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Luke Kawa12/3/25

GitLab slumps as Q4 guidance underwhelms and management issues erroneous full-year outlook

GitLab is sinking in early trading Wednesday after a management oopsie added to the sting of its third-quarter results, released after the close on Tuesday.

While the software development company exceeded expectations on the top and bottom lines, its Q4 forecast of adjusted net income per share of $0.22 to $0.23 on sales of $251 million to $252 million failed to impress, as the midpoints of these ranges were virtually in line to a touch below Wall Street’s view.

Furthermore, the totality of its guidance didn’t add up: in its first press release, management said adjusted net income per share would come in between $0.95 and $0.96.

Given that Q1 adjusted net income per share came in at $0.17, Q2 was $0.24, and these Q3 results showed $0.25, that implied its Q4 guidance should have been $0.29 to $0.30 to be consistent with the full-year view. Late on Tuesday night, GitLab corrected this error, stating that its full-year view was actually for $0.88 to $0.89 in adjusted net income per share.

That certainly didn’t help improve sentiment on the company, given that the Street was already a little negative on the details of its results and the outlook.

“GitLab’s softening net revenue retention rates and lower overall customer additions highlight execution challenges and reinforce our concerns about AI-driven headwinds to seat growth and the pace of AI feature-led upselling and monetization,” wrote Bloomberg Intelligence senior technology analyst Sunil Rajgopal.

GitLab’s net retention rate slipped to 119% in Q3, below estimates for 119.8%.

The stock is seeing a flurry of pessimism across Wall Street this morning, with Mizuho lowering its price target to $47 from $52, KeyBanc reducing its to $49 from $53, Goldman Sachs cutting to $42 from $48, Wells Fargo trimming to $45 from $50, and Barclays and Truist edging theirs lower to $42 from $44.

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Max Knoblauch2h

United beats Q1 earnings and revenue estimates, lowers full-year profit guidance amid surging jet fuel prices

United Airlines reported its first-quarter earnings results after the bell on Tuesday. The carrier’s shares ticked down in after-hours trading.

For Q1, United reported:

Adjusted earnings of $1.19 per share, compared to the Wall Street estimate of $1.08 per share compiled by FactSet.
$14.6 billion in revenue, compared to the $14.39 billion consensus estimate.

In the first quarter, United’s fuel expense grew 12.6% from the same period last year to $3.04 billion.

For the second quarter, United expects adjusted earnings per share of between $1 and $2, shy of Wall Street expectations of $2.08. For the full year ahead, United said it expects earnings between $7 and $11 per share, compared to its prior guidance of between $12 and $14 per share.

“Guidance assumes United’s revenue recovers 40% to 50% of the fuel price increases in the second quarter, 70% to 80% of the fuel price increases in the third quarter and 85% to 100% of the fuel price increases in the fourth quarter 2026,” read the company’s investor update.

Earlier this month, United was among the first major US airlines to hike its bag fees amid higher fuel costs. Its shares have fallen more than 15% from a February high days before the war in Iran began.

United has also made waves this month following reports that CEO Scott Kirby had floated the idea of a merger with American Airlines to President Trump. A merger between two of the big four airlines would create a true US behemoth, controlling more than a third of the American market. American Air last week said it wasn’t interested in merging with United and hadn’t held talks on the idea. On Tuesday, Trump told CNBC that he doesn’t like the idea either.

Tasha Matsumoto

Stocks slip as peace prospects dim

Stocks swung from positive to negative as Vice President Vance’s trip to Pakistan for Iran peace talks was canceled.

Grizzly bear growling USA.

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Hedge funds are following retail traders into the Magnificent 7

Hedge funds are following retail traders into the stocks the masses never stopped buying.

“As we kick off earnings for megacap tech stocks, this stood out: [hedge funds] have started buying Mag7 stocks again this month though positioning remains well below the peak levels seen in early 2016,” wrote Goldman Sachs’ Cullen Morgan.

Goldman PB Mag 7 — Source: Goldman Sachs

In early April, JPMorgan strategist Arun Jain noted that retail investors had basically been selling everything but the Magnificent 7 stocks as part of a more cautious stance due to the Iran war.

(Apple has been a long-standing exception to this trend, presumably because retail traders aren’t fond of its hands-off approach to AI.)

JPM Retail flows

Last August, Jain discussed how retail activity tended to “crowd in” institutional buyers in meme stocks, while Goldman’s John Marshall advised clients to piggyback on stocks beloved by retail traders. Speculative, retail-geared assets proceeded to go on a tremendous run that soured in October.

But there are some early indications that a similar bout of speculative fervor is bubbling up once more.

markets

POET Technologies surges above $10 for first time in 4 years amid explosion in call volumes

POET Technologies is up nearly 40% this week as options market activity goes haywire in a faint echo of what got the stock on retail traders’ radars in October.

As of 11:12 a.m. ET, more than 10 calls have changed hands for every put traded. This bullish impulse has propelled the stock above the $10 threshold for the first time since March 2022.

Shares of the optical communications firm briefly dipped last week after Wolfpack Research said it was short the company because its investors would be exposed to an “IRS tax nightmare.”

The company responded that day saying it was taking measures for US shareholders that “should mitigate certain potential adverse US federal income tax consequences to it that could otherwise result from the Company’s status as a passive foreign investment company.”

The parabolic surge in Avis reached new heights, with shares halted for volatility

More motivated buyers than motivated sellers.

Travelers at Sacramento International Airport (SMF)

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