Connect with us

BenzingaEditorial

Besides Alphabet, Big Tech Failed to Impress

Published

on

Investors are busy digesting Big Tech earnings as tech stocks suffered a big sell-off after earnings failed to impress Wall Street last week on the busiest day of the reporting season. Facebook (NASDAQ: FB), Apple (NASDAQ: AAPL), Twitter (NYSE: TWTR), Amazon (NASDAQ: AMZN) and Alphabet (NASDAQ: GOOG) reported earnings last Thursday to a tough crowd as Wall Street was already getting fidgety about the presidential election. Shares of Facebook, Apple and Amazon all fell roughly 6% in Friday trading, with Twitter dropping more than 20% hit. Only Alphabet managed to deliver a positive surprise with its shares up 4% in afternoon trading.

Facebook: surprising strength despite challenges

The surprise for Facebook was the July boycott that did not have as detrimental impact as initially thought, as far as advertisers are concerned, considering most of them already came back. But Facebook’s shares closed down more than 6% on the day because it spooked investors with a decrease in users in the U.S. and Canada. This user base dropped from 198 million in the prior quarter to 196 million daily active as lockdown measures eased. As for the outlook, Facebook expects this user base to remain flat or even decrease further in the fourth quarter. Globally, the social media giant was benefiting from higher usage per day as global lock-downs substituted screen time for in-person social time, but this is no longer the case and it did not manage to achieve the success of Snap Inc (NYSE: SNAP) whose price soared more than 22% on the day it posted an unexpected, adjusted profit along with positive user and revenue growth in its third-quarter earnings. With 249 million daily active users, Snapchat’s user base has expanded almost 4% from the 238 million within three months.

Apple: subtle confidence

Investors were disappointed with Apple’s lack of forward guidance. On the other hand, Apple hasn’t given guidance since the pandemic started, so, this is consistent with what they’ve already been doing, but it still caused its shares to drop more than 5.5%. Apple did manage to slightly exceed Wall Street expectations but didn’t offer fourth-quarter guidance, along with reporting a 20% decline in iPhone sales on a YoY basis. The decline was due to two factors: a one month delay of the launch and that fact that new iPhone 12 sales didn’t form part of the quarter in question. Wall Street is more focused on how the iPhone 12 will sell in the coming year and Tim Cook did show a subtle sign of confidence.

Twitter: disappointing user growth

Twitter stock plunged and closed down more than 21% on Friday after it reported disappointing user growth during the third quarter. But, it did manage to beat analysts’ expectations on profit and revenue. From its previous quarter, Twitter grew its total monetizable daily active users by just 1 million people. With 187 million users, it was well below analyst expectations of 195 million mDAUs. Its prior growth was in large part attributed to lockdowns across the globe.

Amazon earnings: execution challenges

The fourth quarter is going to be incredibly challenging for Amazon, just like the whole year. It has a challenging task to maximize revenue while solving challenges at their fulfillment centers to get products in and out as quickly as possible. Amazon has remained loyal to its “Day One” policy despite dominating various industries ranging from e-commerce to cloud computing.

It kicked off the holiday season with its Prime Day in October, hoping it will improve their yield at the fulfillment center level and help them maximize sales in the holiday quarter. But, a big challenge is ahead.

Despite a 37% revenue growth to $96.1 billion and a near doubling in operating income grabbed most of the attention, Amazon stock closed down nearly 5.5% after the company gave a wide guidance range for the fourth quarter with sales expected in the range between $112 billion to $121 billion, about 28% to 38% growth from a year earlier. Analysts were expecting revenue of $112.3 billion but they still expect Amazon can go far and continue to grow.

Alphabet crushed estimates

Google has one of the biggest cash hoards ever, but it comes with a lot of exposure to the travel business, one that no one wants to in right now. But, the world can no longer be imagined without Google. Or YouTube, whose ad growth was particularly strong, up 32% from a year ago. Alphabet overall has an extraordinary business and there’s a lot to like about it as it keeps evolving. It managed to beat Wall Street’s revenue expectations across each major section during the third quarter.

As Alphabet blew away both earnings and revenue estimates, its stock rose as much as 9% in after-hours trading. Its earnings figures showed its core advertising business has nicely recovered after being hit hard with pandemic-induced cuts in ad spending.  Executives also announced that as of next quarter, the company will break out operating income from Google Cloud. Alphabet showed a textbook example of a rebound.

