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Markets Down 4 Straight Sessions: Earnings from AAPL, EXPE, SQ & More
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On the first full day of trading with a Fed funds rate average more than 5% for the first time in over 15 years, we began the day in the red and stayed there through the closing bell, for the fourth-straight down-day in the market indices. The Dow sheathed another -283 points, -0.85% — making it the second of the major indices to trade in negative territory (behind the small-cap Russell 2000) year to date — while the S&P 500 was -0.71%. The tech-heavy Nasdaq outperformed the field (and still up +15% year to date), down only -0.49%, while the Russell came in worst of all, -1.19%.
Further spread of destabilization in West Coast regional banks continues, with PacWest apparently the next domino to fall following First Republic’s collapse earlier this week — or at least that’s what market participants are expressing. PACW has fallen a bracing -50% in today’s session alone, -66% for the past month and -86% year to date. Thus far, the Fed has not treated this regional bank issue as terribly important — if it did, we probably wouldn’t have seen another interest rate hike yesterday.
Meanwhile, after today’s close, we see a full parade of consumer-facing quarterly earnings results — and this is the part of the economy continuing to show resiliency. Don’t take my word for it, though. See with your own eyes:
The world’s largest gadget maker, Apple Inc. (AAPL - Free Report) , recorded beats for both earnings in its fiscal Q2 — $1.52 per share versus $1.44 anticipated — and quarterly sales — $94.84 billion versus $93.32 billion expected. The iPhone alone brought in $51.33 billion for the three months reported, +1.5%, while the Mac and iPad continued to slow down: -31% and -13%, respectively. Services came in more than +5% higher year over year to $20.91 billion, but were still slightly below expectations.
Gross Margins of 44.3% were moderately better than the estimated 44.1%, as demand strength continues forward. Apple sees strength in China and especially India, where the company is reportedly expanding production. The company is also instituting a $90 billion share buyback and a dividend increase of 4% to 24 cents per share. Shares have gained +1.4% on the news in the after-market.
Expedia (EXPE - Free Report) actually missed expectations on both top and bottom lines — negative earnings of -20 cents per share missed the $0.00 expected on $2.67 billion in sales, which was marginally shy of the Zacks consensus $2.69 billion. But the company sees Gross Bookings up +20%, and the company is buying back $600 million in shares, which has helped send EXPE stock +1.5% in late trading.
Expedia-competitor Booking.com (BKNG - Free Report) shares are on an opposing track: the company beat estimates on both top and bottom lines, but shares are down in the after-market: earnings of $11.16 per share were above the $10.62 expected, on $3.78 billion which took out the $3.74 billion consensus. Gross Travel Bookings continued their strong trajectory from Q4, +44% year over year. But shares are giving back around -3% of the +28% growth in the stock, year to date.
DoorDash (DASH - Free Report) shares have been ping-ponging on the news of its Q1 report, posting a better-than-expected loss of -41 cents per share from the -56 projected, on $2.04 billion in revenues which outpaced the $1.92 billion expected, +40% year over year. Gross Order Volume grew +29% year over year, with Total Orders +27% — another company holding onto its strength from the previous quarter. Shares have moved from -7% after the release to +4% at this hour.
Lyft (LYFT - Free Report) is not so lucky at this hour — even on both top- and bottom-line beats in Q1: a positive +$0.07 per share versus an expected -$0.09 on $1.00 billion in sales which surpassed the $976.9 million anticipated, shares are tumbling -13% in late trading. Revenue guidance for Q2 is lighter than initial expected in our Zacks consensus, with adjusted EBITDA guidance notably lower than previously thought.
Coinbase (COIN - Free Report) is seeing a big pop in the after-market: +6% on much-better-than-expected results in Q1: a loss per share of -34 cents is much better than the forecast -$1.44, and $773 million in quarterly revenues easily outpaced the $652.8 million consensus. Cost-cutting and a jump in subscriber revenue assisted Coinbase’s healthy quarter, although the company projects lower subscriber growth for the ongoing quarter.
Finally, Block (SQ - Free Report) — cash payment platform and parent of Cash App, formerly known as Square Inc. — decisively outperformed expectations on both top and bottom lines after today’s close: earnings of 40 cents per share bettered the 31 cents predicted, while revenues of $4.99 billion swept past the $4.58 billion analysts were looking for. Full-year guidance is also improved, as customer engagement remains strong. Shares are +3.5% in late trading at this hour.
