Tech stocks Microsoft, Google & AMD take a hit
When shares trade at a record highs stocks are priced for perfection and when perfection doesn’t come it is an opportunity to sell.
Both reported revenue and earnings that beat estimates, but MSFT sold off more than 2% and GOOG shares closed down almost 7%. Advanced Micro Devices (AMD) was another although there was also a poor outlook that accompanied it’s earnings.
(AI Video Summary)
Alphabet
The tech industry had an eventful night with Microsoft and Alphabet, two big companies, making waves with their stocks. Microsoft's shares took a hit during the trading session, but they made a comeback in extended trading, rising overall. Microsoft's earnings and sales were up and down, but they exceeded expectations in terms of earnings per share, reaching a impressive $2.93. One of the reasons for this success was Microsoft's Azure cloud service, which attracted a whopping 53,000 new customers in the past year with the help of AI features. The Intelligent Cloud Unit, where Azure resides, also experienced a solid 20% growth in revenue, reaching a total of $25.9 billion.
Microsoft
Despite Microsoft's recent record-breaking success, investors were still demanding more. They were disappointed by news about the development of AI features, which had an impact on the share prices. However, Microsoft's stock managed to keep its market cap above three trillion, which is an astonishing achievement. On the other hand, Alphabet, the parent company of Google, also disappointed investors with a 7% drop in their shares during extended trading. While the company's earnings per share were slightly higher than expected, and total sales were better than anticipated, they faced tough competition from Microsoft in the AI development field. This led to a significant decrease in Alphabet's stock, the biggest drop seen in several months.
AMD
Another company that faced disappointment was Advanced Micro Devices (AMD). Their shares took a massive nearly 10% hit in extended trading. AMD's earnings per share were slightly higher than forecasted, and their revenue reached a solid $6.2 billion. Their AI processors showed great promise, resulting in an optimistic 2024 forecast. However, these results were not enough to satisfy demanding investors. The stock took a heavy blow during the session, dropping by 10.36% for the current quarter. AMD's projected revenue for the future was also lower than what analysts had predicted, further contributing to the disappointment. Similar to Microsoft and Alphabet, AMD's stock had recently reached record highs but failed to live up to the high expectations set by investors. Overall, it was a night of ups and downs for these tech giants, demonstrating that even companies with impressive track records can face challenges and disappointments in the ever-changing world of trading.
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