Big Tech Earnings Day | Beyond the Bell

About two minutes away from the end of the trading day, Shonali Bazik and Gina Martin Adams count you down to the closing bell. And here to help us take us beyond the bell with a global simulcast. We’re joined now by Carol Massar and Tim Stenovec, bringing together our Bloomberg Television, Radio and YouTube audiences worldwide to parse through the crucial moments of the trading day. And certainly, it has been quite the day, Carol. Yeah, interesting, right? And we’re definitely well off our worst levels of the session. Having said that, I look at the S&P 500. You still have more than 300 names to the downside. And folks, if you look at some of the ones that are going to be reporting Google, it is down right now just shy of 2%. Microsoft, it is down about 2.4%. So you’re seeing these names as we get ready for earnings trending lower in the tree. Incredible range in today’s trade too. The NASDAQ 100 downed up half a percentage point right now. It was down as much as 2% earlier in the session. Gina, the S&P 500 down more than 1.6% earlier in the session, now down only half a percentage point. Yeah, and a nice climb back. And Tech is not leading the downdraft, which is interesting considering all the nervousness around tech. This really is seems to be related to Meta and a market that was caught off guard by what Meta said regarding their spending and their future growth prospects. It’s definitely weighing on the rest of the communication space, putting a lot of pressure on Google after the close or Alphabet as as the younger folks say. Nonetheless, I do think it’s notable that tech stocks are actually in the green now, the tech sector rising and that’s helping the broader S&P 500 clouds way out of this negative territory. Yeah, it’s interesting and we’ll see what today has to bring as well. Just a lot of uncertainty out there as we wait to see what more of the tech giants have to say. We are getting the bells here now down to the close and we are indeed ending the day again in the red here. We’re looking at the S&P 500 really still down on the day having closed close to 1/2 of 1% lower with even bigger declines here on the Dow Jones Industrial Average, down almost 1%. That NASDAQ 100 now down about 6/10 of 1%, of course snapping that winning streak we saw earlier in the week. All right guys, real quick on some of the movers in today’s session, NVIDIA that stock up about 3.6%. This, this has to do with what we got from meta basically because as they have saying we’re going to do up our spend, our CapEx, we’re doing a lot of things when it comes to AI. So companies that play in the AI space benefited and that included NVIDIA, it was up about 3 1/2% and you also had Super Micro, it was up about 4.3%. Hey folks, we’ve got Microsoft, so let’s get to it. Crossing the Bloomberg Terminal, third quarter revenue 61.9 billion better than what the Street was forecasting, that was a forecast of 60.87 billion. Third quarter EPS, we’re looking at $2.94 a share. Let’s go to cloud revenue. So key for this company, Intelligent Cloud for the quarter 26.71 billion better than the Street forecast of 26.25. Looking at personal computing revenue that to a slight beat 50 point 58 billion versus the estimated 15 point O 7. Productivity revenue pretty much on target 19.57 billion. The street was looking for 19.54, but that third quarter revenue folks coming in better than forecast and you’ve got the stock up almost 5% here in the aftermarket, yeah, expectations were for about $61 billion. We’re seeing it at about $62 billion for the third quarter. Going to the press release, looking at what Satya Nadella, Chairman and CEO of Microsoft has to say about the quarter quote. Microsoft Copilot and Copilot stack are orchestrating a new era of AI transformation driving Better Business outcomes across every role and industry. Shonali Now it’s interesting, we do have Intel also now out. You do have adjusted EPS forecast, missing analyst estimates here. The second quarter revenue is estimated to be 12.5 billion to 13.5 billion and the estimate had been 13.6 billion, a little shy of expectations there even with revenue very narrowly beating estimates here. Intel shares now down more than 2%, fluctuating more than 2.5%, quickening its losses now after market. And what a contrast between the two. You’ve got the software company contrasting with the hardware company. Clearly Microsoft has been just a dominant force in software, investing in all the right places, growing in all the right places. Intel a little bit of a different story and that’s definitely showing up in this quarterly earnings season with not necessarily bad results, but not in across the board, just pummeling of expectations like that which we saw from Microsoft. OK, let’s get on over to Alphabet because we’re seeing the results come right now. It looks like AB when it comes to first quarter revenue, 80.54 billion, beating estimates of a 79 point O $4 billion. First quarter EPS, wow, coming in way above expectations at $1.89 versus estimates of $1.50 three. We’re also seeing first quarter operating income significantly beat expectations, up 25.47 billion versus 22.48 billion. The stock just surging right now up 8%. Well, taking a page from, should I say, whose book Meta’s