Amazon, Apple, Meta Tout Results With Tech Rally On The Line
Amazon reported what the company described as a record-breaking holiday quarter in results released after the bell in the US on Thursday.
Revenue of $170 billion topped estimates (the Street was looking for $166.2 billion) and represented the briskest pace of top-line growth since the September quarter of 2022, when sales growth rebounded sharply after bottoming at around half the current rate.
Still, 14% (13% ex-currency impact) is a mile below the eye-watering pace observed during the pandem
META stock ripping AM like the beat was much bigger . . . maybe is the dividend? Even though initiating a dividend for “more flexibility in return of capital to shareholders” hints that buybacks are less attractive now?
Anyway, the ARPU growth was higher than 3Q, and estimates will go up for 1Q. After that, the tougher YOY comps may be a concern.
Interesting to see Zuckerberg mention smart glasses + AI as an alternative path to AR (“AR” liberally defined). They are also remind people that META has genAI too, that users can interact with Llama in a different way than the other companies’ genAI. The Meta glasses have some buzz online, I bought a pair to try out.
That Meta position I took in October 2022 (and publicized here at the time in several comments) now stands as one of the better “dumb long” bets I’ve ever made. I can barely believe it at this point.
The nice thing about META and the other big techs is, when you like them, you can put in a bunch of weight and not be taking too much risk vs benchmarks – actually you may be reducing that risk. Vs if you want to load up on some small cap group.
Also, I didn’t hear many questions on Reality Labs on the call. It feels like investors are just treating it like R&D and/or appeased by the positives in the rest of the business.
Yeah, I don’t think anyone cares that he burns money in there anymore. It’s not like he renamed the company after it or anything. 🙂
Jensen ?? Reality Labs
Jensen heart Reality Labs
Those bar charts are amazing. Stocks moving to all time highs based on declining revenue growth. That makes sense!!
It truly does not pay to think. Trend-following CTAs are looking more and more attractive.
AAPL consensus went down markedly on the report. E.g. Mar qtr cons rev down YOY vs guid flat. Fears of underwhelming iPhone 16 cycles, declining China share, Vision Pro not the “next iPhone”, Mac and iPad becoming like PCs growth-wise, late to the genAI party, and how safe is the services walled garden? Stock trying to hold support.
AMZN had arguably as good a quarter as META. Commerce finally growing into the pandemic-built logistics footprint, advertising outgrowing any other big Tech’s ad business, AWS growing as much as peers from a much larger base. No surprise dividend initiation, but tough comps look a quarter further away than META’s.