Marvell's Lumentum deal, and Apple's margin

Easy version of the November 3 U.S. stock note. This is not investment advice. Later names were left out.

In one line, Marvell said it would buy Lumentum for $115 billion in stock, and the stock crashed. Apple beat forecasts, but a weak margin outlook weighed on the shares. Margin is the share of revenue left after costs.

Apple fell ▼ 1.74% to $338.64. After the close, in CEO John Ternus's first report, fiscal fourth-quarter earnings per share were $2.10 and revenue was $114.48 billion, above forecasts of $1.99 and $113.39 billion. iPad sales missed. Gross margin fell from ▼ 50.1% to 47.9% on higher part costs, and the holiday-quarter margin outlook disappointed. The stock stayed weak after hours. After-hours means trading after the regular close.

Palantir fell ▼ 3.10% to $178.40 before its report. After the close, third-quarter revenue was $2.31 billion, up 96%, and adjusted earnings per share were $0.44, above forecasts of $2.18 billion and $0.41. U.S. commercial revenue of $984 million, up ▲ 148%, passed U.S. government revenue of $953 million for the first time. Yearly revenue guidance rose to about $8.53 billion. The regular-session drop came before that report.

Marvell fell ▼ 12.78% to $171.30. It said it would buy optical-parts company Lumentum for $115 billion, all in stock. Lumentum holders would get 4.5 Marvell shares per share. After the deal, existing Marvell holders would own about 67%. That is dilution, a smaller share of the company. The company expects more than $1 billion a year in cost savings. A preliminary fiscal third-quarter revenue figure matched the midpoint of old guidance. Closing is planned for the first half of 2028, so the deal is not finished.

Lumentum fell ▼ 18.66% to $683.83. Fiscal first-quarter adjusted earnings per share of $4.57 beat a forecast of about $4.20, and revenue of $1.26 billion rose 136.5%. Second-quarter revenue guidance of $1.575 billion to $1.625 billion was about $350 million above the prior quarter. Because the exchange ratio is fixed, Marvell's drop cut the deal value and Lumentum fell with it.

Oracle fell ▼ 8.83% to $119.13. It filed to sell $10 billion of common stock and $10 billion of senior bonds to fund AI equipment. At the prior Friday's close, the stock piece was about 76.5 million shares, about 2.5% dilution. S&P had cut the rating in July to BBB-, just above junk, so funding worry returned.

Bloom Energy fell ▼ 3.46% to $196.14, and the one-month drop was more than 30%. After the close it announced a memorandum, not a binding final contract, with California Resources and a carbon unit for more than 1 gigawatt of fuel-cell power and carbon capture. The stock bounced after hours. It was not said that the memorandum became a real order.

Three lines to keep. A large deal paid in new shares can still send the buyer's stock down. Apple's sales were fine, but the margin outlook set the price. Oracle raised AI-equipment money with both stock and debt.

Left out: names after Rivian. The Marvell deal is planned, not closed.