Stock Indexes Fall as AI Valuation Concerns Resurface; Investors Assess Earnings Reports; Tesla Sinks Ahead of Shareholder Vote

The Shutdown Has Thrown New Uncertainty Into Holiday Air Travel—and Hit Airline Stocks

56 minutes ago

Airports can seem like zoos around the holidays. This year, capacity cuts stemming from the government shutdown could cause a little extra chaos.

Transportation Secretary Sean Duffy yesterday said flight capacity would be reduced by 10% at select airports beginning Friday to keep the workload sustainable for understaffed, and currently unpaid, air traffic controllers. Some 5 million to 6 million travelers have flown for Thanksgiving, the busiest holiday for travel, in recent years, according to the American Automobile Association.

Duffy said officials would today share which 40 airports will be impacted. DOT and Federal Aviation Administration officials didn’t respond to Investopedia’s questions about when further details will be released in time for publication.

It’s unclear when Democrats and Republicans will reach a deal to end a shutdown that has stretched into its second month; Nearly 50% of those wagering on Polymarket, a predictions market, don’t expect a resolution until at least Nov. 16.

The uncertainty weighed on some airline stocks Thursday. Shares of the biggest U.S. airlines were all down recently, with American Airlines (AAL) off by nearly 3%, and Delta (DAL) and Southwest (LUV) airlines dipping about 1%. The JETS ETF, which includes airline stocks, was off about 1.5%.

Read the full article here.

–Sarina Trangle

Why DoorDash’s Stock Is Down 15% Today

1 hr 32 min ago

DoorDash (DASH) shares tumbled Thursday after the food delivery firm missed profit estimates and gave a weak outlook.

The stock was down nearly 15% around $202 in recent trading, making it the worst-performing stock in the S&P 500 Thursday morning.

The company reported third-quarter earnings per share of $0.55, well below what analysts surveyed by Visible Alpha were looking for. Revenue grew 27% year-over-year to $3.45 billion, ahead of forecasts.

The food delivery giant said orders were up 21% to 766 million, and marketplace gross order value increased 25% to $25 billion. However, costs and expenses jumped 23% to $3.19 billion as the company’s investments in expanding its reach along with new product and initiatives like delivery robots grew.

DoorDash also said it anticipates spending “several hundred million dollars” more in 2026 than 2025, adding “we wish there was a way to grow a baby into an adult without investment, or to see the baby grow into an adult overnight, but we do not believe this is how life or business works.”

Read the full article here.

–Bill McColl

Conversational AI Is Coming to Snapchat. The Company’s Stock Is Soaring Today.

2 hr 6 min ago

Snap shares soared some 12% on Thursday after the owner of the Snapchat social media platform posted better-than-expected results and guidance on user growth and spending.

The company also approved a stock buyback and struck a deal to provide conversational artificial intelligence (AI) search to Snapchat.

The latter bit of news is likely a big reason for the lift in the shares today. Snap (SNAP) said it is partnering with AI-powered answering engine Perplexity to give Snapchat users “a new way to ask questions, explore topics they care about, and learn about the world,” saying Perplexity’s system would be integrated into Snapchat beginning early next year.

Snap said the integration of Perplexity “marks a first step in Snap’s effort to make Snapchat a platform where leading AI companies can connect with its global community in creative and trusted ways.” Perplexity will pay $400 million in a combination of cash and equity over one year, Snap said.

Read the full article here.

–Bill McColl

ESPN Swaps Sports Betting Partners

2 hr 20 min ago

ESPN said sayonara to its sports betting partner early Thursday morning. Soon thereafter, it had another.

The Walt Disney Co. (DIS) unit and PENN Entertainment (PENN) announced that “they have mutually agreed upon the early termination of their exclusive U.S. online sports betting” agreement.

The deal, announced in August 2023, was worth $1.5 billion over 10 years, but each had a right to terminate it “after the third year if specific market share performance thresholds were not met.” They weren’t.

Their ESPN Bet platform could not make much of a dent in the combined market share of sports-betting giants DraftKings (DKNG) and FanDuel, a unit of Flutter Entertainment (FLUT).

“We appreciate the collaboration we had with PENN and are now pursuing other media and marketing opportunities within this space,” ESPN Chairman Jimmy Pitaro said in the press release. About an hour later, ESPN announced its new partner: DraftKings.

Starting Dec. 1, PENN will offer U.S. sports betting under theScore Bet brand, while DraftKings will become “the exclusive Official Sportsbook and Odds Provider of ESPN,” including operating the betting tab on the ESPN app.

“Working with DraftKings, a leader in the space, will allow us to build upon that foundation, continue to super-serve passionate sports fans and grow our ESPN direct-to-consumer business,” Pitaro said in ESPN’s second press release. “We are excited about this new collaboration with DraftKings.”

PENN Entertainment and Disney shares fell roughly 3% and 1.5%, respectively, in recent trading, while those of DraftKings were up 1%.

The Low-Firing Job Market Just Flipped: U.S. Layoffs Hit Highest October Level Since 2003

2 hr 59 min ago

The low-hiring, low-firing job market suddenly has a lot of firing.

U.S. employers announced 153,074 job cuts in October, the most for that month since 2003, consulting firm Challenger, Gray & Christmas said Thursday. That was more than double the 54,064 layoff announcements in September, and up 175% compared to October 2024.

