24hoursworld

How were the balance sheets of three of the main technology companies

How were the balance sheets of three of the main technology companies

Apple CEO Tim Cook said three factors mainly affected the results: a strengthening dollar, production issues in China affecting the iPhone 14 Pro and iPhone 14 Pro Max, and the general macroeconomic environment.

apple.jpg

Finally, and to make clear how meager the technology’s results were, earnings per share totaled USD 1.88, which shows a drop of almost 11% year-on-year. This is explained by the slightly poor performance of the iPhone, which, although it totaled revenues of more than USD 65 billion, this represented a drop of 8% compared to the same period of the previous year.

However, after a first negative reading with falls in what is known as aftermarket operations on Thursday (that is, after the market closes), on Friday the stock rose up to 2%.

Internet tech giant failed to beat market consensus and falls: GOOGLE

Difficult earnings presentation for Alphabet, as it failed to beat market consensus on either revenue or earnings per share (EPS). In addition, Youtube ad revenue was a negative surprise compared to analyst projections (USD7.96 billion vs. USD 8.25 billion estimate). This shows the increased competition that YouTube is having, mainly from TikTok, but also from other forms of short video. For its part, although revenues were more than USD 76,000, this barely reflects growth of 1%, which represents the weakest rise since 2013 (with the exception of the pandemic period).

google.jpg

Finally, the company reported that it will assume a charge of approximately USD 2,000 million, which will mainly impact the first quarter of 2023 as a result of the layoff of employees that it announced in January. At the same time, it expects to incur $500 million in additional costs related to reduced office space in the first quarter, and cautioned that other real estate charges are possible in the future.

All these factors had a negative impact on the price on Friday, falling almost 3%.

The e-commerce giant continues to suffer: Amazon

The e-commerce leader continues to show difficulties in boosting its profit. In a new presentation of the results, in this case, in those corresponding to the last quarter of 2022, Amazon managed to exceed analysts’ expectations in terms of revenue (USD 149.2 billion vs. USD 145.64 billion estimate), but could not make the same in relation to earnings per share (USD 0.03 vs. USD 0.17).

amazon.jpg

This is precisely the point that generated the most concern in the market after the closing of the conference, since although Amazon managed to reflect a year-on-year growth of 9% in net sales (even including some extraordinary expenses), the Net Result continues to slow down. In line with the statement, operating income showed a 23% drop compared to the fourth quarter of 2021, having totaled USD 2.7 billion compared to USD 3.5 billion the previous year.

Finally, it should be noted that the Amazon Web Services (AWS) segment continues to be the most efficient, and in which Amazon at a company level continues to leverage its results. AWS posted net sales of $21,400 (20% year-over-year growth) and managed to maintain operating income, slowing only slightly (-1.9%) compared to Q4 2021.

For this reason, the market read negatively, being the action that most impacted the balance when it fell almost 6% on Friday.

In summary, the large technology companies present balance sheets that, although in all cases show profits, the slowdown in revenues may reflect the negative impact of an economy with lower growth, with the question of how it will continue in the coming months. Given the rise in the days prior to the presentation of the balances, we recommend caution the following days after the publication.

Equity analyst at IOL investoronline

Source: Ambito

Leave a Reply

Your email address will not be published. Required fields are marked *

Latest Posts