Thursday’s Headlines: Big Tech’s Getting Uncomfortable
Here were the biggest movers in the MyWallSt shortlist yesterday:
Moving Up ⬆️
TrueCar (TRUE) +9.5%
Chuy's (CHUY) +9.2%
Texas Roadhouse (TXRH) +7.5%
Shopify (SHOP) +7.0%
ShotSpotter (SSTI) +6.4%
Moving Down ⬇️
Ford Motor Company (F) -1.3%
Pure Storage (PSTG) -1.6%
Fitbit (FIT) -1.8%
Spotify (SPOT) -1.8%
IMAX (IMAX) -10.7%
1. Even if we had all day, I could not delve fully into the full scale of the House Antitrust subcommittee’s grilling of Big Tech last night on Capitol Hill. However, as the final hearing before the subcommittee files its report on an investigation that has been ongoing since June 2019, some uncomfortable questions were asked of Big Tech’s CEOs, with Facebook (FB) and Amazon (AMZN) among the hardest hit. These two, along with Alphabet (GOOG) and Apple (AAPL), will report on their Q2 earnings after-close today in what could be a massive catalyst for the market’s performance over the coming quarter, one way or another. Read an in-depth report on the antitrust hearing here.
2. With the distinct advantage of being the largest e-commerce company NOT testifying in front of Congress this week, Shopify (SHOP) stock soared 7% yesterday after it smashed Q2 expectations. Revenue soared 97% YoY to $714 million for the quarter, helping the Canadian company to achieve an EPS of $1.05, far surpassing the $0.01 on revenue of $510.8 million expected. Despite the threat of coronavirus on its small and medium-sized clients, gross merchandise volume still soared 119%, while Shopify stock remains up 158% YTD. Get the official earnings report here.
3. Not even a deal with the Kardashians, Joe Rogan, or the Obama’s could help Spotify (SPOT) meet expectations in Q2 it seems, as the music streamer disappointed investors. Shares in the Swedish company fell 1.76% on its loss of 356 million euros, or 1.91 euros per share, driven largely by a 23% decline in ad revenue. There was some optimism though as the company’s total paid subscribers hit 138 million, beating estimates, while guidance for Q3 sees it reaching between 140-144 million. Get Spotify’s official earnings release here.
Here are some more earnings from yesterday:
When nobody wants to touch physical cash, it helps to be part of the online transaction boom, as proven by PayPal’s (PYPL) earnings of $1.53 billion, or $1.29 per share in Q2. The company is optimistic on Q3 too, producing guidance of 25% growth in revenue. See the official report here.
Automative software maker ServiceNow (NOW) produced an earnings surprise of 20.6% in Q2, reporting EPS of $1.23 per share on revenue of $1.07 billion. This marks the fourth quarter in four that ServiceNow has topped consensus estimates. See the full earnings here.
Telemedicine leader Teladoc (TDOC) missed on EPS on Wednesday, reporting losses per share of $0.34 on revenue of $241.03 million. However, the company’s reported net loss of $25.68 million was still 12.4% narrower than the same time last year. See the official report here.
There are seven companies in the MyWallSt shortlist that will report earnings today: