Stocks gave up substantial ground Friday, as a host of negative earnings announcements combined with the threat of the dispute between Russia and Ukraine blossoming into outright war to send major stock market benchmarks sharply lower today. Plug Power (NASDAQ:PLUG), Pandora Media (NYSE:P), and Amazon.com (NASDAQ:AMZN) all did their part in leading the stock market down, closing the week with an overall loss despite having had gains earlier in the week.
Plug Power dropped 11% after the company priced its secondary stock offering last night at $5.50 per share, representing about an 8.5% discount to where the shares had closed Thursday night. Although Plug Power raised the possibility of using the proceeds for capital expenditures or potential acquisitions that could be favorable for the company in the long run, skeptical investors saw the move simply as another in a long series of dilutive offerings for the fuel-cell company. In the process, investors have largely ignored Plug Power's deal with Hyundai Hysco from earlier this week, which Fool energy specialist Tyler Crowe argues could actually be a step in the right direction for Plug Power in its efforts to grow and gain a greater foothold in the Asia-Pacific region.
Pandora Media plunged 17% after the streaming-music service gave current-quarter guidance that fell short of investors' lofty expectations. Pandora managed to boost its adjusted sales by 54% from the year-ago quarter, with a slightly narrower loss than investors had anticipated. Yet, guidance from Pandora that it might just barely break even on an adjusted basis in the second quarter left shareholders worried about the growth trajectory for the company, especially given that listener hours figures for the first quarter only grew at a 12% clip, with active listener growth slowing to 8%. If revenue for the current quarter comes in at the lower end of guidance, Pandora could have an ongoing problem for growth-hungry shareholders.
Amazon.com dropped almost 10% as investors paid an uncharacteristically large amount of attention to the online-retail giant's future bottom-line guidance. Sales soared 23%, sending earnings-per-share up by 27%, and Amazon projected that current-quarter revenue would be roughly consistent with investor expectations. Yet, even after many past quarters in which Amazon chose to make expenditures that reduced net income, many investors blamed the stock's drop on Amazon's guidance for an operating loss next quarter. The operating loss comes mostly from special items like stock-based compensation, but what seems a more likely reason for the stock's plunge is simply that high-growth investors lost patience temporarily with CEO Jeff Bezos and his well-established strategy of deferring profit in exchange for gaining greater market share. It'll be interesting to see if Amazon and Bezos change their way of doing business simply because shareholders panicked today.