Outlook

Shares of Twitter, Facebook, Apple and Amazon sank on Friday as their latest quarterly reports failed to delight investors. But shares of Alphabet, which crushed expectations and alleviated advertising crunch fears, closed up. Alphabet’s success follows similarly strong earnings reports by ad-driven online companies such as Pinterest (NYSE: PINS) and Snap (NYSE: SNAP).

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure . IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

BenzingaEditorial

Coca Cola Confirms Its World’s Beloved Brand Status

Published

on

For more than a century, The Coca-Cola Company (NYSE: KO) has been “refreshing the world in mind, body, and spirit”. The company aims to inspire moments of optimism, to create value and make a difference.

On Wednesday, the beverage giant revealed second-quarter earnings and revenue that beat Wall Street’s expectations, allowing it to raise its full year forecast for adjusted earnings per share and organic revenue growth. Most importantly, some markets rebounded from the pandemic, fueling revenue to surpass 2019 levels. Shares rose more than 2% in morning trading.

Q2 figures

Net income rose from $1.78 billion as it amounted to $2.64 billion. It resulted in adjusted earnings per share of 68 cents, exceeding the expected 56 cents. Net sales rose 42% with revenue of $10.13 billion that also exceeded the expected $9.32 billion. Excluding acquisitions and foreign currency, organic revenue rose 37% compared to last year’s biggest plunge in quarterly revenue in at least three decades due to lockdowns that severely dented demand.

A significant increase in marketing and advertising spend fueled the rebound but Coca Cola’s approach isn’t just about boosting spend, but also about increasing the efficiency of that spend. CFO John Murphy revealed that marketing dollars were doubled compared to last year’s quarter, when the pandemic forced the beverage giant to slash its costs to preserve cash.

Unit performance

All drink segments reported double-digit volume growth. Away-from-home channels, like restaurants and movie theaters, were rebounding in some markets, like China and Nigeria, but there are also markets that are still being heavily pressured by the pandemic such as India.

The department that contains its flagship soda saw volume increase by 14% in the quarter. The nutrition, juice, dairy and plant-based beverage business saw a volume growth of 25%, partly fueled by Minute Maid and Fairlife milk sales in North America. The same volume growth was seen by hydration, sports, coffee and tea segment. Costa cafes in the United Kingdom reopened and drove 78% increase in volume for coffee alone.

The risk of raising commodity prices

Like its F&B peers, Coke is facing higher commodity prices but it plans to raise prices and use productivity levers to manage the volatility in the second half of the year.

Outlook

For the full year, Coke improved its organic revenue growth outlook from high-single digit growth to a range of 12% to 14%. It also raised its forecast for adjusted earnings per share growth from high single digits to a low double digits range of 13% to 15%.

Putting it all together, executives emphasized the range of possible outcomes given the asynchronous recovery and dynamic of the pandemic. Coca Cola plans to build on the strong momentum by intensifying the amount and efficacy of promotions and continuing to innovate, what it does better than anyone and what helped it earn its brand status.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

Continue Reading

BenzingaEditorial

Automakers Are Hitting the Accelerator in the EV Race

Published

on

On Thursday, Daimler AG (OTC: DDAIF) has officially hit the accelerator in the e-car race with Tesla (NASDAQ: TSLA), revealing it will invest more than 40 billion euros in EVs by 2030. From 2025, three new vehicle platforms will only make battery-powered vehicles. One will cover passenger cars and SUVs, one will be devoted to vans and last but not least, the third will be home to high-performance vehicles that will be launched in 2025. Under its EV strategy, the inventor of the modern motor car will be renamed Mercedes-Benz as it spins off its trucks division by the end of the year. With its partners, it will build eight battery plants to ramp up EV production.

Upon the news that come just over a week after the EU proposed an effective ban on the sale of new petrol and diesel cars from 2035, shares rose 2.5%.

Automotive peers

Ahead of the EU’s announcement that is only part of a broad strategy to combat global warming, many automakers announced major investments in EVs. Earlier this month, Stellantis (NYSE: STLA) revealed its own EV strategy that includes investing more than 30 billion euros by 2025. Mercedes Benz isn’t the only one ‘going for it’ to be dominantly, if not all electric, by the end of the decade. Geely Automobile Holdings Limited’s (OTC: GELYF) Volvo Cars committed to going all electric by 2030, while General Motors Co (NYSE: GM) is aiming to be fully electric by 2035 and Volkswagen AG (OTC: VWAGY) even plans to build half a dozen battery cell plants in Europe.

