capital Markets analyst Daniel R. Perlin reiterated his Outperform rating on Visa Inc. (NYSE:V) on Wednesday, with a price forecast of $395.
On Tuesday, Visa reported second-quarter earnings of $2.76 per share, which beat the analyst consensus estimate of $2.68. Quarterly revenue came in at $9.59 billion, which beat the analyst consensus estimate of $9.55 billion.
Perlin noted that, despite ongoing market uncertainty, Visa’s results provide insight into consumer health, with adjusted U.S. spending volumes remaining steady in the fiscal second quarter and through April 28, although some category shifts and a slight slowdown in cross-border activity were observed.
Also Read: Mastercard Vs. Visa: Two Giants, One Payment War — Who’s Ready To Outperform?
While there are some minor positives and negatives, full-year 2025 guidance remains unchanged, with management prepared to adjust if the data warrants it.
Perlin pointed to three positives from Visa’s results: First, payment volumes remained strong, with only a slight deceleration in fiscal Q2, and U.S. volumes improved in April, indicating steady consumer spending. Second, value-added services revenue grew 22% year over year, with gains in Pismo and Featurespace suggesting added resilience beyond spending cycles.
Lastly, Visa announced a new $30 billion share repurchase program.
Taking the latest results and outlook into account, the analyst updated his forecasts for FY25 and FY26, maintaining revenue estimates at $39.5 billion and $43.8 billion while slightly raising adjusted EPS for FY25 to $11.30 from $11.20 and keeping FY26 EPS steady at $12.75.
Price Action: V shares are trading higher by 0.49% to $343.18 at last check on Wednesday.
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On Tuesday, Pfizer Inc. (NYSE:PFE) reported first-quarter 2025 adjusted EPS of 92 cents, compared to 82 cents a year ago, beating the consensus of 67 cents. Sales fell 8% year over year to $13.71 billion, slightly below the consensus of $13.95 billion.
Pfizer said it plans to save an extra $1.2 billion through its ongoing cost-cutting efforts, aiming to reach that goal by the end of 2027.
The company still plans to achieve $4.5 billion in savings by the end of 2025. With the new target, total program savings are expected to reach about $5.7 billion by 2027.
Goldman Sachs maintains a Neutral rating, citing a sustained stock re-rate that will require greater clarity on how the company will leverage those additional cash flows to generate new product revenues, as well as the emergence of a new product cycle to drive growth.
Analyst Asad Haider highlights that management maintained its previous guidance of having $10–$15 billion available for business development, with a continued focus on expanding its immunology and cardiometabolic portfolios.
After the recent decision to stop developing danuglipron, obesity remains a key area of interest for ‘external innovation’.
On the broader M&A environment, management noted that sellers are still adjusting to lower market valuations. However, many potential deals—especially from China—are pushing some companies to become more open to accepting lower prices.
Haider pointed out that investors paid close attention to CEO Albert Bourla’s comments on tariffs. Bourla said the government’s primary concern is national security — ensuring that essential medicines are not produced outside the U.S. He also emphasized that it is crucial to understand which products come from which places when considering national security.
Unlike its peers, Pfizer did not highlight investments in new manufacturing plants; it noted they already have significant capacity and flexibility to manufacture their products in the U.S.
Price Action: PFE stock is up 1.74% at $24.21 at the last check Wednesday.
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JPMorgan analyst Doug Anmuth reiterated an Overweight rating on Spotify Technology (NYSE:SPOT) and raised the price target to $670 from $640 on Tuesday. Shares were trading higher on Wednesday.
As the largest pure-play audio streaming platform, Spotify continues to benefit from the broader shift from transaction-based to access-based models. The company is growing monthly active users (MAUs) at roughly 10% and is generating positive free cash flow.
