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3 US Big Tech companies reporting earnings this week
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US100 down almost 9% year-to-date
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Alphabet expected to report 20+% jump in sales and profits
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Focus on new projects of Meta Platforms
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PrimeVideo and AWS cloud on watch in Amazon earnings
US stock markets have the worst January since 2009 behind them. Fears over Fed tightening have pushed stock prices lower, with tech shares being heavily impacted. US100 dropped almost 9% in January. This week will host the release of Q4 quarterly reports from 3 US Big Tech companies - Alphabet, Meta Platforms and Amazon. Those stocks account for a big share of US indices and their earnings reports may provide fuel for moves on Wall Street.
Alphabet
Alphabet (GOOGL.US) is the first of US Big Tech companies to report earnings this week. Results will be released today on Tuesday, February 1 after the close of the Wall Street session. Analysts expect the company to report a 27.8% YoY jump in sales excluding traffic acquisition costs. EPS is expected to jump 23% YoY. Investors' attention, however, will focus on trends in ad revenue. Apart from that, market participants will watch developments in and guidance for the cloud segment that is once again expected to report losses.
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Sales (excluding TAC): $59.3 billion expected vs $46.4 billion in Q4 2020
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Earnings per share: $27.45 expected vs $22.30 in Q4 2020
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Google Cloud segment revenue: $5.5 billion expected, up 45% YoY
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Google Cloud segment profit: -$705 million expected
Alphabet (GOOGL.US) has underperformed recently, just like other tech shares. However, stock managed to bounce off the lower limit of the Overbalance structure, confirming that uptrend is still in play. Share price regained some ground and from a technical point of view, the way towards highs above $3,000 is left open. However, earnings release is a big risk event with potential to reverse the trend.
Source: xStation5
Meta Platforms
Meta Platforms (FB.US), formerly Facebook, will report Q4 2021 results on Wednesday after the US session closes. The company has recently rebranded itself and said that it will focus more on metaverse. Meta said that rebranding is not going to be profitable in near-term and that R&D investment in metaverse will lower its 2021 operating profits by around $10 billion with even bigger investments expected in the future years. Investors will look for clues on the company's new projects like virtual reality headset Oculus. Outlook for the full-2022 will also be closely watched.
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Revenue: $33.44 billion expected vs $28.07 billion in Q4 2021
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Earnings per share: $3.83 expected vs $3.88 in Q4 2021
Meta Platforms (FB.US) dropped below the lower limit of the upward channel and started to trade in a downward channel. Stock has recently bounced off the lower limit of the channel near 38.2% retracement of the post-pandemic recovery move. The nearest resistance to watch can be found at the upper limit of the downward channel in the $340 area.
Source: xStation5
Amazon
Amazon (AMZN.US), the final of 3 Big Tech companies reporting this week, will release Q4 2021 results on Thursday after the Wall Street session closes. Revenue growth of Amazon has slowed in recent growths but the company continues to expand to capture near growth opportunities. Investors will look how those new segments, like AWS cloud or PrimeVideo, performed and contributed to future earnings. Amazon has announced plans to hire thousands of new workers to meet increased demand for its services. Revenue guidance for coming quarters will also be on watch.
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Revenue: $137.87 billion expected vs $125.56 billion in Q4 2021
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Earnings per share: $3.89 expected vs $14.09 in Q4 2021
Amazon (AMZN.US) had a very poor start to the year. Share price plunged and reached the lowest level since mid-2020. However, price reacted to the 161.8% exterior retracement of that Q4 2021 upward impulse and a recovery move was launched this week. Stock move back above $2,900 support zone and could reached the next major resistance in $3,200 area if earnings report beats expectations.
Source: xStation5
