Excluding merger costs and other items, E*Trade posted a profit of $7.2 million, or 2 cents per share. The operating results beat Wall Street’s lowered expectations calling for the brokerage to break even with zero cents per share. Analysts have cut their profit forecasts for Web brokers because of a decline in the Nasdaq stock market and an estimated 10 percent drop in share trading volumes during the quarter.
E*Trade opened 337,000 new brokerage and banking accounts in the period, similar to the 340,000 accounts it opened a year-ago and the 330,000 it opened in the fiscal third quarter. The company spent $91.8 million on advertising and marketing in the quarter, up a nominal 5 percent from $87.0 million last year, but sharply lower than the $115 million it spent in the fiscal third quarter.
The company said it processed an average of 150,000 trades per day during the period, up 84 percent from 81,000 in the year-ago period but down from 169,000 last quarter. Total customer assets more than doubled to $66 billion from $28 billion a year ago, helped by E*Trade’s purchase of the brokerage accounts of Wit Capital.
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McDonald’s In Line with Estimates
No. 1 restaurant company McDonald’s said today its third-quarter profit rose 1 percent, meeting expectations, as a weakened euro continued to hurt results.
The global fast-food restaurant chain said its net income rose to $548.5 million, or 41 cents a share, from $540.9 million, or 39 cents, in the year-earlier period.
On average, analysts polled by research firm First Call/Thomson Financial had expected earnings of 41 cents a share.
Sales at the company’s systemwide restaurants, which include company-operated and franchised units, rose to $10.512 billion from $9.998 billion in 1999.
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Sluggish Sales Cost Hasbro Hasbro, the No. 2 U.S. toy maker, reported today that its profits fell 84 percent due to sluggish sales and mounting losses in its interactive operations.
Hasbro said net income fell to $13.8 million, or 8 cents a diluted share, compared with $85.2 million, or 43 cents, for the same quarter a year ago.
Analysts lowered their expectations to 7 cents a share for the quarter, according to market research firm First Call/Thomson Financial. Hasbro warned last week that its performance would fall well short of previous estimates largely because of a sharp slowdown in sales of Pokemon and Star Wars products. It also said it was slashing its work force by about 5 percent.
Worldwide net revenues dropped to $1.07 billion from $1.10 billion in the year-ago period.
“Even with challenging comparisons against last year’s record results, I’m not pleased with our third-quarter performance,” Hasbro Chairman Alan Hassenfeld said in a statement.
Hasbro’s most recent outlook for full-year 2000 earnings per share was 40 cents to 50 cents, before $140 million to $170 million in pretax charges.
Hassenfeld said the company was evaluating the fourth quarter before providing a revenue and earnings outlook for 2001.
Earnings in the third-quarter included a pretax loss of $6 million from Internet games operation Games.com. Its interactive division did not live up to already-reduced expectations, and Hasbro said last week it was exploring strategic alternatives for the business.
Pokemon toy demand in the U.S. was soft, but strong internationally, the company said. Revenues from Star Wars toys are expected to be minimal in 2000.
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U.S. Bancorp Meets Estimates