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U.S. Earnings Analysis – Projections & Insights

By  Takao Hirose (Contextual Investments, LLC)   25 October 2018  |  News
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Let’s pay attention to these important companies announcing their earnings in this week.

Summary for this report:

1.  Comcast Corporation (NASDAQ: CMCSA) is going to release its Q3 earnings before market open on Oct. 25th, Thursday.

2.  The Raytheon Company (NYSE: RTN) is going to report its Q3 earnings before market open on Oct 25th, Thursday.

3.  Twitter Inc. (NYSE: TWTR) is going to report its Q3 earnings before market open on Oct. 25th, Thursday.

4.  Alphabet Inc. (NASDAQ: GOOG) will release its Q3 earnings after market close on Oct. 25th, Thursday.

5.  Amazon.com, Inc. (NASDAQ: AMZN) is going to report its Q3 earnings after market close on Oct. 25th, Thursday.

6.  Gilead Sciences, Inc. (NASDAQ: GILD) is going to report its Q3 earnings after market close on Oct 25th, Thursday.

7.  Intel Corporation (NASDAQ: INTC) is going to report its Q3 earnings after market close on Oct. 25th, Thursday.


1. Comcast Corporation

Comcast Corporation (NASDAQ: CMCSA) is going to release its Q3 earnings before market open on Oct. 25th, Thursday.

Consensus EPS is 61¢, and consensus revenue is $21.83 billion.

The company reported its Q2 earnings in July, with higher EPS yet lower than expectation revenue. The EPS for Q2 was 65¢ compared with expected of 60¢, and revenue was %21.73 billion compared with expectation of $21.85 billion. Revenue growth was +2.1% year-over-year.

Revenue in Cable Communications department increased 3.4%, and adjusted EBITDA increased 6.5%. New customers added 182,000 in Q2, and High-Speed internet customers increased by 260,000. 

NBC universal revenue was flat, with adjusted EBITDA increased 4.2%.

(Comcast Corporation one year price chart as of Oct. 24, source from yahoo finance)


2. The Raytheon Company

The Raytheon Company (NYSE: RTN) is going to report its Q3 earnings before market open on Oct 25th, Thursday.

Consensus EPS is $2.10, and consensus revenue is $6.68 billion for Q3.

The Raytheon Company announced it beat the expectation Q2 earnings in July as below:

Actual EPS: $2.45 v.s Expected EPS: $2.36

Actual revenue: $6.63 billion v.s Expected revenue: $6.51 billion with revenue growth +5.5% year-over-year.

The management cut down its EPS guidance for fiscal year 2018 with new range of $9.77 to $9.97, while the previous expectation of $9.82. Also, the company showed new guidance of revenue for a range of $26.7 billion to $27.2 billion, compared with previous expectation of $26.76 billion.

(The Raytheon Company year to date price chart as of Oct. 24, source from yahoo finance)


3. Twitter Inc.

Twitter Inc. (NYSE: TWTR) is going to report its Q3 earnings before market open on Oct. 25th, Thursday.

Consensus EPS is 14¢, and consensus revenue is $659 million.

Twitter announced its better than expectation Q2 earnings in July as below:

Actual EPS: 17¢ v.s Expected EPS: 16¢

Actual revenue: $711 million v.s Expected revenue: $697 million, with revenue growth +23.8% year-over-year.

Actual adjusted EBITDA: $265 million v.s Expected adjusted EBITDA: $261 million

Daily active users (DAU) increased 11% year-over-year, with double-digit growth in five out of its top 10 global markets.

Monthly active users (MAUs) dropped to 335 million, lower than expectation of 338.5 million, and MAUs was also lower than Q1 of 336 million. Management said the drop was due to dissolution of partnerships with paid SMS carriers in certain markets and Europe’s General Data Protection Regulation law, which took effect from this quarter.

Twitter cut down Q3 adjusted EBITDA to a range of $215 million to $235 million from previous expectation of $268 million.

(Twitter Inc year to date price chart as of Oct. 24, source from yahoo finance)


4. Alphabet Inc.

Alphabet Inc. (NASDAQ: GOOG) will release its Q3 earnings after market close on Oct. 25th, Thursday.

Consensus EPS is $10.69, and consensus revenue is $34.04 billion for Q3.

Alphabet Inc., Google’s parent company, announced strong Q2 earnings in July, with EPS of $11.75 compared with expectation of $9.70, and announced $32.66 billion of revenue for Q2 higher than expected of $32.13 billion with 26% revenue growth year-over-year.

The following presents a summary of consolidated financial results for Q2 reported on a GAAP basis which includes the effects of the EC fines of €4.34 billion ($ 5.07billion).