book, the company, the board approving initiation of a cash dividend, declaring a cash dividend of $0.20 a share. You want to know why the stock is really popping in the after hours. That’s got to help in a big way. Well, it’s interesting. You’re just seeing it soar past 9% after market and Alphabet right now and you are really seeing these results coming out of Alphabet and Microsoft shrugging off a lot of those problems we saw in technology. You got to go there. Yeah, share buyback too. This is something that investors are certainly loving right now. Alphabet authorizing to buy back up to an additional $70 billion in shares, shares Alphabet higher by 9.5%, definitely needed this in the communication space, which was really beholden to what what Meta said with respect to the outlook. This is should turn the tide for communications at large depending on what the other stocks do. But remember this is the 4th largest stock in the S&P 500. This could make a really big difference to the tone of the market. Yeah. As we open up tomorrow I gotta say that Alphabet move man that is just a big one 9 1/2% to the to the upside here. You know initiating A dividend a big buyback. And what’s interesting is talking with our own Mandeep Singh about, you know Alphabet. It’s all about engagement and this is what you want to see at this company. Advertising revenue at Google 61.66 billion that was above St. estimates, U2 at ADS revenue that was above what the street was anticipating. Services revenue coming in. So really cloud revenue. That too was above what the Street was expecting. So you look at all of the businesses across the board, but what’s really key again, this is an engagement company. This is about advertising and that is certainly firing on all cylinders. Yeah, worth reiterating the cash dividend of $0.20 per share. Also the company authorizing that share buyback at up to up to an additional $70 billion worth of shares. I go to the press release and I look to see what Sundar Pichai, CEO of the company says that the results in the first quarter reflect strong performance. Research, YouTube and Cloud, we are well under way with our Gemini era. That’s what investors want to hear about and there’s great momentum across the company. Our leadership in AI research and infrastructure and our global product footprint position as well for the next wave of AI innovation. Remember, investors want to see that the company company search product is keeping up when it comes to AI and competing effectively against everyone else who’s working on integrating AI tech into search AK Meta platforms. Every headline crossing the wire is making investors love this story more. Look at that 12% higher on the day and it’s because not only of that 70% a $70 billion share repurchase reauthorized here, you also have that cash dividend a declared of $0.20 per share. And not only Tim, to your point here, Sundar Pichai, just really highlighting here the Gemini era and momentum across the company, particularly leadership in AI. You do have him really expanding more and their operating results about consolidating their teams as they’ve announced that focus on building AI models. So driving efficiency here while focusing on the future, that’s that’s what’s holding on here to this stock right now. All right, guys. So you’ve got Alphabet up about 12% in the aftermarket. You’ve got Microsoft a gain of about 5 1/2% in the aftermarket made me want to look at the NASDAQ 100 E mini futures and you’ve got that up that index up about just shy of 1%, so providing some upward momentum overall to certainly the NASDAQ trade. OK, let’s go back and take out what shares of Microsoft are doing up 4.5% as we speak. Shares rising after third quarter revenue beats estimate worth repeating these headlines. Third quarter cloud revenue coming in above estimates at $35.1 billion. Estimates are for $33.93 billion, so a beat. They’re also third quarter revenue coming in at $61.9 billion, handily beating those estimates Gina of $60.87 billion. Yeah. And a nice little payout to shareholders as well, more than 8 billion dollars, $8.4 billion to shareholders via dividends and buybacks over the quarter. That I think is a very welcome surprise for investors that are really counting on Microsoft to be a spender but then give a little back, a bit back to shareholders and it certainly adds a bit of juice to the stock price which is soaring in after hours, very different story. So Microsoft soaring, Alphabet is soaring, not the case when you look at Intel, that stock in the aftermarket, we’re looking at about a 5 1/2 almost 6% decline here as we speak. The week forecast exactly, giving a week forecast. You know bigs, maker of personal computer processors, such a big part of their story by giving that lackluster forecast for the current period, it is still struggling to right the ship, turn it around and kind of get back to the top tier of the chip industry having a tough time. All right guys, lots of names, is that enough for you? These are some big names and some big movers. So we’re going to certainly track this at into the after hours and and certainly into the Friday trade. All right, that’s a wrap. Our cross-platform, radio, TV, YouTube, Bloomberg Originals, we will see you again folks. Same time, same place tomorrow.