Moving the debate

Daimler’s chief executive stated that  spending on ICE-related technology will be “close to zero” by 2025 but he did not specify when it will end the sales of fossil fuel-powered cars. Källenius wants to move the debate away from when will the last combustion engine be built to how quickly they can scale up to being close to 100% electric.

Tough decisions for Mercedes Benz

The undergoing shift will result in an 80% drop in investments in ICE vehicles between 2019 and 2026. This will have a direct impact on jobs because EVs have fewer components and so require fewer workers compared to their ICE counterparts. As of 2025, Daimler expects EVs and hybrids will make up half of its sales, with all-electric cars expected to account for most that figure, which is earlier than its previous forecast for 2030.

The battery- the Holly Grail

By 2023, Daimler plans to have a fully operational battery recycling plant in Germany. The industry leader Tesla just signed a deal with the world’s largest nickel miner to secure its battery resources as it prepares to begin its own tables battery in-house. Then there’s Worksport (OTC: WKSP) who will bring solar power to the EV table with its solar fusion TerraVis which will be fine-tuned and validated for prelaunch by the end of 2021. Although the first prototype is a solar-powered tonneau cover for pickup truck drivers, the company is also developing TerraVis COR which is a standalone product that offers remote power generation and storage. In other words, with its two-year partnership with Ontario Tech University, Worksport is fully equipped to power many automakers step into the electrification era.

The EV race is a journey like no other we have witnessed – and the participants are going full-speed ahead as they race to reshape the energy matrix of automotive industry.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

Continue Reading

BenzingaEditorial

Intel’s Q2 Results Show It Is Not Losing Focus

Published

on

Intel Corporation (NASDAQ: INTC) revealed its second-quarter 2021 financial results yesterday. The digitization transformation and switching to cloud services continue to accelerate, and a company like Intel sees that as the opportunity for an even bigger growth. Even with the current semiconductor shortage, Intel is not losing its focus on both innovations and the implementation of new solutions. The company’s CEO, Pat Gelsinger, appointed earlier in 2021, believes we are at the beginning of the semiconductor industry’s decade of sustained growth and that Intel has a unique position to capitalize on that trend. As the momentum is strengthening, execution is increasing, the company’s products are being chosen for top and flagship products. We can also see good results in other companies in the semiconductor business, like Texas Instruments Incorporated (NASDAQ: TXN) and Advanced Micro Devices, Inc. (NASDAQ: AMD).

 Second-quarter results

Intel’s second-quarter results are positive and the proof of the momentum building up, as mentioned by Gelsinger. GAAP revenues for Q2 were $19.6 billion, significantly higher than the expected $17.8 billion, and there was no change when looking back year over year. However, non-GAAP revenues were $18.5 billion, exceeding the April guidance by $700 million, and that is 2% up compared to the previous year. Intel’s Data Center Group (DCG) generated $6.5 billion compared to the expected $5.9 billion. Client computing generated the expected revenues of 9.95 billion, while the actual revenues were $10.1 billion. GAAP earnings per share were $1.24, while the non-GAAP EPS were $1.28, which also surpassed April’s guidance of $1.07.

 The good trend in the semiconductor industry

Another chipmaker, Dallas-based Texas Instruments, also reported Q2 earnings that topped the expectations. These good results were due to revenues growth and an increase in profits. The analysts expected revenues of $4.36 billion, and the company managed to generate $4.58 billion. That is a sales increase of 41% when looking year over year. Expected earnings per share were $2.05, while the analysts expected $1.83. However, the sales guidance for the current quarter was below the investors’ wishes, so the share price dropped upon the news.

 Outlook

As revenue, EPS, and gross margin exceeded the Q2 guidance, Intel raised its 2021 full-year guidance. So expected GAAP revenues are $77.6 billion and non-GAAP revenues are expected to amount to $73.5 billion (which is an increase of $1 billion), resulting in expected GAAP EPS of $4.09 and non-GAAP EPS of $4.80. Planned CAPEX is between $19 billion and $20 billion and free cash flow should be $11 billion, which is an increase of $500 million versus prior expectations. Gelsinger estimates that the semiconductor shortage will start loosening in the second half of the year, but it will take another one to two years until the demand is completely met.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

Continue Reading
Advertisement

TRENDING

Advertisement

Submit an Article

Send us your details and the subject of your article and an IAM editor will be in touch with you shortly

Trending