Also Read: Spotify Adds 3 Million Subscribers But Profit Miss Sends Stock Sliding
Anmuth sees Spotify’s post-earnings pullback as a buying opportunity, citing solid mid-teens growth and continued progress toward its medium-term margin goals. The stock declined on lighter Q2 MAUs, margin variability, and tempered expectations for the superfan tier. Still, Spotify remains confident in strong second-half MAU growth, supported by product improvements, efficient marketing, and its year-end Wrapped campaign.
Anmuth also expects Spotify to keep investing in its core Music offering while expanding across Audiobooks, Video, and Podcasts. He projects:
- 2025 net adds of 67 million MAUs (down from 73 million in 2024)
- 24 million Premium Subscribers (vs. 27 million in 2024).
- 15% FX-neutral revenue growth, including 9% growth in Premium Subscribers
- A 4% FX-neutral ARPU increase.
- Gross margins expanding to 31.8% (+160bps Y/Y)
- Operating margins to 12.7% (+400bps Y/Y)
- Free cash flow reaching €2.9 billion (+26% Y/Y).
Margin gains will be front-loaded, with sequential compression in Q2 and Q3 due to continued growth investments, Anuth says.
Overall, he models average 2025–2026 FX-neutral revenue growth of 13%, gross profit growth of 17%, operating income growth of 44%, and free cash flow growth of 20%—metrics he says justify Spotify’s premium valuation.
Price Action: Spotify stock traded higher by 6.42% at $613.98 at the last check on Wednesday.
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Starbucks Corp (NASDAQ:SBUX) on Tuesday reported worse-than-expected results for the second-quarter FY25. Analysts from various brokerages have provided their comments on the coffee house giant’s performance.
Goldman Sachs analyst Christine Cho downgraded the shares from a Buy to a Neutral rating and lowered the price target from $103.00 to $85.00.
The analyst cited weakening brand momentum and a slower-than-expected sales recovery in North America as the main reasons for the downgrade.
Despite recent operational changes under CEO Brian Niccol, including a revamped menu and faster service goals, key customer engagement metrics continue to decline.
Foot traffic shows modest stabilization, but not enough to suggest market share gains, the analyst said, citing rising macroeconomic and geopolitical uncertainties, along with higher costs, which add further pressure.
HundredX data reveals that SBUX continues to trail behind its coffee industry peers in consumer sentiment. Both its Net Purchase Intent (NPI) and Net Promoter Score (NPS) have declined year-to-date and remain below the category average.
Due to rising tariff uncertainty and a weakening inflation outlook, the analyst expects continued pressure on SBUX North America same-store sales growth (SSSG) in fiscal 2025. Forecasts predict a 1% decline in SSSG, driven by a 4% decrease in traffic.
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Current data from Placer and Second Measure show no significant recovery in foot traffic or sales, suggesting that ongoing headwinds even predated the materialization of tariff impacts, noted the analyst.
RBC Capital Markets analyst Logan Reich reiterated an Outperform rating on the shares and lowered the price forecast from $100.00 to $95.00.
SBUX posted mixed results in the second quarter, with North American same-store sales aligning with forecasts but international markets, especially China, outperforming expectations.
Licensed store revenue fell short, impacted by reduced foot traffic at franchisee locations. For the third quarter, the company anticipates a 3% drop in sales and flat revenue in North America, missing market projections.
Starbucks is rolling out a new labor model to improve service speed, currently in 700 stores and aiming for more than 3,000 by the end of the fiscal year. While this has led to quicker service times, higher labor costs may pressure profit margins, noted the analyst.
Coffee and tariff-related costs pose additional margin risks. Although Starbucks hedges coffee prices, recent spikes could soon impact its financials.
Management indicated that 50% of its tariff exposure is tied to coffee, 25% to Chinese merchandise, and 25% to other imports, though exact margin impacts were not disclosed.
The company is also slowing unit growth, reassessing underperforming stores, and shifting focus from coastal markets to the U.S. interior and South.
Elevated build costs and lower returns have led to increased closures, although Starbucks remains committed to doubling its U.S. store count, the analyst concluded.
