This round of results ended in a mixed bag for the Big Tech USAwhich in the last quarter have not always met the market’s expectations, in terms of performance or forecasts, ultimately triggering a wave of selling across the entire technology sector, which has been penalized by a predictable sector rotation. In fact, large-cap tech companies have fueled a long rally, repeatedly causing Wall Street to update its all-time highs, which is now taking a break with the scorching climate of August.
Amazon disappoints with forecasts
The accounts of the e-commerce giant Amazon the results were very positive. Revenues grew by 10% to $148 billion versus $134.4 billion a year earlier (+11% at constant exchange rates). Operating profit nearly doubled to $14.7 billion from $7.7 billion in the second quarter of 2023. Net profit stood at 13.5 billionwith diluted EPS of $1.26 per share, up from 65 cents a year earlier.
However, the guidance was not liked for the following quarters. Amazon has in fact anticipated sales will be between 154 and 158.5 billion dollars, up between 8% and 11% compared to the third quarter of 2023, with an unfavorable impact of about 90 basis points from exchange rates. Operating profit is estimated between 11.5 and 15 billion dollars, compared to 11.2 billion dollars in the third quarter of 2023. Forecasts that, in fact, did not satisfy the market, which punished the stock with a 5% drop in the after-hours session.
Apple backed by iPhone
The House of the bitten apple was rewarded by the better-than-expected performance of iPhone sales, which remains the flagship product of Apple with a 46% share of the total turnover. The American giant closed the third fiscal quarter with a turnover up 5% at 85.78 billion, exceeding the consensus of 84.53 billion. The iPhone sales fell by 0.2% to $39.3 billion, but made better than the consensus of 38.81 billion. iPad sales also beat expectations at 7.16 billion versus the 6.61 billion expected, while Mac sales at 7.01 billion are slightly below the consensus (7.02 billion). Services revenues also did well, coming in at 24.21 billion versus the 24.01 billion expected. Thanks to the business trend, Apple recorded a net profit of 21.45 billion, higher than the 19.88 billion dollars, or 1.26 dollars per share, in the same period a year ago.
The forecasts for the next quarter are also positive. Apple expects Services to grow at about the same pace as previous quarters, or about 14%. The company expects operating expenses in the range of $14.2 billion to $14.4 billion in the current quarter and a gross margin of 45.5% to 46.5%.
The future is still tied to artificial intelligence. CEO Tim Cook said that, although Apple cannot yet talk about the positive impact on sales of its Apple Intelligence Service As soon as it was launched, the company increased spending to set up the service and relocated staff to this division.
Intel Testimonial of Chip Crisis
The bad news comes above all with Intelwhich closed the second quarter at a lossdisappointing market expectations, in an effort to produce chips capable of handling artificial intelligence more quickly. Shares of the semiconductor giant fell as much as 20% in the after-hours session, due to the results. Intel also announced the layoffs of more than 15% of its employees (about 17 thousand), the suspension of dividend payments and a 20% reduction in capex.
Revenues decreased by 1% on an annual basis, coming in at $12.83 billion, below the consensus of $12.94 billion. The company then closed the accounts in loss for 1.61 billion of dollars, or 38 cents per shareversus net income of $1.48 billion, or 35 cents per share, in the same period a year earlier.
The outlook for the next quarter is also disappointing. For the fiscal third quarter, Intel forecast an adjusted net loss of 3 cents per share on revenue of $12.5 billion to $13.5 billion. LSEG analysts had expected adjusted net income of 31 cents per share on revenue of $14.35 billion.
