Alphabet, Amazon, Microsoft, Meta: It’s a Monster Week in Earnings

Earnings season is in full swing and, so far, it’s been, well … unusual.

The season started out strong with a whopping 27 out of 30 S&P 500 companies reporting better quarterly results than Wall Street expected, leading the aggregate index to beat analysts by a full 9%. That is reported by analysts to be the highest “beat rate” since 2012.

Last week, investor sentiment shifted slightly, as evidence of a weakened economy became more clear. Netflix missed subscriber estimates for its first quarter, while Tesla’s net income and earnings dropped 20% year-over-year. Outlooks for 2023 have become murky, discouraging, and, for some companies, left out of quarterly reports entirely.

This week, some of the biggest companies on the S&P 500, like Microsoft, Alphabet, and Amazon, will release earnings reports. While you can find a full list on Nasdaq’s calendar, these are the 21 market leaders you don’t want to miss.

One note before we continue: We mention earnings per share, or EPS, in analysts’ expectations. This metric tells you how much money a company makes per share of its stock. In general, the higher the number, the more profitable the company. If the number is negative, it indicates the company is spending more than it’s earning (i.e., it’s not profitable).

Microsoft and Alphabet will both release first-quarter earnings reports after the market closes on Tuesday. The reports will be released back-to-back, with Alphabet announcing their results first (5 p.m. EDT) and Microsoft following (5:30 p.m. EDT).

The companies have been neck and neck in a race to develop stronger AI search technology. Microsoft has arguably taken the lead with its $10 billion investment in ChatGPT, which is doubtless the most formidable threat to Alphabet’s Google Search in that company’s history. Shares in both companies are up year-to-date, with Microsoft enjoying a 19.2% gain and Alphabet up slightly more at 19.5%.

Analysts are expecting Microsoft to report earnings per share (EPS) of $2.22. This would indicate the company was less profitable in the first quarter of 2023 than the fourth quarter of 2022, when the company had an EPS of $2.32. On the other hand, analysts are expecting Alphabet to generate slightly more profit with an expected EPS of $1.06 versus the $1.05 it reported for Q4 2022.

Meta will release its Q1 2023 results at 5 p.m. EDT Wednesday after the market closes.

Meta is undergoing what CEO Mark Zuckerberg has called its “year of efficiency.” So far, that’s meant laying off over 10,000 employees, closing 5,000 new job openings, and redistributing research money from nonprofitable ideas (like the metaverse) to those that have stronger legs, like AI technology.

Meta’s “restructuring” strategy is aimed at reducing expenses to a range of $89 billion to $95 billion before the end of the year. The company’s Q1 2023 could suggest its strategy is working, with layoffs improving its bottom line.

Analysts are expecting the company to report an EPS of $1.96, which would be less than the $3 it reported for Q4 2022. The company’s stock is up roughly 77% year-to-date, but is down around 4% over the last five trading days.

Amazon will announce Q1 2023 results at 5:30 p.m. EDT Thursday after the market closes.

The e-commerce giant has been reeling ever since it reported a 98% loss in year-over-year net profit for Q4 2022. In an effort to rein in operating costs, Amazon has laid off 18,000 employees this year, with plans to layoff another 9,000. Analysts are expecting the company to report an EPS of $0.21, which matches the $0.21 reported for Q4 2022.

Despite the severe cut to its bottom line, Amazon stock has been performing decently in 2023. Year-to-date, the stock is up roughly 27%, though it’s still down 26% year-over-year.

A member of the editor’s family owned Microsoft stock at the time of publication.