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Apple's Q1 Surprises to the Upside, Visa Also Beats

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Market indexes spent another afternoon in the red, after enjoying something of a morning rally on strong Q4 GDP numbers and slow improvement in jobless claims. Market participants also had several hours to digest Fed Chair Powell’s comments on tightening monetary policy upon its early March Federal Open Market Committee (FOMC) meeting, and looked like buying up oversold equities, especially among blue-chips, was the way to go.

But, as we’ve seen lately, volatility claimed the mantle again around mid-day; in fact, it wasn’t so much volatility as a straight sell-off after the early gains. The Dow has mostly spent the last few days within the 34-34.5K range, the S&P between 4.3-4.35K, while the Nasdaq continues its steady slide begun roughly two weeks ago.

The Dow finished -0.02% on the day, while the S&P stayed -10% from its all-time highs reached early this month. The Nasdaq dropped another -1.40% today, while the small-cap Russell 2000 continues to take it on the chin worse than the other indexes, -2.29% on the day.

Apple (AAPL - Free Report) reported fiscal Q1 earnings after Thursday’s close, once again outperforming expectations on both top and bottom lines. Earnings of $2.10 per share beat the Zacks consensus of $1.89 and Apple’s year-ago quarterly EPS of $1.68. Revenues in the quarter accelerated to $123.90 billion, +11% year over year and above the $118.13 billion expected. Gross margins were a better-than-expected 43.8%, with outperformance in every category save iPad.

The largest goods producer/retailer in the world sold $71.6 billion in iPhones in the past quarter — an admirable feat in any market condition, but fairly extraordinary considering shortages in microchips. Growth in the quarter was +9%, again favorable compared to other tech companies over the same time period. Further, Apple has over $202 billion in cash on hand — more than several sovereign nations combined. Shares of AAPL are +3.4% in late trading, after falling -12.5% in 2022 so far.

International snack giant Mondelez (MDLZ - Free Report)   put up a mixed Q4 earnings report after today’s closing bell, with earnings of 71 cents per share missing estimates by a penny but $7.66 billion in revenues out ahead of the $7.54 billion in the Zacks consensus. Organic revenues grew +5.2% in the quarter, beating expectations of +4.7%, but costs of goods on supply-chain issues have kept profits limited, even after having raised price points in the quarter. Shares are down -3% in late trading.

Visa (V - Free Report) shares are up +5% on its fiscal Q1 earnings report this afternoon. The credit card major — which never, ever missed earnings estimates — outpace the Zacks consensus yet again in the December quarter: earnings of $1.81 per share easily surpassed the $1.69 estimates and $1.42 per share reported in the year-ago quarter, while $7.06 billion in revenues accelerated past the $6.77 billion expected. Shares are still slightly in the red from the start of 2022.

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