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Net Net: Promoting innovation and managing change

Last Call: Electronic Arts, Star Wars and a Disturbance in the Force

Darth Vader
Source: Lucasfilm

“I find your lack of faith disturbing.”

-Darth Vader

-Below, EA beats expectations but shares still head south, in part based on concerns over the future of the Star Wars franchise.

Market Musings

Dow Jones Industrial Average, down 29.74 points, or 0.23%, to 13,008.53: Down for four consecutive trading days and five of the last six sessions.  Down 270.79 points, or 2.04%, over the last four trading days. Month-to-date it is down 1.55%. Year-to-date it is up 6.47%.

NASDAQ Composite, up 1.42 points, or 0.05%(rounded), to 2,957.76: First gain in three days. Month-to-date it is down 2.91%. Year-to-date it is up 13.54%.

S&P 500, up 0.48 points, or 0.04%, to 1,369.58: Snaps a three day losing streak. Off 12.50% from its record closing high of 1,565.15, hit on Tuesday, October 09, 2007.  Month-to-date it is down 2.03%. Year-to-date it is up 8.90%.

What Wall Street Is Saying Tonight

YAHOO CEO APOLOGIZES TO EMPLOYEES IN EMAIL/WSJ – Amir Efrati: "Mr. Thompson apologizes to employees and says he regrets the disruption the situation has caused, but he stops short of revealing why Yahoo incorrectly disclosed his college degree."

/ Reuters with "Electronic Arts reported quarterly earnings that beat analysts' expectations, but shares plunged more than 8 percent after-hours as the company's full-year revenue outlook fell short. ... The drop in revenue came as EA lost 400,000 subscribers of "Star Wars: The Old Republic" in the quarter, putting the new game's future growth in question."

CONSUMER BORROWING ROSE 10.2% IN MARCH/WSJ - Josh Mitchell: "Americans are stepping up their borrowing, possibly a good sign for the economy as households become less determined to whittle debt and more willing to spend. Consumer borrowing on credit cards, car loans, student loans and other types of installment debt grew at a seasonally adjusted 10.2% annual rate to $2.54 trillion in March from February, the Federal Reserve said Monday. Mortgages aren't included in the tally.  March's climb was the biggest monthly leap since November 2001, when zero-percent financing on car loans touched off a surge in borrowing after the September 11 terror attacks."

WYNN RESORTS' NET SLIPS AS VEGAS REVENUE FALLS/WSJ - Drew Fitzgerald: "Wynn Resorts' first-quarter profit fell 19% after the casino operator kept a smaller cut of revenue from its table games in Las Vegas. Revenue from Las Vegas declined 8.1%, while revenue from Wynn's Macau operations increased 9.8%."

MIXED DECISION IN GOOGLE-ORACLE COPYRIGHT CASE/NY Times – Quentin Hardy & Nicole Perlroth: "In a split decision that all but guaranteed continuing litigation, a Federal District Court jury in San Francisco on Monday decided that Google infringed on the overall structure of software copyrights held by Oracle , but also said that Google had not violated other important parts of Oracle’s software known as Java.

The limited decision means Google will not have to redesign its Android operating system — which would have slowed the march of Android-powered phones that have steadily gained market share against Apple’s iPhone."

DIAMOND FOODS RECRUITS FORMER HOSTESS BRANDS CEO/WSJ – Nathalie Tadena: “ Diamond Foods named former Hostess Brands chief Brian J. Driscoll as its new president and chief executive, three months after the snack-food company ousted its former chief executive and chief financial officer amid an internal accounting probe. Director Rick G. Wolford had served as interim chief executive since February while the company conducted a search for a permanent CEO. Mr. Driscoll, 53 years old, served as Hostess Brands CEO from June 2010 until March. He has also held positions at Kraft Foods , Nabisco, Nestle and Procter & Gamble ."

NEVADA ISSUES GOOGLE FIRST LICENSE FOR SELF-DRIVING CAR/LV Sun – Cy Ryan: “Nevadans will soon see driverless cars being tested on streets and highways. Google received the first license Monday from the state Department of Motor Vehicles to test the autonomous vehicles. It is believed to be the first such license issued in the country. The 2011 Legislature passed the first law in the nation to permit testing of driverless cars. But state regulations require a person behind the wheel and one in the passenger’s seat during tests.”

Tomorrow's Earnings

Before the bell:

Charter Comm., DirecTV, Discovery Comm., HSBC, Liberty Media Interactive

After the bell:


Tomorrow's Economic Data

730      Apr      NFIB                       

1000    Mar      JOLTS                   

1300               3-Yr Note Auction  

Tomorrow on CNBC

6:20am ET  Jonathan Baum, BNY Mellon Dreyfus, CEO

7:00am ET  Arthur Brooks, AEI, President

8:40am ET  Bill Bradley, Allen & Company, Managing Director, Fmr. US Senator (D-NJ), Former Presidential Candidate

10:40am ET John Partridge, Visa, President 

4:10pm ET   Robert "Bob" Iger, Another *First* on CNBC, The Walt Disney Company, President & CEO

Follow Tom Rotunno on Twitter: @tomrotunno

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