Tech Companies a Mixed Bag During Thursday Earnings
- Amazon misses
- Twitter plunges
- Verizon beats estimates
- Intel has earnings beat
During the earnings announcements on Thursday, we had a whole host of several technology-based companies in the United States report. There was a complete mixed bag coming out of those announcements, as technology seems to be all over the place. This will have its influence on the NASDAQ and others, but it is clearly a sign of just how mixed the US economy is at the moment.
Amazon announced that its third-quarter earnings fell short of Wall Street expectations, driving it down as much as 9% in after-hours trading. The company has missed earnings estimates, due in part to spending billions of dollars to expand its free one-day delivery service.
It gave fourth-quarter revenue guidance in a range between $80 billion and $86.5 billion. This fell below the estimated $87.4 billion by Wall Street. This suggests that, perhaps, the holiday season may be a little less stringent than initially thought.
Twitter reported a third quarter that was hampered by several different product issues, and what they called significant headwinds in the advertising sector. There were several blogs that weighed upon revenue during the quarter and led to a miss on both top- and bottom-line figures. It also warned shareholders that headwinds could continue through the rest of the year and into 2020. However, the company did say it is going to increase its capital investment into the platform.
What is particularly striking is that Twitter shares dropped 20.8% on Thursday after the announcement. Earnings-per-share were $0.17 versus the expected $0.20, with revenue coming in at 823.7 million against the $874 million that was expected.
Intel beat expectations on both top- and bottom-line figures, and guidance is also stronger than anticipated. The company’s revenue has increased slightly year-over-year, with the stock jumping 8% in after-hours trading on Thursday. Earnings were $1.42 per share versus the expected $1.24 per share. Revenue came in at $19.19 billion, as opposed to the $18.05 billion expected by analysts on Wall Street.
Verizon had a strong earnings call, beating estimates for third-quarter profit and revenue. The company added 615,000 postpaid customers, well above the analyst estimates of 527,000 subscribers.
Net income rose to $5.34 billion, or $1.25 per share, in the third quarter. A year earlier, these same figures were $5.06 billion and $1.19 per share, showing signs of growth and strength in the company. Total operating revenue rose 1% to $82.89 billion, beating the $32.75 billion expected by Wall Street.
Mixed results, mixed economy
The one thing that can be taken away from these four giant earnings announcements is that the US economy is mixed and not moving at one speed. That being said, this explains a lot of the stock market movement that we have seen lately. We should probably expect more of the choppy and indecisive trading sessions that have plagued the market for the last several weeks.