WEBVTT - Closing Bell: Microsoft, Meta & Ford Report Earnings 0:00:02.520 --> 0:00:07.040 Bloomberg Audio Studios, podcasts, radio news. 0:00:09.920 --> 0:00:13.360 This is the closing bell on the stock mover's report. 0:00:13.600 --> 0:00:16.560 The company's making moves at the close of US trading 0:00:16.800 --> 0:00:22.880 with Carol Master, Tim Stenebeck, Romain Bostick, and Scarlett Foo earning. 0:00:22.880 --> 0:00:24.760 It's crossing the wire qualcomm. 0:00:24.440 --> 0:00:26.639 Indeed qual common. Let's go right to the outlook. Fourth 0:00:26.680 --> 0:00:29.080 quarter revenue they're looking, folks for ten point three billion 0:00:29.120 --> 0:00:31.600 to eleven point one billion. That's above what the street 0:00:31.960 --> 0:00:34.160 is expecting, at least on the higher end. Ten point 0:00:34.200 --> 0:00:37.080 sixty one billion is what the street's expecting. Fourth quarter 0:00:37.120 --> 0:00:39.680 ad just at EPs more for the outlook two seventy 0:00:39.680 --> 0:00:42.280 five to two ninety five. The estimate on the street 0:00:42.320 --> 0:00:46.000 is for two eighty four. And again seeing let's go 0:00:46.080 --> 0:00:48.879 back to the past quarter. Third quarter just ADPs two 0:00:48.920 --> 0:00:51.640 seventy seven. That's better by a nickel in terms of 0:00:51.640 --> 0:00:53.720 what the street was expecting. And third quarter ad justed 0:00:54.160 --> 0:00:56.840 revenue of ten point thirty seven billion, pretty much in 0:00:56.880 --> 0:00:59.040 line with what the street was expecting. Tim ten point 0:00:59.040 --> 0:01:01.480 thirty three billion, Doc, little change is down about six 0:01:01.480 --> 0:01:02.880 tensive a percent here in the after mark. 0:01:02.920 --> 0:01:06.360 Yeah, pulling up that earnings release here the company actually 0:01:06.360 --> 0:01:08.920 it's not even up yet on their investor relations website. 0:01:08.920 --> 0:01:12.600 That's how early these numbers actually came out. Worth repeating. 0:01:12.800 --> 0:01:15.080 The fourth quarter revenue outlook, though, does seem to be 0:01:15.120 --> 0:01:17.280 what is moving the stock in the after hours, ever 0:01:17.360 --> 0:01:20.039 so slightly, bouncing between gains and losses down about half 0:01:20.080 --> 0:01:24.480 a percentage point. The company says nine million. Excuse me, 0:01:24.480 --> 0:01:27.039 The company says capex at seven hundred and eighty five 0:01:27.160 --> 0:01:30.120 million dollars. The company also said third quarter adjusted revenue 0:01:30.120 --> 0:01:32.800 coming in just above estimates at ten point three seven 0:01:32.880 --> 0:01:35.840 billion dollars. Once again, fourth quarter revenue that outlook ten 0:01:35.840 --> 0:01:38.240 point three billion to eleven point one billion. The estimate 0:01:38.520 --> 0:01:40.399 was for ten point six one billion dollars. 0:01:40.520 --> 0:01:40.720 Yeah. 0:01:40.720 --> 0:01:43.520 The promising sign in there, tim would be that there 0:01:43.600 --> 0:01:47.160 are signs of resilience and growth in the smartphone sector, 0:01:47.200 --> 0:01:49.160 and of course we'll be waiting for a read through 0:01:49.200 --> 0:01:52.320 on that that. When you're thinking about these large technology giants, 0:01:52.360 --> 0:01:55.120 the consumer exposure matters here a little bit. The high 0:01:55.240 --> 0:01:58.120 end phones though, are where they're doing even better, and 0:01:58.200 --> 0:02:00.840 so the question about that case shape for throughout the 0:02:00.880 --> 0:02:03.160 course of this earning season resumes. 0:02:03.280 --> 0:02:04.240 Yeah, and it's kind of interesting too. 0:02:04.240 --> 0:02:06.240 We should point out we're also expecting to get earnings 0:02:06.240 --> 0:02:08.760 out of ARM, the UK chip maker, and of course 0:02:08.760 --> 0:02:10.680 we're waiting on some of the big heavy weights in 0:02:10.720 --> 0:02:14.919 the indexes. That includes Microsoft, Meta, also expecting Ford Albumarl, 0:02:15.360 --> 0:02:18.760 LAMB Research, eBay, and Western Digital, amongst others. 