Amazon’s share price plunged more than 12% in after-hours trading after missing expectations with $127.1 billion in revenue, driven by disappointing AWS revenue. Earnings per share (EPS) came in at $0.28.
Apple shares declined 5% despite beating earnings expectations due to slightly weaker-than-expected iPhone sales.
US markets trended lower for the second day yesterday, as the S&P 500 closed 0.6% lower and the Nasdaq fell 1.6%.
The Nikkei 225 followed in their footsteps and is down 1% in early morning trade, while the Hang Seng is again extending its losses with a decline of 3.4%.
In other news, several Twitter executives departed on Elon Musk’s first day at the company, and Twitter’s engineers were locked out of the code.
Here is the biggest news of the day.
- Amazon’s share price plunged more than 12% in after-hours trading after missing revenue expectations. Earnings per share (EPS) came in at $0.28 compared to analyst estimates of $0.21. Revenue of $127.1 billion missed analyst expectations of $127.5 billion. Amazon Web Services in particular, disappointed with only $20.5 billion in revenue compared to analyst estimates of $21.1 billion. The company also guided to a consumer-driven slowdown in sales growth for the holiday season.
- Apple shares decline 5% despite beating earnings expectations. Earnings per share (EPS) came in at $1.29, beating estimates of $1.27. Revenue of $90.2 billion was reported, higher than analyst estimates of $88.8 billion. The drop is believed to be due to iPhone revenue slightly missing expectations of $43.21 billion, coming in at $42.63 billion. Apple CFO Luca Maestri expects slower growth in the next quarter.
- Twitter executives out on Elon Musk’s first day at the company. Departures include Twitter Chief Executive Officer Parag Agrawal, Chief Financial Officer Ned Segal, head of legal, policy and trust Vijaya Gadde, and Sean Edgett, who has been general counsel at Twitter since 2012. According to unnamed sources, Edgett was escorted out of the building. Musk brought in Tesla engineers to meet with product leaders at Twitter, and by noon he had locked out Twitter engineers to ensure they could not change code ahead of the deal closing.
- Shopify shares climbed 17% on a smaller-than-expected loss. The company made a loss per share (LPS) of $0.02, which was better than the expected loss of $0.07 per share. Revenue of $1.37 billion was reported, slightly beating estimates of $1.34 billion.
- Intel jumped 5.5% in after-hours trading after beating earnings estimates. Earnings per share (EPS) was reported at $0.59, beating expectations of $0.34. Revenue came in at $15.3 billion, roughly in line with expectations. The market responded particularly well to the announcement of planned cost reductions of up to $10 billion through 2025.
- The European Central Bank (ECB) has raised interest rates by 0.75% to the highest level since 2009 at 1.50%. ECB rates had been negative – below 0% – for eight years until it hiked in July. The ECB will also start discussions in December to reduce its balance sheet of mostly government bonds.
- The Bank of Japan doesn’t buckle and sticks to its dovish stance despite the Yen and Japanese government bonds being punished. The central bank kept interest rates unchanged and said it would purchase the necessary amounts of Japanese government bonds at a fixed rate in order to keep 10-year JGB yields at around 0%.
- Impala production figures remain relatively stable. Gross tons milled at managed operations improved by 2% to 5.85 million tons, with volume gains at Impala Rustenburg and Zimplats, stable production at Marula, and marginally lower mill throughput at Impala Canada. Group 6E in concentrate production increased by 2% to 824 000 ounces.
- Glencore expects a significantly reduced but still above-average second half. EBIT contribution in the second half is expected to exceed $1.6 billion and end the year near the top of the EBIT guidance range of between $2.2 billion and $3.2 billion.