The world's largest social network, Facebook (FB), had a rough morning but reversed in the second half of the trading session to finish the day up more than 2% after it announced it is buying mobile-messaging startup WhatsApp for $19 billion in cash and stock. WhatsApp has 450 million monthly users, which is more than Twitter's 240 million users -Twitter is valued at $30 billion. The app allows users to send text, pictures and video to anyone with the software for free. Some investors may see this acquisition as a sign of desperation on Facebook's part to try and regain its popularity with young users which it admits is a demographic that has been declining.
Also reaping the benefits from Facebook buying WhatsApp is BlackBerry (BBRY), whose shares finished the day up more than 3%. The $19 billion acquisition of WhatsApp has investors re-evaluating BlackBerry Messaging, also known as BBM, which still remains popular even though BlackBerry's devices have waned in popularity.
Tesla (TSLA) shares soared, finishing the day up more than 8% after it reported adjusted earnings of 33 cents a share beating estimates by 12 cents. Revenue more than doubled to $615.2 million, still missing estimates of $638 million. Tesla also said it expects a sharp increase in sales of its Model-S sedan in 2014. The company expects to deliver 35,000 cars this year which would be a 55 percent increase from last year, beating analysts' estimates.
Wal-Mart (WMT) saw shares fall almost 2% after it lowering its earnings guidance for the year and for the current quarter, blaming reductions in government benefits, higher taxes and tighter credit. The company forecasted earnings for 2014 to come in at a range of $5.10 to $5.45 per share, versus analysts estimates of $5.54 per share. Wal-Mart forecasted earnings for the current quarter to come in at $1.10 to $1.20 a share while analysts estimates were $1.23 a share. The company posted adjusted profits of $1.34 a share beating estimates by a penny though it was 7-cents below last year's results. Revenue rose 1.5 percent to $129.71 billion but missed estimates of $130.23 billion. Wal-Mart blamed lower profits on a comparable store sales decline of point-4% at U.S. stores -- its biggest unit.