0:02:18.800 --> 0:02:19.000 Guys. 0:02:19.080 --> 0:02:21.079 Yeah, and it's just a reminder that not all tip 0:02:21.120 --> 0:02:24.160 companies are the same. So Quadcom maybe giving a little 0:02:24.200 --> 0:02:26.000 bit of a better forecast, but we've been getting from 0:02:26.000 --> 0:02:30.800 Texas Instruments, Intel, which also gave more cautious outlooks. So 0:02:30.840 --> 0:02:32.560 it's just a reminder you got to take a look 0:02:32.560 --> 0:02:34.960 at each of these companies and what their fundamentals are 0:02:35.040 --> 0:02:38.040 and really what markets they play into forward reporting. 0:02:37.720 --> 0:02:39.280 In just a couple of minutes. We've got to see 0:02:39.280 --> 0:02:41.639 an interview with the company CEO coming up in. 0:02:41.880 --> 0:02:43.080 Just about a half hour. 0:02:43.360 --> 0:02:46.959 We're also expecting of course Meta platforms a little later too. 0:02:47.360 --> 0:02:49.119 Yeah, I've got to say, just to kind of get 0:02:49.120 --> 0:02:51.520 back to what we were talking about with Qualcommer, this 0:02:51.560 --> 0:02:53.320 is a stock that's only been up three point five 0:02:53.360 --> 0:02:55.800 percent this year, so there's a lot of room here 0:02:56.120 --> 0:02:58.000 for the upside of investors choose to read. 0:02:57.800 --> 0:02:58.160 It that way. 0:02:58.200 --> 0:03:01.480 But you're looking at it turn further negative here down 0:03:01.639 --> 0:03:02.280 up three percent. 0:03:02.639 --> 0:03:05.040 All right, Microsoft turnings are crossing the wire right now, 0:03:05.080 --> 0:03:07.760 So to his arm, let's start with Microsoft. The initial 0:03:07.840 --> 0:03:10.560 knee jerk reaction to the upside as the company says 0:03:10.600 --> 0:03:13.400 revenue in the most recent quarter seventy six point four 0:03:13.440 --> 0:03:15.640 to four billion, a beat the street was looking for 0:03:15.680 --> 0:03:19.400 seventy three point nine billion. Intelligent cloud revenue also coming 0:03:19.440 --> 0:03:21.840 in slightly above SIMN it's at twenty nine point eight 0:03:21.880 --> 0:03:22.359 eight billion. 0:03:22.639 --> 0:03:24.520 As you're another cloud revenue. 0:03:24.200 --> 0:03:26.840 XFX up about thirty nine percent in the border. 0:03:27.000 --> 0:03:28.040 The street was looking. 0:03:27.840 --> 0:03:31.200 For a gain of about thirty four percent in the quarter. 0:03:31.400 --> 0:03:32.840 I just want to point out one other quick thing. 0:03:32.880 --> 0:03:34.440 I know it's a much smaller business, but when it 0:03:34.480 --> 0:03:37.640 comes to the productivity and business revenue here you did 0:03:37.720 --> 0:03:40.560 actually see a beat there as well, thirty three billion dollars. 0:03:40.720 --> 0:03:43.920 And on the personal computing side, Tim Carroll, thirteen and 0:03:43.920 --> 0:03:46.040 a half billion, Street was looking for twelve point seven. 0:03:46.080 --> 0:03:47.560 I got to say, you know, I was curious about 0:03:47.560 --> 0:03:49.920 in terms of valuations for this one because Microsoft will 0:03:50.640 --> 0:03:52.880 fascinating to watch the trade here because it's bouncing around. 0:03:52.880 --> 0:03:54.320 I mean, this is a stock that's up twenty two 0:03:54.360 --> 0:03:56.480 percent year to date, and we are seeing off of 0:03:56.520 --> 0:03:59.360 these numbers initially a gain of about five percent, So 0:03:59.400 --> 0:04:01.880 investors definitely liking. 0:04:01.560 --> 0:04:02.720 What they got. 0:04:02.800 --> 0:04:05.000 I've got to say that as you're and other cloud revenue, 0:04:05.000 --> 0:04:08.280 maybe that's what's catching their attention. Up almost forty percent 0:04:08.360 --> 0:04:10.760 or up thirty nine percent, and that is easily beating 0:04:10.760 --> 0:04:12.680 the estimate of thirty four point two percent. 0:04:12.960 --> 0:04:16.720 Yeah, Satinadella, Chairman and CEO of Microsoft, saying, quote, cloud 0:04:16.760 --> 0:04:19.760 and AI is the driving force of business transformation across 0:04:19.839 --> 0:04:22.920 every industry and sector. We're innovating across the tech stack 0:04:22.960 --> 0:04:25.560 to help customers adapt and grow in this new era. 0:04:25.640 --> 0:04:27.920 And this year as you're surpassed seventy five billion dollars 0:04:27.960 --> 0:04:31.359 in revenue up thirty four percent, driven by growth across 0:04:31.440 --> 0:04:33.159 all workloads. 