What Happened?
Shares of visual content marketplace Getty Images (NYSE: GETY) jumped 3.7% in the afternoon session after the company announced a global, multi-year licensing agreement with the AI-powered search and discovery platform, Perplexity. The deal provided Perplexity with access to Getty's extensive library of high-quality creative and editorial images to enhance its search tools. The images were set to be integrated through Getty's API technology. As part of the agreement, Perplexity also planned to improve how it displays imagery, including adding credits with links to the source, to help educate users on the legal use of licensed content. The market reacted with strong enthusiasm to the news, leading to a massive surge in trading volume. Reports showed that more than 34 million shares changed hands, a significant jump from the average of about 733,000.
After the initial pop the shares cooled down to $2.02, down 0.2% from previous close.
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What Is The Market Telling Us
Getty Images’s shares are extremely volatile and have had 54 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 9 days ago when the stock dropped 2.5% on the news that new trade tensions and disappointing earnings from major tech companies weighed heavily on investor sentiment.
A key driver was the news that the White House is considering new restrictions on Chinese exports that use U.S. software, a move that could significantly impact technology companies. This uncertainty over escalating trade tensions created a broad sense of worry in the market. Simultaneously, shares of the semiconductor giant Texas Instruments dropped 6% after its latest earnings and future revenue forecast both came in weaker than expected, which is a big concern for the health of the tech industry. This poor performance from Texas Instruments immediately dragged down the entire semiconductor sector, causing other major chipmakers like Advanced Micro Devices and Micron Technology to also see significant declines. Compounding the bad news, streaming service Netflix saw its stock slump 9% after it missed its earnings targets, partly blaming a tax dispute in Brazil. The combined effect of renewed trade war fears and the direct evidence of underperformance from influential companies in the technology sector was enough to push the major market indexes lower.
Getty Images is down 4.5% since the beginning of the year, and at $2.02 per share, it is trading 54.3% below its 52-week high of $4.41 from November 2024. Investors who bought $1,000 worth of Getty Images’s shares 5 years ago would now be looking at an investment worth $206.54.
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