Price Action: SBUX shares were down 5.6% to $80.05 on Wednesday.
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Wingstop Inc. (NASDAQ:WING) shares traded higher on Wednesday after the company reported first-quarter results.
The restaurant franchise reported first-quarter earnings per share of 99 cents, beating the street view of 90 cents. Quarterly sales of $171.1 million (+17.4% year over year) marginally beat the analyst consensus estimate of $170.92 million.
System-wide sales rose 15.7% to $1.3 billion in the first quarter of FY25.
The company added 126 net new locations, with domestic AUV reaching $2.1 million.
Also Read: Starbucks Stock Tumbles On Q2 Earnings, CEO Says Progress Is Happening ‘Below The Surface’
Domestic same-store sales grew by 0.5% in the quarter. Digital sales accounted for 72.0% of total system-wide sales.
Adjusted EBITDA rose 18.4% to $59.5 million in the quarter.
As of March 29, there were:
- 2,689 Wingstop restaurants system-wide.
- Of that amount, 2,301 restaurants in the U.S.
- 2,250 were franchised restaurants
- 51 were company-owned.
- 388 franchised restaurants were in international markets, including U.S. territories.
“We opened a record 126 net new units in the first quarter, delivering 18% unit growth, nearly doubling the number of units opened during the first quarter last year,” said Michael Skipworth, President & Chief Executive Officer.
Following the results, Stephens & Co. analyst Jim Salera reiterates Wingstop with an Overweight and maintains a $385 price forecast.
TD Securities analyst Andrew Charles reiterated a Buy rating on Wingstop and maintained a $265 price forecast.
Dividend: On April 29, Wingstop’s board declared a quarterly dividend of $0.27 per share, totaling approximately $7.5 million.
Shareholders of record as of May 16 will receive the dividend on June 6.
Outlook: Wingstop has updated its 2025 guidance based on year-to-date performance while noting ongoing macroeconomic uncertainty.
The company now expects approximately 1% domestic same-store sales growth, down from its prior low- to mid-single-digit forecast.
Global unit growth is projected at 16% to 17%. That’s up from the earlier estimate of 14% to 15%.
Price Action: Wingstop shares are trading higher by 11.2% to $256.26 at last check Wednesday.
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PayPal Holdings Inc (NASDAQ:PYPL) shares are trading lower on Wednesday. Several analysts lowered the price forecast/rating on the stock after first-quarter results reported on Tuesday.
Quarterly revenue growth was 1% year-over-year to $7.79 billion, missing the analyst consensus estimate of $7.84 billion. Adjusted EPS was $1.33, beating the analyst consensus estimate of $1.16.
PayPal expects a second-quarter adjusted EPS of $1.29-$1.31, compared to $1.19 for the previous year’s period, and the analyst consensus estimate is $1.21.
PayPal reiterated full-year 2025 adjusted EPS of $4.95-$5.10, compared to $4.65 Y/Y. Currently, analysts estimate an EPS of $5.01.
RBC Capital Markets analyst Daniel R. Perlin slashed the price forecast for PYPL from $104 to $88, while keeping an Outperform rating.
The analyst writes that despite ongoing complexities in the company’s transition, he sees near-term indicators supporting continued success.
The positive factors include Branded checkout (online) Total Payment Volume (TPV) maintaining a steady 6% year-over-year growth (excluding FX and Leap Day), with over 45% of U.S. transactions utilizing the latest technology.
Also, transaction margin dollars increased by 7% year-over-year and significant continued growth in Venmo monetization through Pay with Venmo and the debit card are tailwinds, adds the analyst.
Perlin considers the unchanged FY25 guidance prudent given the current uncertain macroeconomic and geopolitical environment, providing flexibility for the second half of the year.
The analyst revised FY25 revenue and adjusted EPS estimates to $32.12 billion and $5.10 (from $32.19 billion and $5.00, respectively), and FY26 estimates to $33.18 billion and $5.85 (from $33.70 billion and $5.80, respectively).
