Dexcom, CNXN, and Robinhood rally on earnings, while Amazon and Meta warn of tariff fallout; Buffett to retire, Abel named successor.
Sectors & Industries
May 5, 2025
Table of Contents
Dexcom (DXCM) surged 17% after reporting solid Q1 2025 financials and announcing a $750 million share repurchase program. The glucose monitoring leader cited confidence in long-term growth and profitability, with the buyback viewed as a strategic capital deployment to enhance shareholder value.
Kohl’s (KSS) jumped 7.61% following the abrupt termination of CEO Tom Kingsbury for cause, citing conflicts of interest. The leadership shake-up renewed investor hopes for a strategic pivot or operational overhaul as the company navigates a challenged retail environment.
PC Connection, Inc. (CNXN) rallied 7% after its board approved a $50 million increase to its existing share repurchase plan, boosting total authorization to $170 million. With $50.5 million still available, the move underscores management’s focus on capital return and confidence in ongoing performance.
Warren Buffett announced he will step down as CEO of Berkshire Hathaway at the end of 2025, bringing to a close his six-decade run as one of the most influential figures in investing. Vice Chairman Greg Abel, who already oversees the company’s non-insurance operations, will officially take over. While Buffett will remain involved in select matters, he emphasized that decision-making power will fully shift to Abel.
Berkshire reported a 14% drop in Q1 operating earnings to $9.6 billion, weighed down by insurance losses tied to wildfires. However, the company’s cash reserves grew to a record $347.7 billion. The firm also continued to sell more stocks than it bought, trimming positions like Apple while boosting liquidity.
Buffett used the meeting to warn about rising federal deficits and currency risks, calling the current fiscal path “unsustainable.” He also noted uncertainty tied to tariffs, which could affect several of Berkshire’s operating companies.
Amazon topped Q1 estimates with EPS of $1.59 (vs. $0.98 YoY) on revenue of $155.7B (+8.6% YoY), but shares dipped after the company guided below expectations for Q2 operating income ($13B–$17.5B vs. $17.8B consensus). AWS grew 16.9% to $29.3B but showed continued deceleration amid cloud competition and capacity constraints.
Tariffs emerged as a key risk, with Trump’s new 145% China duties and 10% blanket tariffs threatening Amazon’s e-commerce model. Over half of Amazon’s sellers are China-linked, and many are stockpiling goods in the U.S. to delay tariff pain. CEO Andy Jassy acknowledged this as a temporary solution, warning price hikes or margin compression may follow as inventories deplete.
The tariff pressure is compounded by the expiration of the de minimis exemption, affecting direct imports under $800. Amazon has denied claims it would display tariff costs on-site, but a dust-up with the White House underscored its delicate position. Despite steady demand, third-party seller growth slowed to 7%, and analysts expect sharper pain in Q3–Q4 if trade policy remains volatile.
Meta kicked off 2025 with a blowout Q1: EPS came in at $6.43 vs. $5.28 expected, and revenue rose 16% YoY to $42.31B, beating consensus by nearly $1B. Net income surged 35% to $16.64B as the company’s AI-powered ad tools drove stronger engagement and conversion across Facebook, Instagram, and Threads.
Despite the beat, Q2 guidance of $42.5B–$45.5B came in line, with CFO Susan Li warning of reduced ad spend from Asia-based e-commerce exporters ahead of the de minimis loophole closure and ongoing U.S.-China trade tensions. Li said some of this ad budget has already shifted to other markets, but total spend remains below pre-April levels.
Meta raised 2025 capex to $64B–$72B (up from $60B–$65B) to fund AI infrastructure and offset global supply chain cost pressures. Management also flagged regulatory risks in Europe, where new restrictions could degrade user experience and dent revenue by Q3 if not resolved.
AI continued to power Meta’s growth story: the company now boasts 3.43B daily users, nearly 1B Meta AI users, and 350M Threads MAUs. Meta AI is expected to become a new monetization layer, though the company will hold off on aggressive monetization until the product matures.
Robinhood posted strong Q1 2025 results, with revenue up 50% YoY to $927 million, driven by a 77% surge in transaction-based revenue. Crypto revenue more than doubled to $252 million, and net income jumped 114% to $336 million, with EPS rising to $0.37. Platform assets soared 70% to $221 billion, and ARPU rose 39% to $145. Funded accounts hit 25.8 million, with Gold subscriptions up 90% to 3.2 million.
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