Stocks – what to expect from the tech titans reporting this week.

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Apple

Results for Apple’s fiscal third quarter are due out after the close on Tuesday. The stock has fallen by more than 20% over the last 12 months, massively underperforming the rest of the market – the Dow Jones is up 3.7% over the period. Fears are mounting that Apple is about to record its first ever annual decline in iPhones, while a slump in Apple Watch sales is expected to weigh. Falling sales of the cash-cow iPhone may be partially offset by better numbers from software and services.

Expectations are not particularly high after last quarter saw iPhone sales fall for the first time. Revenues of around $42bn are expected, with an EPS of $1.40, which is around 25% down from a year before. Last quarter Apple missed expectations by around $2bn, snapping a 13-quarter streak of beating estimates.

Google (Alphabet)

 

There’s been better news for Alphabet, the parent company of Goole, which is reporting on Thursday. Its stock is up around 15% for the last 12 months. Last quarter it missed expectations, reporting EPS of $7.50, versus a forecast $7.97. Despite undershooting, adjusted earnings were still up 16% from a year before.

EPS is expected to hit $8 again, up 15% from a year before on revenues in excess of $20bn.

 

Facebook

 

Unlike Apple, the mood around Facebook is very bullish. Its stock is up 20% over the last 12 months as investors bet big on the future. Facebook is looking incredibly strong – revenues up 46% over the last year.

Facebook makes a habit of beating forecasts but with expectations so high it’s a tough bar to clear. Analysts estimates vary, but consensus seems to be for EPS coming in at $0.81 on $6bn in revenues, which would represent year-over-year increases of 62% and 50% respectively.

Investors will be looking at key user metrics, in particular daily active users who are highly engaged. Last quarter this number rose 16% to top one billion. They will also be looking for something positive on Facebook’s virtual reality efforts, particularly in light of the recent success of Pokemon Go.

Amazon

 

Amazon smashed expectations last quarter. Net income rose to $513 million, for an EPS of $1.07, on revenue of $29.13 billion. The year before it posted a loss of 12 cents per share.

A booming cloud computing market could help lift Amazon to another record-smashing quarter when it reports next Thursday. In Q1, the firm reported a 64 per cent jump in revenues to $2.57bn from its Amazon Web Services cloud product.

Rivals are doing well - revenue from Microsoft’s Azure cloud product grew 102 per cent, while IBM has said public, private and hybrid cloud revenues surged 30 per cent in Q2 2016 to $3.4bn. 

Amazon shares are up around 50% in the last 12 months following a run of earnings beats. A record Prime Day and booming cloud market are all supporting the stock, which has notched up fresh record highs.

Non-GAAP EPS is expected to come in at $1.11, miles ahead of the same quarter a year before ($0.19) and a slight improvement on Q1 ($1.07).