Good Evening. U.S. stocks fell on Friday, with the tech industry quickly ending a three-day winning streak.
The tech-heavy Nasdaq dropped 1.87% on Friday after Snap’s (SNAP) results hurt the industry and shocked the digital advertising market. The Dow fell 0.43% and the S&P 500 fell 0.93%.
EARNINGS KEEP AXP IN THE GREEN
CEO Stephen Squeri of American Express (AXP) is optimistic about the second half of the year following a strong quarter.
Revenue: $13.4 billion vs. $12.51 billion
Earnings Per Share: $2.57 vs. $2.39
AXP also increased its full-year sales forecast from an earlier estimate of 18%-20% growth to 23%-25 % growth. Earnings are still anticipated to be between $9.25 and $9.65 per share. Global Commercial Services profits at AmEx decreased to $817 million from $835 million in 2021. Global Consumer Services reported $1.4 billion in profits, down from $1.9 billion in the prior-year period.
Squeri told Yahoo Finance, “We’re acquiring spending and we see future travel bookings [strong] so I don’t see it [a recession] in my numbers at all.” The idea that there will be a significant slowdown in the third or fourth quarters is something Squeri found extremely difficult to comprehend. He says that he does not see [a recession] because, if we learned anything from the pandemic, it is that you kind of go day-to-day and month-to-month.
AMAZON SPREADS ITS UMBRELLA
Amazon made its biggest foray into the healthcare industry by forking over $3.9 billion to purchase One Medical, a primary care provider. Your Prime membership might soon include a free physical examination.
One Medical: What Is It? a business that runs more than 180 medical offices in 25 US markets and provides both physical and online medical care. It followed a similar trajectory to other high-flying startups when it went public in January 2020: a huge spike during a period of feverish demand for telehealth, followed by an equally huge crash that caused its stock price to drop significantly below its IPO price.
What makes health care a top priority then? Every time you pay a medical bill, you are painfully aware of the size of the health care industry. With a $4 trillion market, it represents about 20% of the US economy as a whole. A medical industry that is tangled in a complex web of insurance companies and governmental regulations is one area Amazon sees potential to expand outside of its core competencies.
However, Amazon’s obsession with healthcare is nothing new. It purchased the online pharmacy PillPack in 2018, and a year later it introduced its own on-demand medical services. Some of its high-profile joint ventures, like the one with JPMorgan and Berkshire Hathaway, failed, highlighting how difficult it is for anyone—not just Bezos and Buffett—to enter the medical industry.
Even though they made mistakes, Amazon and Big Tech won’t give up. Apple just this week published a 60-page report outlining why the company will make health care a top priority moving forward.