President Donald Trump bemoaned Thursday a lack of media attention for the “great earnings” coming out of Wall Street.
Great earnings coming out of Stock Market. Too bad Media doesn’t devote much time to this!
— Donald J. Trump (@realDonaldTrump) January 25, 2019
MarketWatch devotes a great deal of time to covering corporate earnings, and in fact kicked off a regular roundup of our extensive breaking coverage of earnings news just two days earlier. So, Mr. President, we welcome you to Earnings Watch, and want to warn you that the news isn’t all great — your tweet arrived just hours after Intel Corp.
signaled an end to its cloud boom, for example.
Trump’s lament will prove inaccurate this week, because the media will certainly pay attention to the coming corporate earnings. Some of the country’s most prominent companies are scheduled to report, including the media’s favorite 2018 target besides Trump, Facebook Inc.
; common Trump whipping boy Jeff Bezos’ Amazon.com Inc.
; and Apple Inc.
, no longer the world’s most valuable company after revealing issues with iPhone sales in China, which Trump is fighting with about trade.
Those large companies will not be alone. This will be the busiest week of earnings season, with 13 of the 30 Dow Jones Industrial Average
components and 122 members of the S&P 500 index
scheduled to report.
Here are some key themes to watch.
Executives from Alibaba Group Holding Ltd.
will discuss how trade-war concerns and an economic slowdown in China are impacting consumer spending Wednesday morning. Later that day, Facebook will give investors a glimpse at how it’s been tackling several key challenges beyond the near-daily controversies, including waning interest in the core Facebook service, the heavy costs of improving platform health, and increasing interest in ephemeral “Stories” content. Amid all its issues, Facebook is still expected to report record profit.
Tuesday report brings more intrigue than usual, after shareholder Elliott Management argued that the company should spin out its StubHub and Classifieds businesses in order to refocus on the core marketplace. EBay has obviously danced this dance before, when activist investors pushed it to spin out PayPal Holdings Inc.
, which has done well for itself (and will report earnings Wednesday afternoon).
E-commerce giant Amazon is on Thursday afternoon’s slate, after surprisingly predicting slow growth in the holiday-shopping season in October. If Amazon manages to beat the holiday expectations that its forecast lowered, it would be rare: Amazon reported more revenue than expected in the fourth quarter of 2017, but hadn’t exceeded top-line expectations in holiday shopping for eight years before that, SunTrust Robinson Humphrey analyst Youssef Squali noted recently.
Apple and the smartphone landscape
The smartphone maker’s earnings are usually a big deal, but there’s less suspense in this quarter’s report given that Apple had to preannounce negative results earlier in the month. China proved an unexpected headwind during the holiday quarter, and Apple should face questions about the extent of its woes there. The coming report also marks the start of a new era, as Apple has decided to stop reporting unit-sales metrics for the iPhone and other hardware segments. It will begin giving a bit more detail about the profitability of its services business instead.
See more about the expectations for Apple in our full earnings preview.
We’ll get more reads on the state of the smartphone industry from a handful of wireless carriers that are due to post numbers in the week ahead. Verizon Communications Inc.
reports on Tuesday before the market opens, AT&T Inc.
follows on Wednesday morning, and Sprint Corp.
delivers its numbers on Thursday morning.
More from the Dow
Among the 13 Dow components reporting next week are Boeing Co.
and McDonald’s Corp.
both on the schedule for Wednesday morning. McDonald’s is remodeling its U.S. stores, which analysts like Cowen & Co.‘s Andrew Charles believe will help boost sales, so progress in that effort will be closely watched. The Dow’s oil giants, Chevron Corp.
and Exxon Mobil Corp.
will post numbers Friday morning. UBS analyst Jon Rigby recently upgraded Chevron shares to buy from neutral, writing that the company has an “enviable” portfolio and is more focused than peers on oil and upstream projects.
kicks off the week with a Monday morning earnings report. Analysts are looking to see how the company coped with tariff headwinds as well as generally higher commodity costs. See our full earnings preview for Caterpillar.
is on the calendar for Thursday morning, along with current Dow component DowDuPont Inc.
GE has generally struggled to set an upbeat tone for its earnings calls, and investors will be looking to see if management breaks that streak this time around.
The biggest chip-maker earnings report of the week comes from Advanced Micro Devices Inc.
in the wake of rival Intel’s rough reception on Friday. Look for updates on AMD’s progress in taking server share from Intel and weathering cryptocurrency-related headwinds that have been affecting makers of GPUs. Bernstein’s Stacy Rasgon thinks the company might continue to face challenges on the crypto front, though he said that traction with some of AMD’s “new growth businesses” suggest “better days to come” eventually.
Other chip names this week will include semiconductor-equipment company KLA-Tencor Corp.
which posts results on Tuesday afternoon, and chip maker Qualcomm Inc.
which posts on Wednesday afternoon. Fiscal third-quarter numbers from Cirrus Logic Inc.
an Apple supplier., are also due out Wednesday after the market closes.
The rest of tech
Morgan Stanley analyst Keith Weiss expects Microsoft Corp.
to show benefits from an industry shift to hybrid-cloud technology from public-cloud technology when the company reports Wednesday. Cybersecurity company Check Point Software Technologies Ltd.
posts results Wednesday morning, while peers Symantec Corp.
and Proofpoint Inc.
follow on Thursday afternoon.
In financial technology, giants Visa Inc.
and Mastercard Inc.
will give reads on consumer spending when they release their numbers on Wednesday and Thursday, respectively. Total System Services Inc.
will show the effects of its efforts to clean up its balance sheet when it delivers its numbers on Tuesday afternoon.
Health and pharma
A trio of health-related names reports on Tuesday morning: Biogen Inc.
and Pfizer Inc.
follows up later in the day, while Merck & Co.
delivers its numbers Friday morning. Evercore ISI analyst Josh Schimmer recently looked at how biopharma stocks perform around earnings and found that Biogen is among the companies with the best track records, while Merck has struggled. The bottom line: “Very few companies are able to put together a ‘lengthy’ string of strong performances immediately around earnings.”