0:04:32.760 --> 0:04:36.120 And even beyond that, I'm looking at cap X numbers 0:04:36.200 --> 0:04:38.840 as well that came in for the quarter at least 0:04:39.200 --> 0:04:42.919 lower than expected. So that outperformance comes on the heels 0:04:43.200 --> 0:04:45.839 of not overspending either. I know a lot of investors 0:04:45.880 --> 0:04:47.560 are out there looking to make sure that they're getting 0:04:47.560 --> 0:04:50.680 a return on their buck, and you are seeing Microsoft 0:04:50.800 --> 0:04:54.440 just surging after this report because to your point, Carol Azora. 0:04:54.400 --> 0:04:56.480 Was really a big part of. 0:04:56.440 --> 0:04:59.160 What investors were looking for and making sure that more 0:04:59.200 --> 0:05:01.560 and more of that revenue was being driven by the 0:05:01.800 --> 0:05:02.520 AI initiative. 0:05:02.600 --> 0:05:04.040 And I guess I would say when it comes to AI, 0:05:04.160 --> 0:05:06.640 got to think about the Microsoft relationship with chat GPT. 0:05:07.040 --> 0:05:09.960 You know, they are kind of the king queen, if 0:05:09.960 --> 0:05:11.720 you will, in terms of what has set us going 0:05:11.720 --> 0:05:12.680 in terms of AI. 0:05:13.600 --> 0:05:15.120 We've got forward crossing the bloueb. 0:05:15.000 --> 0:05:16.640 Yeah, let's go to Ford for a second. We'll get 0:05:16.640 --> 0:05:19.440 back to Microsoft. Those earnings crossing the wire. Remember, the 0:05:19.440 --> 0:05:22.760 company had removed its guidance a quarter ago. It is 0:05:22.800 --> 0:05:26.040 now reinstating that guidance for the full year, and it 0:05:26.080 --> 0:05:27.840 does appear that guidance is lower than the one it 0:05:27.880 --> 0:05:30.760 gave before, saying that it expects earnings before interest in 0:05:30.800 --> 0:05:33.360 taxes so e BIT on an adjusted basis six point 0:05:33.400 --> 0:05:36.200 five to seven point five billion dollars. The low end 0:05:36.200 --> 0:05:38.680 of that range is slightly below the average street estimates, 0:05:38.839 --> 0:05:41.760 which was for six point eighty four billion. Also interesting, 0:05:41.880 --> 0:05:44.480 the company is trying to quantify the impact from tariffs, 0:05:44.520 --> 0:05:47.599 saying they see a tariff headwind of about two billion dollars. 0:05:47.600 --> 0:05:49.839 That's up from a previous guidance of about one and 0:05:49.880 --> 0:05:52.520 a half billion dollars, though they did point out that 0:05:52.520 --> 0:05:54.119 that number could be as high as a three billion, 0:05:54.160 --> 0:05:55.800 though they expect about one billion. 0:05:55.520 --> 0:05:57.520 Dollars in mitigation. 0:05:57.640 --> 0:05:59.560 If you will not quite sure what that means, that 0:05:59.680 --> 0:06:01.600 brings back down to two billion dollars. 0:06:01.640 --> 0:06:04.200 Well, speaking of high numbers, Meta share surging in the 0:06:04.240 --> 0:06:06.919 AFT hours up about three point six percent. The company 0:06:06.960 --> 0:06:09.840 sees third quarter revenue at forty seven and a half 0:06:09.920 --> 0:06:13.120 billion dollars to fifty billion dollars. The estimate was for 0:06:13.120 --> 0:06:17.080 forty six point two billion dollars. The company sees total 0:06:17.120 --> 0:06:18.839 revenue for the year to be in the range of 0:06:18.880 --> 0:06:22.320 forty seven point five to fifty billion dollars. It sees 0:06:22.800 --> 0:06:25.160 expenses to be one hundred and fourteen billion to one 0:06:25.200 --> 0:06:28.800 hundred and eighteen billion, so expenses were expected to be 0:06:28.800 --> 0:06:32.039 one hundred and thirteen to one hundred and eighteen billion dollars. 