Earnings Snapshot: Baidu (BIDU) Q4 beats top-line and bottom-line estimates. (00:26) OpenAI (MSFT) said to mull special voting rights to block hostile bids. (01:34) Southwest (LUV) expands cost-cutting by announcing 15% reduction in corporate overhead workforce. (02:17)Episode transcripts seekingalpha.com/wsb.Show links: Biggest stock movers Tuesday: INTC, DAL, and moreShort sellers reduce bets against information technology stocks in JanuaryTesla's FSD approval in China could be used for bargaining amid trade tensions - reportSouth Korea plans to secure 10,000 GPUs for AI computing center - reportSign up for our daily newsletter here and for full access to analyst ratings, stock quant scores, dividend grades, subscribe to Seeking Alpha Premium at seekingalpha.com/subscriptions.
Full Episode
Welcome to Seeking Alpha's Wall Street Breakfast, where we cover the top news for investors every morning. Good morning. Today is Tuesday, February 18th. I'm Julie Morgan. Baidu reported earnings today pre-market. OpenAI is reportedly considering special voting rights. And Southwest Airlines is making even more cost cuts.
Baidu reported earnings today ahead of market open, beating top line and bottom line estimates for Q4. Baidu non-gappy pads of $2.63 beats by 78 cents. Revenue of $4.67 billion beats by $70 million.
Ahead of the reporting, shares of Baidu and Hong Kong fell about 7% on Monday after CEO Robin Li was not seen at a meeting between China's President Xi Jinping and top corporate executives, according to Reuters. Shares fell as much as 8.8% before closing down 6.94% in Hong Kong. Baidu lost about $2.4 billion in market value on Monday, according to the report. Shares closed 0.4% higher on Tuesday.
China's president held a meeting in Beijing with the company's top industry tycoons, including Alibaba's founder Jack Ma and the CEO of Huawei. However, there was no sign of Li attending the meetings, the report added, citing two sources. Baidu did not immediately respond to a request for comment from Seeking Alpha.
OpenAI is weighing special voting rights for its nonprofit board to preserve its director's decision-making power. If granted, the special voting rights would allow the nonprofit board to overrule major OpenAI investors like Microsoft and SoftBank. Sources told the Financial Times that the special voting rights are among new governance measures being evaluated
by OpenAI CEO Sam Altman and board members as the company transitions to a for-profit structure. OpenAI last week turned down a $97.4 billion takeover offer by a group led by Elon Musk, who co-founded the company in 2015 but chose to leave in 2018.
After announcing a couple of decisions in January, including reducing pilot headcount at a couple of bases and a pause on hiring, Southwest Airlines on Monday announced slashing about 15% of its corporate jobs, or 1,750 people, in a cost-saving measure. The workforce reduction is focused almost entirely on corporate overhead and leadership positions.
It represents approximately 15% of corporate positions, including senior leadership and directors. 11 senior leadership positions, that's vice president and above. Also representing 15% of the company's senior management committee will be eliminated as part of this restructuring. Separations will be substantially complete by the end of second quarter 2025.
The company estimates partial 2025 savings to be approximately $210 million and full-year 2026 savings to be approximately $300 million. Southwest Airlines paused corporate hiring and suspended most of its summer internships in January. The carrier also reduced pilot positions by 270 at its Denver and Atlanta hubs as part of the carrier's cost-saving and aircraft efficiency efforts.
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