The layoff surge is a red flag about the health of the job market, which has been slowing down by just about any available measure. The most recent data from the Bureau of Labor Statistics showed job growth decreased sharply over the summer as tariffs-related uncertainty, federal workforce cutbacks, President Donald Trump’s crackdown on immigration, and the adoption of artificial intelligence all took their toll.

Reports by companies like Challenger usually take a back seat to official data from the Bureau of Labor Statistics because the BLS data is more comprehensive, based on massive surveys, and is considered the “gold standard” for reliability by economists. But with the government and all its statistical agencies shut down since Oct. 1, investors, business leaders, and officials at the Federal Reserve must rely on alternate data sources to assess the health of the economy.

Read the full article here.

Here’s How Hot Quantum Stocks Have Been Lately—And What to Know About Them

3 hr 33 min ago

Move over, AI.

Quantum computing stocks—those representing a technology that teases vast computing power—have soared in the past year, making even the artificial-intelligence rally look tame. Shares of D-Wave Quantum (QBTS) and Rigetti Computing (RGTI) have soared 2,700% and 3,100%, respectively, over that period. Quantum Computing (QUBT) is up 1,100%. IonQ (IONQ), up 250%, is the laggard of the bunch. 

Only a few of Wall Street’s favorite AI stocks have posted comparable gains in the past 12 months. Software companies Palantir (PLTR) and AppLovin (APP), lauded for their AI-driven growth, have risen roughly 300% in the past year. Nvidia (NVDA), the poster child of the AI boom, has gained about 44%.

Rallies typically slow with age, so it’s understandable that the fresher theme has more momentum behind it—particularly at a time when investors have been willing to lean into speculative concepts and companies. But compare quantum stocks over the past year and AI stocks in the year after ChatGPT was released, and quantum still dramatically outpaces AI: Nvidia shares rose 206% in the 12 months starting Nov. 30, 2022, while server maker Super Micro Computer (SMCI) soared 212%.

Read the full article here.

–Colin Laidley

Elon Musk’s Big Day is Here. Here’s What You Need to Know.

3 hr 46 min ago

The fate of Tesla—or, at least, the answer to the question of whether its chief Elon Musk stays or walks—could rest on today’s shareholder vote.

A preliminary tally on this year’s 14 proposals, which include giving Musk greater control over Tesla (TSLA) as well as a trillion-dollar pay package, is expected after a meeting set to start at 3 p.m. central time. A final count will likely come in a few days, filed to the Securities and Exchange Commission.

Though shareholders have voted with Tesla to approve a past compensation deal for Musk on more than one occasion, the days leading up to today’s shareholder vote have been fraught with tension. The EV-company-with-robotics-and-AI-ambitions has made clear its position that it would be lost without Musk at the helm and that the incentives it recommends are necessary to retain him.

“We believe that Elon’s singular vision is vital to navigating this critical inflection point,” Robyn Denholm and Kethleen Wilson-Thompson, members of the special committee of Tesla’s board of directors wrote in a letter to shareholders.

Counterpoint Global, an investment team within Morgan Stanley Investment Management, as well as the Florida State Board and Schwab Asset Management, have said they intend to cast their votes in favor of Musk’s compensation package.

Read the full article here.

–Crystal Kim

CarMax Stock Sinks as CEO Steps Down, Soft Q3 Projections

4 hr 42 min ago

CarMax’s chief executive is out, its current-quarter projections are weak, and its stock is dropping.

The used-car giant announced before the bell that CEO Bill Nash, a company veteran of more than 30 years, is stepping down, effective Dec. 1, and would be replaced on an interim basis by board member David McCreight.

CarMax (KMX) also provided preliminary fiscal 2026 third-quarter guidance. It sees comparable store used unit sales decreasing 8% to 12% and earnings per share of $0.18 to $0.36, “including $0.09 of non-recurring expenses related primarily to the leadership change announced today and Customer Experience Center workforce reductions.” Visible Alpha consensus is calling for a 2.94% comparable store used unit sales decrease and EPS of $0.70.

The company said the outlook reflects “a decline in retail unit sales; sharp depreciation in the wholesale business; and marketing spend, as noted in the second quarter earnings call, is expected to increase materially year-over-year in the third quarter as CarMax supports its new brand positioning launch.”

CarMax shares, which entered Thursday down 50% this year, are down a further 10% in premarket trading.

Duolingo Stock Crates on Soft Outlook

5 hr 16 min ago

Duolingo (DUOL) shares lost roughly a quarter of their value in premarket trading Thursday, a day after the maker of a popular app to learn foreign languages reported weaker-than-expected current-quarter guidance.

The Pittsburgh-based company sees fourth-quarter bookings of $329.5 million to $335.5 million and adjusted EBITDA of $75.4 million to $78.8 million. Analysts surveyed by Visible Alpha had expected $343.6 million and $80.5 million, respectively.

Duolingo’s Q3 earnings of $5.95 per share and revenue that increased 41% year-over-year to $271.7 million topped estimates. It also reported more than 50 million daily active users for the first time.

Shares of Duolingo entered Thursday down about 20% this year.

Stock Futures Little Changed After Indexes Rebound From Tech Rout

6 hr 16 min ago

Futures contracts connected to the Dow Jones Industrial Average were down less than 0.1%.

S&P 500 futures were up less than 0.1%.

Nasdaq 100 futures also were less than 0.1% higher.