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Tech Majors Report Earnings After the Bell: MSFT, FB, TSLA & More

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Shares of Facebook are racing ahead in Wednesday’s late trading, up 8.4% following its Q1 earnings report released after the closing bell. Earnings of $1.71 per share missed the Zacks consensus by a penny, though quarterly revenues of $17.7 billion neatly excelled past the $17.3 billion expected. Ad revenue for the social media giant rose 17% year over year to $17.4 billion in the quarter, which was expected to be a possible point of weakness.

Daily Active Users (DAU) continued growing at a decent clip, up 9.3% year over year to 1.73 billion. Monthly Active Users topped 2.6 billion in the quarter, up more than 7% from a year ago.  Five weeks ago, Facebook had issued a warning about its ad revenue business coming up short of expectations. Based on this lowered bar, the company was able to exceed projections.

Microsoft (MSFT - Free Report) kept its stellar track record of positive earnings surprises intact by posting $1.40 per share in its latest quarter, fiscal Q3 2020, beating estimates by 13 cents, while $35 billion in revenues surpassed the $33.86 billion in the Zacks consensus. Revenue growth for Azure — Microsoft’s cloud-computing space, an emerging rival of Amazon’s AWS — was up 59% year over year, helping fuel another strong quarter.

Productivity & Business Processes brought in a total of $11.7 billion in the quarter, up 15% year over year. This segment was led by Office 365 growth of 25% and LinkedIn up 21%. It was a remarkable quarterly performance from a company showing almost no signs of strain in dealing with the global coronavirus pandemic. Microsoft has not missed on quarterly earnings since fiscal Q3 2016.

Tesla (TSLA - Free Report) posted a huge swing to the positive on its Q1 bottom line, with $1.24 per share swooping past the -22 cents expected, not to mention the -$2.90 per share reported in the year-ago quarter. This also marks the third quarter in the last four where Tesla has provided either a positive or negative earnings beat of over 100%. Revenues also outpaced expectations at $5.99 billion, growth of over 20% year over year.

Tesla had already provided a production update for the quarter earlier in the month: 103K vehicles produced and 88,400 delivered. This includes an announced delay in Model 3 deliveries to China back in February, due to coronavirus concerns. Shares have hit $800 in the wake of the earnings release, up 7.3% in late trading. but at north of 60x EV/EBITDA, Tesla continues to trade like a tech stock, not an auto manufacturer.

Qualcomm (QCOM - Free Report) topped fiscal Q2 expectations on both top and bottom lines Wednesday afternoon, as well — 88 cents per share on $5.2 billion in sales sped past the 77 cents per share and $5.09 billion expected, respectively. Guidance for fiscal Q3 — between $4.8-5.2 billion in revenues, 60-80 cents per share — are steadily in line with Zacks forecasts. Chip shipments came in a tad below expectations, though QCOM shares are up 2.7% after hours.

Zacks Rank #2 (Buy)-rated eBay (EBAY - Free Report) also outperformed estimates in its Q1 report, beating on earnings by 3 cents to 77 cents per share on $2.37 billion in sales, which surged slightly past the $2.34 billion analysts were looking for. Gross Merchandise Volume (GMV) also did slightly better than expected — $21.3 billion from $20.34 billion estimated — and Q2 guidance on the revenue side was raised to $2.38-2.48 billion. Yet shares are selling off roughly 1% following the release.

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