Earnings Recap: Microsoft, Meta, Qualcomm, ARM, Starbucks, Lam Research Report Quarterly Results
Key Takeaways
- •Microsoft delivered fourth-quarter EPS of $4.74 and revenue of $90.0 billion, both exceeding consensus, while capital expenditures surged to $41.0 billion to support AI and cloud infrastructure expansion.
- •Meta Platforms reported EPS of $6.18, missing the $7.19 estimate, but slightly surpassed revenue expectations at $60.8 billion and raised its capital expenditure guidance range to $130–145 billion.
- •Despite beating both EPS and revenue estimates, ARM Holdings saw its shares decline 9.3% in after-hours trading due to elevated valuation multiples that amplified post-earnings volatility.
- •Qualcomm narrowly missed EPS estimates at $2.21 versus $2.23 but surpassed revenue projections at $9.95 billion, with shares falling 10.4% and now down approximately 50% from their May 26 closing high.
- •Starbucks significantly outperformed expectations with EPS of $0.85 against a $0.66 estimate and revenue of $9.3 billion, leading to a 7.6% jump in after-hours trading.
A pivotal day for monetary policy set the stage for a heavy slate of corporate earnings reports, with the Nasdaq declining 1.7% as investors weighed the incoming results. The companies reporting span the technology, semiconductor, and consumer sectors, and several are among the largest constituents of major U.S. equity indices.
Microsoft (MSFT)
Microsoft reported fourth-quarter earnings per share of $4.74, exceeding the consensus estimate of $4.24. The results included a benefit of $0.27. Revenue came in at $90.0 billion, ahead of the $87.62 billion estimate, driven by cloud revenue growth of 27% year over year. Free cash flow was $19.6 billion, down 23% year over year, while fourth-quarter capital expenditures reached $41.0 billion. The sharp rise in capital spending reflects Microsoft's ongoing buildout of data center infrastructure to meet accelerating demand for artificial intelligence and cloud computing services. Microsoft had not yet provided updated capital expenditure guidance at the time of reporting. Shares rose approximately 1% in after-hours trading.
Microsoft is one of the largest technology companies in the world and a major component of the Nasdaq Composite and the S&P 500. Its Azure cloud platform is a key competitor to Amazon Web Services and Google Cloud.
Meta Platforms (META)
Meta posted earnings per share of $6.18, falling short of the $7.19 estimate. Revenue totaled $60.8 billion, slightly above the $60.22 billion consensus. Free cash flow was $784 million. The company raised its capital expenditure guidance to a range of $130–$145 billion, compared with the prior range of $125–$145 billion. Like Microsoft, Meta is directing substantial investment toward AI infrastructure, including data centers and computing hardware to support its AI-powered advertising and product initiatives. Shares declined about 5% in after-hours trading.
Meta Platforms is the parent company of Facebook, Instagram, and WhatsApp and is a leading digital advertising platform globally.
ARM Holdings (ARM)
ARM Holdings reported earnings per share of $0.45 versus the $0.40 estimate, with revenue of $1.29 billion against the $1.26 billion consensus. Shares fell 9.3% in after-hours trading despite the beat. ARM went public in September 2023 and trades at elevated valuation multiples relative to many semiconductor peers, which can amplify post-earnings volatility when results do not exceed already high investor expectations.
ARM, headquartered in Cambridge, United Kingdom, designs semiconductor architecture used in the vast majority of the world's smartphones.
Lam Research (LRCX)
Lam Research reported earnings per share of $1.82, beating the $1.68 estimate. Revenue was $6.722 billion, above the $6.665 billion consensus. Shares rose 2.5% after hours. Lam Research is part of a concentrated group of semiconductor equipment makers—including ASML, Applied Materials, and KLA—whose results are closely watched as indicators of global chip manufacturing investment.
Lam Research is a major supplier of wafer fabrication equipment to the semiconductor industry.
Starbucks (SBUX)
Starbucks delivered earnings per share of $0.85, well ahead of the $0.66 estimate. Revenue reached $9.3 billion, topping the $9.17 billion consensus. Shares jumped 7.6% in after-hours trading.
Starbucks is the world's largest coffeehouse chain, operating thousands of locations across more than 80 countries.
Qualcomm (QCOM)
Qualcomm reported earnings per share of $2.21, just below the $2.23 estimate. Revenue came in at $9.95 billion, surpassing the $9.68 billion consensus. Shares dropped 10.4% in after-hours trading. With that decline, Qualcomm shares have fallen nearly 50% from their May 26 closing high of $259. Qualcomm has been working to diversify its revenue base beyond mobile handset chips into automotive and Internet of Things markets, though the smartphone segment remains its largest business.
Qualcomm is a leading designer and supplier of wireless technology and semiconductors, particularly known for its Snapdragon mobile processors used in Android smartphones.
Source: Investinglive