Fast Money Blog- 7/29/22
The big stories this week on Wall Street were the earning releases for Alphabet Inc. (GOOGL), Microsoft Corporation (MSFT), Apple, Inc. (AAPL), and Amazon.com, Inc. (AMZN).
On Tuesday, July 26th both Alphabet Inc. (GOOGL) and Microsoft Corporation (MSFT) released their earning reports.
Alphabet posted Q2 2022 top-line revenue of $69.69 billion a growth of 13% in the quarter, down from a growth of 62% just a year earlier. This marked the second straight quarter of year-over-year earnings declines for Google — its first since 2015.
Advertising revenue increased just 12% to $56.3 billion, as marketers cut their spending to manage inflation costs. The most notable deceleration was in the YouTube division, where sales rose 5% to $7.3 billion after jumping 84% in the same period a year ago.
Google's advertising revenue tied to internet search showed resilience as search-related ad revenue rose 14% year-over-year. to $40.69 billion, up from $35.85 billion the year prior.
Google said cloud-computing revenue rose 37% to $6.3 billion.
Because of all of this revenue growth, Google makes a great trade or long-term hold, post split.
Microsoft posted Q4 2021 top-line revenue of $51.8 billion, a 12% growth in the quarter year-over-year.
Their total earnings are broken into several divisions, the most important being:
Productivity and Business Processes, which includes Dynamics, LinkedIn and Office, brought in $16.6 billion, up 13% year-over-year.
The Intelligent Cloud segment which includes their Azure public cloud service, brought in $20.9 billion, up 20% year-over-year.
The More Personal Computing which is primarily revenue from Windows, search and news advertising, gaming, and Surface, brought in $14.4 billion, up 2% year-over-year.
For its fiscal year 2022, Microsoft’s revenue was $198.3 billion, an increase of 18% from fiscal year 2021.
Microsoft continues to be a standout from a revenue point of view. I consider the shares to be an excellent long-term hold.
On Thursday, July 28th, both Apple, Inc. (AAPL) and Amazon.com, Inc. (AMZN) released their earning reports.
Apple posted Q3 2022 earnings with top-line revenue of $83 billion, an increase of 2% year over year.
Here’s the full revenue breakdown for the quarter:
iPhone- $40.7 billion (up 3% YOY)
Mac - $7.4 billion (down 10% YOY)
iPad: $7.2 billion, down from 2% year-over-year.
Services, which includes iCloud and Apple Music fees- $19.6 billion (Up 12% YOY)
Once again, Apple has amazed us with revenue increases across all major divisions.
Amazon posted Q2 2022 earnings with top-line revenue of $121.2 billion, an increase of 7.2% year over year.
Amazon Web Services, the profitable cloud-computing division, generated sales of $19.7 billion in the quarter.
Advertising services, another huge money producing division, increased 14% to $8.76 billion.
Amazon continues to amaze with revenue growth post-split. Clearly it is time to purchase more shares.
In other news, on Wednesday, July 27th, in a continued effort to bring down inflation the Federal Reserve increased interest rates by .75 percentage points for the second consecutive time.
In closing, it’s great to see the stock market rebound in light of the positive financial data we have learned this week. I believe there’s more positive data to come.