Stock futures edge lower
U.S. stock futures plunged early Tuesday, a day after the Dow Jones Industrial Average gained more than 610 points.
As of 5:30 a.m. ET, futures tied to the Dow dipped 321 points, or 1.01% to 31,518. S&P 500 futures dropped 57 points, or 1.44% to 3,914.75 while the tech-heavy Nasdaq 100 futures gave away 246 points, or 2.04% to 11,789.25.
A slew of companies are slated to report their quarterly results today, including Best Buy (BBY), AutoZone (AZO), Abercrombie & Fitch (ANF), Urban Outfitters (URBN), Intuit (INTU), and Nordstrom (JWN).
Federal Reserve Chair Jerome Powell is also scheduled to speak at 12:20 p.m. ET today. The Fed will release minutes from its latest two-day policy meeting on Wednesday.
Snap shares plunge 28% after profit warning
Shares in Snapchat parent Snap (SNAP) were under pressure in Tuesday’s premarket trading session after the company warned it could fall short of its targets for adjusted profit and revenue in the second quarter.
In a filing on Monday, the messaging app told shareholders it is likely to “report revenue and adjusted EBITDA below the low end of our Q2 2022 guidance range,” due to macroeconomic conditions.
According to a Wall Street Journal report, Snap also told employees that it will slow the pace of hiring and explore more ways to cuts costs in the remainder of its 2022 budget.
In April, the company had said it expected Q2 revenue would increase by 20% to 25% from $982 million a year earlier. It had also guided for adjusted EBITDA of between $0 and $50 million.
Snap stock plummeted 28.44% to $16.08 a share in the premarket trading session.
Broadcom reportedly discussing paying $60 billion for VMware
Meanwhile, a new report published by the Wall Street Journal says Broadcom (AVGO) is discussing paying around $140/share for VMware (VMW).
The deal would value VMware at about $60 billion and represents a 46% premium to closing price of VMware shares on Friday.
Broadcom and VMware could announce the deal when the latter reports its first-quarter results on Thursday, according to the Journal, which cited people familiar with the matter.
The people told the Journal that Broadcom plans to use a “handful” of banks to secure a $40 billion debt package to help finance the deal.
Broadcom primarily designs networking and storage chips. The acquisition of VMware is likely to give it a bigger presence in cloud computing.