Revenue: $32.66 billion

Operating income: $2.807 billion

Operating margin: 9%

Net income: $3.195 billion

Diluted EPS: $4.54

The following presents a summary of consolidated financial results for Q2 reported on a GAAP basis which does not include the effects of the EC fines of €4.34 billion ($ 5.07billion).

Revenue: $32.66 billion

Operating income: $7.878 billion

Operating margin: 24%

Diluted EPS: $11.75

Revenues on Google properties were 26.4% up year-over-year to $23.262 billion, including $28.087 billion of advertising revenue which was 23.9% higher than the same period last year.

Traffic acquisition costs (TAC) were up 12.1% to $3.411 billion, equaled 23% of Google's ad revenue.

Paid clicks were up 58% year-over-year and up 15% than Q2.

Cost per click was 22% down year-over-year and 10% less than Q2

(Alphabet Inc. year to date price chart as of Oct. 24, source from yahoo finance)


5. Amazon.com, Inc.

Amazon.com, Inc. (NASDAQ: AMZN) is going to report its Q3 earnings after market close on Oct. 25th, Thursday.

Consensus EPS is $3.07, and consensus revenue is $57.02 billion for Q3.

Amazon announced Q2 EPS of $5.07, almost double of expected EPS of $2.53 for Q2 in July, but revenue fell below expectation. Actual revenue was $52.89 billion compared with expected revenue of $53.37 billion, yet revenue growth was 39.3% up year-over-year.

Operating income was 375% up to $3 billion, beating the expectation of $1.76 billion.

Revenue in North America was 44% higher, and operating income was 321% higher than the same period last year. Revenues from overseas were 21% higher year-over-year. Amazon Web Service (AWS) revenue increased 49% with operating income up 79% to $1.64 billion.

But the company cut its guidance of revenue for Q3 from a range of $54 billion to $57.5 billion from expectation of $58.04 billion. Also, Amazon showed guidance of operating income as a range of $1.4 billion to $2.4 billion compared with market expectation of $1.3 billion.


(Amazon.com, Inc. year to date price chart as of Oct. 24, source from yahoo finance)


6. Gilead Sciences, Inc.

Gilead Sciences, Inc. (NASDAQ: GILD) is going to report its Q3 earnings after market close on Oct 25th, Thursday.

Consensus EPS is $1.63, and consensus revenue is $5.36 billion for Q3.

The company reported better than expectation Q2 result in July as bellows:

Actual EPS: $1.91 v.s Expectation EPS: $1.56

Actual revenue: $5.65 billion v.s Expectation revenue: $5.2 billion, yet revenue growth was 20.9% down year-over-year.

Strong HIV sales reached to $3.7 billion, while it was $3.2 billion for the same period last year. This is because the company released the sale of Emtriva, Biktarvy, Descovy and Genvoya.Management forecasts revenue for fiscal year 2018 to be in range of $20 billion to $21 billion, compared with expectation of $20.8 billion.

(Gilead Sciences, Inc. year to date price chart as of Oct. 24, source from yahoo finance)


7. Intel Corporation

Intel Corporation (NASDAQ: INTC) is going to report its Q3 earnings after market close on Oct. 25th, Thursday.

Consensus EPS is $1.15, and consensus revenue is $18.11 billion for Q3.

Intel announced they beat the expectation Q2 earnings in July as below:

Actual EPS: $1.04 v.s Expected EPS: 97¢

Actual revenue: $16.96 v.s Expected revenue: $16.78, revenue growth was +14.9% year-over-year.

Management forecasts EPS for Q3 in a range of $1.10 to $1.20, higher than expectation of $1.08. Also, the company raised the revenue guidance to a range of $17.6 billion to $18.6 billion from expectation of $17.62 billion.

Intel forecasts EPS for fiscal year 2018 in a range of $3.94 to $4.36, compared with previous expectation of $4.01. And the company raised revenue for fiscal year 2018 to $68.5 billion to $70.5 billion higher than expectation of $68.38 billion.

(Intel Corporation year to date price chart as of Oct. 24, source from yahoo finance)




This report was contributed by Takao Hirose, Contextual Investments, LLC., published on 22/10/2018.


The content of this article is given for general information only. As general information, no consideration or evaluation is given to the investment objectives or financial situation of any particular person. Trading and investing involve substantial financial risk. All readers of this article should make their own evaluation of the merits and suitability of any financial products and/or advice or seek specific personal advice as to the appropriateness of engaging in any activity referred to in this article in light of their own particular financial circumstances and objectives. 



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