Canaccord Genuity analyst Joseph Vafi maintained a “Buy” rating with a price target of $96.00.
The analyst writes that the first quarter marked another quarter of steady progress in PayPal’s business realignment under its new CEO, Alex Chriss, who has been in the role for just over a year.
Vafi says that the quarter was notable for transaction-margin dollar growth contributions from both branded and, importantly, now unbranded payment volume.
While some on Wall Street expressed disappointment regarding revenue headwinds stemming from the non-renewal of certain low or negative-margin unbranded volume contracts in the last quarter, the analyst views this as a sound strategic move.
Vafi sees transaction-margin dollar growth as the key metric to monitor, at least in the near term.
Goldman Sachs analyst Will Nance writes that earnings positives include de-risked numbers, faster-than-expected branded checkout upgrades (45% of U.S. branded on newest integration), strong growth in Pay with Venmo TPV (50%+), debit card TPV (60%+), and BNPL (20%+), and improved Braintree yields.
Nance cited range-bound to slightly weaker branded checkout volumes and outperformance driven by credit products as a negative factor.
Overall, the analyst is cautious on the longer-term trends due to favorable margin dynamics (low-single-digit opex growth) and significant capital return/FCF.
JP Morgan analyst Tien-Tsin Huang slashed the price forecast from $90 to $75, maintaining an Overweight rating.
The analyst says that the results offered points for both positive and negative perspectives, but they feel incrementally better about the stock’s setup.
Positives include stable spending (excluding Leap Year), positive commentary on business diversification (US-China cross-border, retail/discretionary split), and a reiterated guide, which provides a second-half cushion, according to the analyst.
Huang says that negatives include slightly soft branded growth (+4% vs. JPMe +5%) and questions about the beat’s quality due to strong credit growth (easier comparison).
Strong product ramp-up (Venmo revenue +20%, 45% of U.S. on modern checkout) supports improving growth and execution in a stable macro, aligning with management’s investor day commitments, the analyst added.
Price Action: PYPL shares are down 1.6% at $65.20 at last check Wednesday.
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Mobile learning platform Duolingo Inc. (NASDAQ:DUOL) has introduced its most extensive course expansion to date, launching 148 new language programs on its platform.
This substantial growth more than doubles its existing offerings. The launch makes Duolingo’s top seven non-English languages, Spanish, French, German, Italian, Japanese, Korean, and Mandarin accessible across all 28 of its supported interface languages.
In the past, developing a single language course on Duolingo could take several years. But with the help of generative AI, enhanced internal tools, and a new shared content system, the company has shortened that process, rolling out its newest set of courses in less than a year.
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“Developing our first 100 courses took about 12 years, and now, in about a year, we’re able to create and launch nearly 150 new courses. This is a great example of how generative AI can directly benefit our learners,” said CEO and co-founder Luis von Ahn.
This shared content model enables the creation of a core course structure that can be quickly adapted for multiple languages.
The majority of the newly launched courses are designed for beginners, aligning with A1–A2 levels on the CEFR scale, and include interactive tools such as Stories and DuoRadio to help reading and listening comprehension.
Duolingo noted that higher-level content is expected to be added in the coming months.
The release is especially impactful in regions where access to non-English courses was previously limited. In Latin America, Spanish and Portuguese speakers now have access to Asian languages like Japanese, Mandarin, and Korean.
In Europe, learners speaking languages such as French, German, or Italian can also explore these new additions.
Meanwhile, in Asia, speakers of languages like Hindi, Thai, and Tamil can now learn any of the top seven languages, whereas previously, their options were largely restricted to English.
Price Action: DUOL shares traded higher by 0.35% at $386.48 at last check Wednesday.
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Illinois Tool Works Inc. (NYSE:ITW) stock was trading lower on Wednesday after the company reported better-than-expected first-quarter 2025 results.
