Sphere, Smuckers, Campbell's, Lululemon: Earnings winners, losers

Several companies across the industry reported quarterly earnings this week, including J.M. Smucker (SJM), Sphere Entertainment (SPHR), Campbell Soup Company (CPB), Lovesac (LOVE), Lululemon (LULU), and GitLab (GTLB). Yahoo Finance spoke to CEOs, experts, and analysts to break down everything investors need to know, including the winners and losers from this week's results.

J.M. Smucker (00:00:03):

J.M. Smucker posted better-than-expected results for its fiscal second quarter. J.M. Smucker CEO Mark Smucker broke down the company results. "Our entire portfolio is actually performing exceptionally well," Smucker said. "Recently though we actually took a price decline on coffee because commodity costs have come down, and that takes a little pressure off the consumer."

Sphere Entertainment (00:00:22):

Sphere Entertainment, the owner of the Las Vegas Sphere, posted adjusted income in its first public quarter since the venue opened. Yahoo Finance Entertainment Reporter Alexandra Canal discussed the company expectations. Canal said, "Even though it's only been in operation for a little over two months, its U2 residency has had a lot of success, along with the Darren Aronofsky film 'Postcard From Earth.' Combined those events have brought in more than $75 million for the company so far."

Campbell Soup Company (00:00:55):

Campbell Soup Company beat analyst expectations when it reported fiscal first-quarter adjusted earnings. Campbell Soup CEO Mark Clouse broke down the quarterly results. Clouse said, "We were lapping the best quarter certainly I had since I had been here of a 15 percent growth rate, and it was a monster quarter as it related to soup in particular."

Lovesac (00:01:20):

Lovesac posted a 14.3% year-over-year growth in net sales and 36.3% year-over-year rise in gross profit in the third quarter. Lovesac CEO Shawn Nelson discussed the company outlook. "It's unique for the home category because we're experiencing a big hangover after Covid," Nelson said. "But then again it's unique for Lovesac because we've been on such an uptick as we've built the brand over these past few years very intensely and had a lot of success."

Lululemon (00:01:58):

Lululemon reported third-quarter results that topped Wall Street estimates on both the top and bottom lines, but the fourth quarter revenue guidance was short of expectations. Brian Nagel, Oppenheimer Senior Analyst, broke down future growth potential for the company. "I think you had a pretty nice beat in the third quarter," Nagel said. "They gave specific guidance for Q4, which is slightly below the Street. There's nothing in this support that suggests to me that the underlying business of Lululemon is slowing."

GitLab (00:02:27):

GitLab made a profit in the third quarter and raised guidance. GitLab CEO Sid Sijbrandij discussed the company's stronger-than-expected results. Sijbrandij said, "Every company has to get better at making software. Companies are seeing that they now have like 15 different tools to create software, and they have to hop between each and every one of them to get it out the door. We consolidate that into one platform."

Video highlights:

00:00:03 - J.M. Smucker CEO Mark Smucker

00:00:22 - Yahoo Finance Entertainment Reporter Alexandra Canal

00:00:55 - Campbell Soup CEO Mark Clouse

00:01:20 - Lovesac CEO Shawn Nelson

00:01:58 - Oppenheimer Senior Analyst Brian Nagel

00:02:27 - GitLab CEO Sid Sijbrandij

Video Transcript

MARK SMUCKER: Our entire portfolio is actually performing exceptionally well as we've reshaped it. Recently, though, we actually took a price decline on coffee because commodity costs have come down. And that takes a little pressure off the consumer. And so we're really pleased to be able to pass along a decrease on coffee.

ALEXANDRA CANAL: The Sphere seems to be paying off. Even though it's only been in operation for a little over two months, it's U2 residency has had a lot of success, along with the Darren Aronofsky film "Postcards from Earth." Combined, those events have brought in more than 75 million for the company so far, the bulk of that actually stemming from those film showings, which just shows the potential for this venue beyond your typical concert. In a securities filing, the company said it expects its Sphere segment to report positive adjusted operating income for the current quarter.

MARK CLOUSE: One of the things I reminded people today quite a bit about was the fact that we were lapping the best quarter certainly I had had since I've been here of a 15% growth rate. And it was a monster quarter as it related to soup in particular. So the fact that we were down 1% on sales after cycling 15 growth and a 2-year run rate of 7 puts it in a little bit of different context.

SHAWN NELSON: I learned this back in 2008, 9, 10. Still in the home furnishings business even way back then. Lovesac grew and grew through that recession because while business curtailed 10, 20%, let's say, generally, the other 80% still marches on. And I think that's in a way what's happening now. It's unique for the home category because we're experiencing a big hangover after COVID. But then again, it's unique for Lovesac because we've been on such an uptick as we've built the brand over these past few years very intensely and had a lot of success.

BRIAN NAGEL: I think you had a pretty nice beat in the third quarter, more on the bottom line than the top line, but really a beat. The gross margins were a lot higher than expected. So that was a positive. They did lift modestly guidance for the balance for '20, for the whole year. So in that, they gave specific guidance for Q4, which is slightly below the Street. There's nothing in this report suggests to me that the underlying business of Lululemon is slowing.

SID SIJBRANDIJ: The demand is being driven by software eating the world. Every company has to get better at making software. Companies are seeing is that they now have like 15 different tools to create software. And they have to hop between each and every one of them to get it out the door. We consolidate that onto one platform. They don't have the integration costs. And they get typically seven times faster in making a change. We told the Street that for coming fiscal year, we expect to be non-GAAP operating income profitable.