0:06:32.520 --> 0:06:36.080 Second quarter revenue once again beating estimate second quarter EPs 0:06:36.360 --> 0:06:39.080 coming in at seven dollars and fourteen cents. That's massively 0:06:39.080 --> 0:06:41.839 above expectations of five dollars and eighty nine cents. Second 0:06:41.920 --> 0:06:45.080 quarter revenue expected to be at forty four point eight 0:06:45.160 --> 0:06:47.760 three billion forty seven point five to two billion. Is 0:06:47.800 --> 0:06:51.120 the print share surging in the after hours up six 0:06:51.160 --> 0:06:53.160 point seven percent in climbing. 0:06:53.320 --> 0:06:55.520 Yeah, and that's after Meta has been quite an now performer. 0:06:55.560 --> 0:06:57.599 It's up about nineteen percent year to date. Hey, let's 0:06:57.600 --> 0:07:01.680 go to some commentary and context saying they expect third 0:07:01.720 --> 0:07:03.760 quarter twenty twenty five total revenue to be in the 0:07:03.839 --> 0:07:06.840 range of forty seven point five to fifty point five billion, 0:07:07.279 --> 0:07:09.600 And they say, while we are not providing an outlook 0:07:09.640 --> 0:07:11.880 for the fourth quarter revenue, we would expect our year 0:07:11.920 --> 0:07:13.960 over year growth rate in the fourth quarter of twenty 0:07:14.000 --> 0:07:17.200 twenty five to be slower than the third quarter as 0:07:17.200 --> 0:07:19.720 we lap a period of stronger growth in the fourth 0:07:19.800 --> 0:07:23.200 quarter of twenty twenty four. So they expect full year 0:07:23.240 --> 0:07:25.680 twenty twenty five total expenses to be in the range 0:07:25.680 --> 0:07:29.280 of one hundred and fourteen to one hundred and eighteen billions, 0:07:29.360 --> 0:07:32.360 So that's narrowed from their prior outlook of one thirteen 0:07:32.400 --> 0:07:34.680 to oney eighteen billion and reflecting a growth rate of 0:07:34.720 --> 0:07:37.800 twenty to twenty four percent year over year, And currently 0:07:37.880 --> 0:07:42.840 expect twenty twenty five capex including principal payments on finance 0:07:43.280 --> 0:07:45.080 leases to be in the range of sixty six to 0:07:45.120 --> 0:07:48.280 seventy two billion, narrowed from their prior outlook of sixty 0:07:48.280 --> 0:07:51.440 four to seventy two billion, and up approximately thirty billion 0:07:51.520 --> 0:07:53.120 year over year at the midpoint. 0:07:53.280 --> 0:07:55.280 I also want to look at ARM here as well, 0:07:55.320 --> 0:07:59.680 because they're forecasting profit lower than expected, they're ramping up spending. Here. 0:08:00.120 --> 0:08:02.320 You do see shares down or more than five point 0:08:02.320 --> 0:08:06.000 seven percent after the market after saying that fiscal second 0:08:06.080 --> 0:08:09.239 quarter earnings will be twenty nine cents to thirty seven 0:08:09.280 --> 0:08:13.400 cents to share. Analysts had seen thirty five cents on average. 0:08:13.440 --> 0:08:16.679 So there you go. Softer profit expectations there. 0:08:16.560 --> 0:08:18.880 All Right, recoil quickly eBay those shares higher in the 0:08:18.920 --> 0:08:21.360 after hours trade. Guidance for the third quarter of two 0:08:21.400 --> 0:08:23.680 point sixty nine to two point seven to four billion, 0:08:23.880 --> 0:08:26.360 above street estimates on both the low and the high 0:08:26.440 --> 0:08:28.520 end of the range. For the most recent quarter, the 0:08:28.560 --> 0:08:31.000 company did beat on both the top and bottom line, 0:08:31.040 --> 0:08:34.040 revenue growing six percent tim to two point seven three billion. 0:08:34.080 --> 0:08:35.960 All Right, shares a robin hood up four percent in 0:08:36.000 --> 0:08:37.960 the after hours. The company is not giving a twenty 0:08:38.000 --> 0:08:41.480 twenty five outlook for operating expenses, but second quarter adjusted 0:08:41.559 --> 0:08:44.040 EBADAH was a big beat, coming in at five hundred 0:08:44.080 --> 0:08:47.200 and forty nine million dollars. Second quarter net revenue also beat, 0:08:47.200 --> 0:08:49.800 at nine hundred and eighty nine million dollars. Once again, 0:08:49.880 --> 0:08:51.880 shares hired by about four and a half percent. 0:08:53.200 --> 0:08:57.200 This Stock Movers report from Bloomberg Radio. 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