The company reported revenue of $3.84 billion, a 3.4% decline year over year, which aligns with the consensus estimate. EPS for the quarter stood at $2.38, down from $2.73 YoY and above the consensus of $2.36.
Organic revenue declined by 1.6%, while organic revenue remained nearly flat on an equal-day basis. Foreign currency translation had a negative impact of 1.8% on revenue.
Revenue By Segments: Automotive OEM $786 million (-3.7% YoY), Food Equipment $627 million (-0.7% YoY), Test & Measurement and Electronics $652 million (-6.3% YoY), Welding $472 million (-0.9% YoY), Polymers & Fluids $429 million (-0.8% YoY), Construction Products $443 million (-9.2% YoY) and Specialty Products $435 million (-1% YoY).
Operating income decreased 15.6% year over year to $951 million, and the operating margin contracted 360 bps to 24.8%. Enterprise initiatives contributed 120 basis points, offset by higher restructuring expenses from 80/20 projects and one-time items.
ITW’s operating cash flow was $592 million for the quarter, with free cash flow of $496 million, reflecting a 71% conversion to net income. The company repurchased $375 million of its shares during the quarter.
“Acknowledging the uncertain external environment, we are maintaining our full year 2025 guidance as we expect our ongoing pricing actions to offset tariff cost impacts. ITW is built to outperform in today’s volatile environment,” commented Christopher A. O’Herlihy, president and CEO.
“Our largely ‘produce where we sell’ manufacturing strategy, decentralized operating culture which enables rapid ‘read and react’ response, and diversified high-quality business portfolio all provide resilience during times of volatility and uncertainty. Our strong financial profile allows us to maintain our strategic investments and focus on driving continued progress on our long-term strategy to make above-market organic growth, fueled by Customer-back Innovation, into a core ITW strength,” O’Herlihy concluded.
2025 Guidance reaffirmed: ITW maintains its GAAP EPS guidance of $10.15 – $10.55 versus the consensus of $10.27.
Revenue and organic growth are projected to be 0-2%, with an operating margin expected between 26.5% and 27.5%.
The free cash flow is expected to exceed 100% of net income, and the company plans to repurchase $1.5 billion in shares. The projected effective tax rate is 24%.
Price Action: ITW shares traded lower by 3.58% at $233.10 at the last check Wednesday.
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Goldman Sachs analyst Jerry Revich expressed views on Caterpillar Inc. (NYSE:CAT) first-quarter earnings reported on Wednesday.
The analyst maintained a Buy rating with a price target of $388.
The company reported a 9.8% year-over-year decline in sales and revenue to $14.25 billion, missing the consensus of $14.66 billion.
Adjusted EPS of $4.24 came below the consensus of $4.35.
Caterpillar expects tariffs to create an additional cost headwind of $250 million to $350 million in the second quarter, net of initial mitigation actions and cost controls
The analyst notes that the company reported a solid performance, with a 2% earnings beat versus Goldman Sachs’ estimates and a moderate 200-300 basis point headwind from tariffs, before mitigation.
Also, the company saw a strong order growth of 20% resulting in a 1.37x book-to-bill ratio, and a $400 million dealer inventory destock on a seasonally adjusted basis, adds the analyst.
The analyst estimates EPS of $19.26 in 2025, $21.27 in 2026 and $23.04 in 2027.
Investors can gain exposure to the stock via Amplify CWP Enhanced Dividend Income ETF (NYSE:DIVO) and Global X Funds Global X Dow 30 Covered Call ETF (NYSE:DJIA).
Price Action: CAT shares are down 1.2% at $303.21 at the last check Wednesday.
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Quantum Computing Inc. (NASDAQ:QUBT) shares are trading lower on Wednesday.
The firm announced a new subcontract to develop a breakthrough quantum computing solution that will improve NASA’s ability to analyze atmospheric data.
