Corporate giants from Apple Inc. to Visa Inc. are expected to report their financial results over the coming week, giving investors insight into the impact from the Covid-19 pandemic, the Delta variant and increased business costs.
In all, 180 members of the S&P 500 are scheduled to provide quarterly updates starting Monday, including the world’s biggest tech companies. The list also includes the restaurant companies McDonald’s Corp. and Starbucks Corp. , industrial firms such as 3M Co. , Boeing Co. and General Electric Co. , as well as Ford Motor Co. and the energy heavyweights Exxon Mobil Corp. and Chevron Corp.
So far, companies are on track to report strong year-over-year gains in revenue and profit, as firms are benefiting from the reopening of economies this spring, compared with the closures experienced the year before.
Still, many companies already reporting have talked about the need to raise prices for products from metal fasteners to Oreo cookies to offset rising costs for materials, transportation and workers.
The electric-car manufacturer Tesla Inc. helps to kick off the heavy earnings week Monday. The company in April reported record earnings, and Chief Executive Elon Musk told investors then that “demand is the best we’ve ever seen.” Wall Street, according to FactSet, is expecting Tesla’s sales to be $11.53 billion for the second quarter, which would surpass its first-quarter sales and nearly double the company’s $6.04 billion in sales in the year-ago second quarter.
On Tuesday, Apple, Microsoft Corp. and Alphabet Inc. are all supposed to report their latest financials after the closing bell. Apple in its March quarter saw its profit more than double on revenue that rose by more than half. For the June quarter, analysts are expecting sales of $73.3 billion, which would be lower than the $89.58 billion in March but higher than the year-ago results.
A customer listening to music at a new Apple Store in Los Angeles in June.
Photo: Lucy Nicholson/Reuters
Meanwhile, Microsoft’s sales for its fourth quarter ended in June are expected to increase 16% from a year earlier to $44.13 billion, which would represent its highest quarter ever, according to FactSet. The company has seen strong growth in both its cloud and game offerings as people have stayed at home and worked remotely.
“Over a year into the pandemic, digital adoption curves aren’t slowing down,” Satya Nadella, the company’s chief executive, said in April. “They’re accelerating, and it’s just the beginning.”
Alphabet, the parent of Google, and Facebook Inc. have benefited from an increase in spending for online ads, and better-than-expected results from Twitter Inc. and Snap Inc. on Thursday suggest those numbers could remain strong.
In the first quarter, Alphabet broke sales records, helped by higher digital ad spending, and analysts expect second-quarter sales to be higher, at $56.19 billion. Facebook, which will report second-quarter results Wednesday, has said it projects revenue growth year-over-year to slow in the last two quarters of the year. For the company’s second quarter, Wall Street sees revenue of $27.84 billion, higher than its first-quarter results.
Amazon.com Inc. is supposed to report second-quarter results Thursday, and analysts are expecting the company’s sales to rise to $115.34 billion, its third straight quarter above $100 billion in sales. During the pandemic, demand has been robust for Amazon’s delivery, cloud-computing and advertising businesses. In April, the company logged record quarterly earnings.
According to FactSet, 24% of the S&P 500 companies have already reported quarterly financial results. Earnings for the June quarter are on track to rise 74%, year over year, for the companies in the S&P 500, based on actual results and estimates for those that have yet to report, FactSet said. That percentage would mark the highest such increase since the fourth quarter of 2009, the data tracker said.
Padding the gains are easier comparisons to weaker earnings in the year-ago quarter when the pandemic limited some businesses.
Revenue for 2021’s second quarter is on pace to increase 21%, year over year, also based on actual results and estimates for companies that have yet to report, FactSet said.
Other notables expected to report quarterly results this coming week include Lockheed Martin Corp. and Hasbro Inc. on Monday. Tuesday’s cohort of companies logging results will include Visa, 3M, General Electric, Starbucks, United Parcel Service Inc., Raytheon Technologies Corp. and Mondelēz International Inc.
Wednesday’s earnings docket includes results from McDonald’s, Boeing, Ford, PayPal Holdings Inc., Qualcomm Inc. and Spotify Technology SA .
On Thursday, Wall Street and investors will hear from Mastercard Inc., Comcast Corp. , Merck & Co., T-Mobile US Inc. and Hershey Co. Friday brings quarterly financials from Exxon Mobil and Chevron, along with Caterpillar Inc.
Write to Allison Prang at [email protected]
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