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Markets Down 4 Straight Sessions: Earnings from AAPL, EXPE, SQ & More
On the first full day of trading with a Fed funds rate average more than 5% for the first time in over 15 years, we began the day in the red and stayed there through the closing bell, for the fourth-straight down-day in the market indices. The Dow sheathed another -283 points, -0.85% — making it the second of the major indices to trade in negative territory (behind the small-cap Russell 2000) year to date — while the S&P 500 was -0.71%. The tech-heavy Nasdaq outperformed the field (and still up +15% year to date), down only -0.49%, while the Russell came in worst of all, -1.19%.
Further spread of destabilization in West Coast regional banks continues, with PacWest apparently the next domino to fall following First Republic’s collapse earlier this week — or at least that’s what market participants are expressing. PACW has fallen a bracing -50% in today’s session alone, -66% for the past month and -86% year to date. Thus far, the Fed has not treated this regional bank issue as terribly important — if it did, we probably wouldn’t have seen another interest rate hike yesterday.
Meanwhile, after today’s close, we see a full parade of consumer-facing quarterly earnings results — and this is the part of the economy continuing to show resiliency. Don’t take my word for it, though. See with your own eyes:
The world’s largest gadget maker, Apple Inc. (AAPL - Free Report) , recorded beats for both earnings in its fiscal Q2 — $1.52 per share versus $1.44 anticipated — and quarterly sales — $94.84 billion versus $93.32 billion expected. The iPhone alone brought in $51.33 billion for the three months reported, +1.5%, while the Mac and iPad continued to slow down: -31% and -13%, respectively. Services came in more than +5% higher year over year to $20.91 billion, but were still slightly below expectations.
Gross Margins of 44.3% were moderately better than the estimated 44.1%, as demand strength continues forward. Apple sees strength in China and especially India, where the company is reportedly expanding production. The company is also instituting a $90 billion share buyback and a dividend increase of 4% to 24 cents per share. Shares have gained +1.4% on the news in the after-market.
Expedia (EXPE - Free Report) actually missed expectations on both top and bottom lines — negative earnings of -20 cents per share missed the $0.00 expected on $2.67 billion in sales, which was marginally shy of the Zacks consensus $2.69 billion. But the company sees Gross Bookings up +20%, and the company is buying back $600 million in shares, which has helped send EXPE stock +1.5% in late trading.
Expedia-competitor Booking.com (BKNG - Free Report) shares are on an opposing track: the company beat estimates on both top and bottom lines, but shares are down in the after-market: earnings of $11.16 per share were above the $10.62 expected, on $3.78 billion which took out the $3.74 billion consensus. Gross Travel Bookings continued their strong trajectory from Q4, +44% year over year. But shares are giving back around -3% of the +28% growth in the stock, year to date.
DoorDash (DASH - Free Report) shares have been ping-ponging on the news of its Q1 report, posting a better-than-expected loss of -41 cents per share from the -56 projected, on $2.04 billion in revenues which outpaced the $1.92 billion expected, +40% year over year. Gross Order Volume grew +29% year over year, with Total Orders +27% — another company holding onto its strength from the previous quarter. Shares have moved from -7% after the release to +4% at this hour.
Lyft (LYFT - Free Report) is not so lucky at this hour — even on both top- and bottom-line beats in Q1: a positive +$0.07 per share versus an expected -$0.09 on $1.00 billion in sales which surpassed the $976.9 million anticipated, shares are tumbling -13% in late trading. Revenue guidance for Q2 is lighter than initial expected in our Zacks consensus, with adjusted EBITDA guidance notably lower than previously thought.
Coinbase (COIN - Free Report) is seeing a big pop in the after-market: +6% on much-better-than-expected results in Q1: a loss per share of -34 cents is much better than the forecast -$1.44, and $773 million in quarterly revenues easily outpaced the $652.8 million consensus. Cost-cutting and a jump in subscriber revenue assisted Coinbase’s healthy quarter, although the company projects lower subscriber growth for the ongoing quarter.
Finally, Block (SQ - Free Report) — cash payment platform and parent of Cash App, formerly known as Square Inc. — decisively outperformed expectations on both top and bottom lines after today’s close: earnings of 40 cents per share bettered the 31 cents predicted, while revenues of $4.99 billion swept past the $4.58 billion analysts were looking for. Full-year guidance is also improved, as customer engagement remains strong. Shares are +3.5% in late trading at this hour.
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