Friday, February 2, 2024 4:50 a.m.
Technology giants Meta Platforms and Amazon ignited a market rally, with Meta’s stock soaring on strong earnings and strategic financial play, while Amazon’s stock soared on impressive earnings results. However, Apple suffered a recession due to concerns about its performance in the Chinese market.
In after-hours trading, Metaplatforms’ stock price rose to 1.5 billion on the back of better-than-expected earnings, the start of a quarterly dividend starting March 26 at 50 cents per share, and a massive $50 billion share buyback program. It soared more than % to $454.85. .
Meta, the parent company of Facebook and Instagram, bounced back from its advertising challenges in late 2022 and into 2023, increasing its market capitalization by more than $140 billion to surpass the $1 trillion mark.
“Meta is benefiting from growing Reels adoption and efforts to improve security and transparency across Instagram, the core Facebook app, and Messenger,” equity analysts at ZACKS Research wrote in a buy. I listed the reasons.
At the same time, Amazon.com’s after-hours stock price rose more than 7% to $170.60 after a strong fourth-quarter earnings report. Amazon’s revenue exceeded expectations thanks to innovative AI capabilities in its cloud and e-commerce divisions, and its cloud computing division AWS contributed to its $24.2 billion increase in the December quarter by 13%. did.
“Amazon’s high-margin business allows Amazon to drive profitability growth while continuing to make investments (last-mile delivery, fulfillment, Prime Now, Fresh, Prime digital content, Alexa/Echo, India, AWS, etc.) Yes, Amazon Prime member growth will drive recurring revenue and a positive mix shift,” said Brian Nowak, equity analyst at Morgan Stanley.
“Cloud adoption is at an inflection point. Advertising serves as a key area for both further growth potential and profitability flow-through.”
However, Apple Inc.’s stock fell nearly 3% to $181.40 in after-hours trading, even though its profit and revenue beat analysts’ expectations. The decline was largely due to lower-than-expected sales in China, where Apple expected a $6 billion decline in revenue compared to Wall Street expectations. Sales in China for the December quarter were lower than analysts expected, totaling $20.82 billion, compared to expectations of $23.53 billion.
“Q3 iPhone revenue guidance represents a 10% year-over-year decline compared to our estimate of total production of 50 million units in the quarter, down 7% year-over-year. Future user feedback from the Vision Pro is focused on, with key features such as , spatial computing, gesture sensing, and eye tracking,” said Sharon Shih, equity analyst at Morgan Stanley. .
“AI applications coming to future iPhones will be worth monitoring for future iPhone upgrade demand.”
Apple’s CFO Luca Maestri said on a conference call that the company’s revenue for the current quarter will be at least $5 billion lower than a year ago due to coronavirus-related factory closures.
Meanwhile, Qualcomm fell 5.0% due to concerns about Android sales in China.
In Asia, markets were buoyed by a late rally in U.S. tech stocks on Friday. Major US stock indexes also closed higher, with the S&P 500 up 1.25% to 4,906.19 points, the Nasdaq up 1.30% to 15,361.64 points, and the Dow Jones Industrial Average up 0.97% to 38,519.84 points. finished.