The project, with a potential value of $406,478, will support NASA’s Langley Research Center in enhancing space LIDAR data quality by eliminating sunlight interference.
Quantum Computing secured the contract through Analytical Mechanics Associates (AMA), the primary contractor on the RSES IDIQ vehicle.
The engagement runs through May 31, 2026, and will operate on a time-and-materials basis.
Also Read: Mastercard Vs. Visa: Two Giants, One Payment War — Who’s Ready To Outperform?
The initiative will utilize Quantum Computing’s Dirac-3 quantum platform to develop and refine algorithms designed to suppress solar noise from LIDAR data gathered during daylight hours.
Daylight interference has long posed a challenge to NASA’s efforts in space-based atmospheric sensing, often requiring bulky, power-intensive optical solutions to compensate for poor signal clarity.
Instead of relying on larger optics or stronger lasers, Quantum Computing’s solution leverages quantum optimization to enhance the signal-to-noise ratio without increasing physical system demands.
The approach promises to reduce payload size, weight, and power consumption — key metrics in controlling mission costs and complexity.
According to Dr. William McGann, CEO of Quantum Computing, this project builds on a history of successful NASA collaborations and highlights growing confidence in the company’s quantum capabilities. “Our goal is to deliver a quantum-based denoising solution that could materially reduce the cost and complexity of space-based LIDAR missions,” he stated.
Quantum computing plans to demonstrate the effectiveness of the technology in analyzing existing data from NASA’s CALIPSO and ICESat-2 satellites.
A successful implementation could pave the way for the use of smaller, more efficient hardware in future Earth observation missions, potentially transforming how climate and atmospheric research is conducted from orbit.
Price Action: QUBT shares are trading lower by 4.05% to $6.620 at last check Wednesday.
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Huawei Technologies has started delivering its advanced artificial intelligence chip “cluster” to Chinese clients, who ramped up orders after Washington’s semiconductor sanctions cut them off from Nvidia Corp’s (NASDAQ:NVDA) sophisticated technology.
The erstwhile Chinese smartphone giant has sold over 10 sets of CloudMatrix 384, which fuses a large sum of chips, the Financial Times reported Wednesday, citing unnamed sources familiar with the matter.
Nvidia stock is trading lower on Wednesday.
Also Read: Nvidia Powers Next-Gen Adaptive Digital AI Agents For Cisco, Nasdaq, And Meta
Dylan Patel of SemiAnalysis told the Financial Times that Huawei’s CloudMatrix 384 development signifies that China now has an AI system capable of beating Nvidia.
Nvidia projected a $5.5 billion earnings hit after President Donald Trump mandated a license to sell H20 chips to China.
Huawei claimed its CloudMatrix outperformed Nvidia’s NVL72 AI cluster, which consists of 72 of its GB200 chips, the Financial Times cited from a company presentation.
CloudMatrix 384 uses Huawei’s Ascend 910C chips, which underperform Nvidia’s GB200 processors. However, Huawei has used a larger quantity of chips connected by its “super node.”
However, CloudMatrix 384 has several disadvantages compared to Nvidia, industry experts told Financial Times.
CloudMatrix 384 has much higher energy consumption due to the higher number of chips, and Huawei’s software systems require more maintenance from experienced engineers, entailing higher costs than Nvidia.
CloudMatrix 384 sells for about 60 million Chinese yuan ($8.2 million), a set compared to $3 million for Nvidia’s NVL72.
BofA Securities analyst Vivek Arya had highlighted growing concerns that AI data center buildouts might peak in 2025 and then considerably slow down afterward.
However, he also expects that capex from non-CSPs, including emerging cloud vendors, enterprises, and national AI infrastructure projects, could be an additional source of sustaining AI investments.
Arya’s top AI picks were Nvidia and Broadcom Inc (NASDAQ:AVGO), respective merchant and custom AI silicon leaders.
Price Action: NVDA stock is down 1.23% at $107.68 at the last check Wednesday.
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