SoftBank shares surged more than 8% in morning trading after chipmaker Arm posted results that exceeded expectations. Arm shares soared nearly 41% following the release of revenue and earnings that surpassed analysts’ estimates, as well as providing strong guidance for the coming quarter. SoftBank, which still owns about 930 million shares, increased its stake in Arm by almost $16 billion to $87.4 billion after the earnings report, which is significantly more than the $14 billion in losses suffered from co-working space provider WeWork going bankrupt in November. The gains from Arm earnings far exceeded the losses suffered at investing in WeWork, noting how SoftBank’s investment in the latter led to a filing for bankruptcy. Conversely, SoftBank’s investment in Arm has paid huge dividends, contributing to the surge in its share price in morning trading.
On the brink of making history, the S&P 500 crossed 4,999.89, bringing it closer to the 5,000 threshold. It took nearly three years for the large-cap benchmark to reach 1,000 points since it first crossed and closed above 4,000 on April 21, 2021. Seeing it at a stride distance of the historic 5,000 level, it reflects the strong growth faced in the economy and the financial market in recent years.
Meanwhile, PayPal shares took a hit, dropping more than 5% after the company provided guidance for the full year and first quarter that missed the market’s expectations. Anticipating full-year earnings of $5.10 per share, below the $5.48 expected by analysts, the payments company missed the mark. Despite beating estimates for fourth-quarter results, the weak guidance for the full year and first quarter led to a decline in PayPal’s shares in extended trading. With immense competition in the payments industry, PayPal will have to reassess its strategy to meet market expectations, showing the challenges it faces while still being a dominant player in its field.