Alphabet falls 12.6% as Amazon and Intel slide after earnings
In short
- Alphabet fell 12.64% to $283.82, its worst day since listing, after capital spending of more than $51bn in the quarter and negative free cash flow.
- Amazon is down in after-hours trading (-5.39% at $230.64 after dropping more than 10% at one point) and Intel is down more than 20%.
- The Nasdaq Composite closed down 1.38% at 26,184.72, and Japan’s Nikkei 225 is down 2.54% with chip stocks leading.
Alphabet had its worst day since listing and dragged the Nasdaq lower, while Amazon and Intel are sliding after earnings on heavy spending and weaker guidance. Yesterday we wrote about Microsoft and Alphabet’s results and what to expect from Amazon. Now the market has reacted.
What happened
Alphabet fell 12.64%, its worst day since listing. Capital spending for the quarter was above $51bn and free cash flow turned negative (TradingKey). Microsoft, which was higher before the open yesterday, reversed and closed down 0.16% at $530.14. Yesterday’s premarket figures in our earlier article differ from the closing moves.
After the close Amazon reported revenue of $201.94bn (+12%), slightly below expectations. AWS grew 39.3% to $45.98bn, ahead of forecasts, and operating profit was $28.08bn (+61%). The company kept its plan for about $220bn of capital spending, and free cash flow over the last 12 months is an outflow of about $42.4bn. Fourth-quarter revenue guidance is $240-247bn, with the midpoint slightly below expectations (TechFlow). The shares fell more than 10% after hours, then narrowed the drop to 5.39% (TradingKey).
Intel reported revenue of $16.5bn (+21%) and adjusted earnings of $0.52 a share, above expectations. Fourth-quarter guidance is $15-16bn of revenue and $0.25 a share, against about $17bn and $0.43 expected. An explosion at its Kiryat Gat plant in Israel in October will cut about $300m from fourth-quarter revenue. Data centre and AI revenue rose 78% to $7.3bn. The shares are down more than 20% after hours (TechFlow). In Asia the Nikkei 225 is down 2.54%, led by chip stocks (ABC News).
What it means for you
The maths: £1,000 in Alphabet lost about £126 yesterday (before any currency effect). In Amazon the loss in the regular session was about £42 (-4.25%), and after-hours trading points to a further £54 (-5.39%). In Intel the session loss was about £36, and after hours the drop is more than £200. These figures are as of 7:00 am Bulgarian time (5:00 am in London). The real move will show at the US open at 1:30 pm London time.
Apple closed up 1.48% at $348.91, its highest level in a year, according to HawkValue data. Follow the indices on the UK stock market page and gold on UK gold prices.
Bottom line
Alphabet fell 12.64% on heavy spending and negative free cash flow. Amazon and Intel are falling in after-hours trading after their earnings and weaker guidance, and chip stocks are weak in Asia. Moves after the US open may differ.
Sources: TradingKey · TechFlow · ABC News
For information only. This is not investment advice.
More news
AMD falls 10.9% before Tuesday’s results as chip stocks sink
AMD fell 10.9% on Friday after Intel’s weak outlook and reports on Tuesday. What the market expects and what it means for your shares.
Apple and Palantir report Monday: what the market expects
Apple and Palantir report on Monday after the US close. What analysts expect for revenue and profit, and the move options markets are pricing in.
Wall Street falls 1.8% as Intel plunges 29% and tech sinks
S&P 500 down 1.83%, Nasdaq down 2.84%, Intel and Reddit down 29%. What happened on Wall Street on Friday and what £1,000 in shares lost.
