2024 Q3 Earnings Reports: Meta, Amazon, Alphabet

2024 Q3 earnings reports are gearing up to continue this week, featuring a wave of reports from some of the biggest names in tech. With Alphabet, Amazon, and Meta all slated to hold their earnings calls in the coming days, the upcoming trading sessions are poised to be quite engaging.

Did Meta’s Bet on AI Pay Off?

Meta Platforms (META) is set to release its third-quarter earnings results on October 30, just after the market closes. Wall Street analysts are optimistic ahead of Wednesday's earnings call, with expectations for Meta to report approximately $40.25 billion in Q3 revenue—a nearly 18% year-over-year increase—alongside projected net income of $13.56 billion, or $5.20 earnings per share, indicating strong financial performance if these figures hold true.

The company's advertising success increasingly hinges on AI innovations, which are enhancing user engagement and ad relevance across platforms like Facebook, Instagram, and WhatsApp. In July, CEO Mark Zuckerberg stated that Meta aims to make its AI the "most widely used assistant" by year-end. The recent introduction of Meta’s Llama 3.2 model emphasizes this goal, potentially positioning the company to compete with leaders such as OpenAI and Google.

Positive market sentiment toward Meta may stem from robust advertising growth, increased app usage among younger users, and advancements in AI capabilities. As investors await the earnings call, there are questions about how effectively Meta can manage its significant investments in both AI and the metaverse to maintain the nearly 62% share price increase observed in 2024.

Mixed Expectations for Amazon

Amazon (AMZN) will announce its Q3 2024 financial results on October 31, with investors particularly focused on Amazon Web Services (AWS) and high-margin services. The company has faced challenges in sustaining growth, especially following a mixed Q2 report where earnings per share exceeded expectations, but revenue slightly fell short, reaching $148 billion compared to the forecast of $148.8 billion. AWS, a key revenue contributor, saw a 19% year-over-year increase, highlighting its importance to Amazon's overall performance.

For Q3, Amazon anticipates revenue between $154 billion and $158 billion, projecting about 9.5% growth, which is just shy of the double-digit increases analysts had hoped for. Capital expenditures, especially in AI and the Project Kuiper satellite initiative, surged over 50% in Q2, raising questions about the efficiency of these investments.

Investor attention is also on Amazon’s advertising sector, where growth slowed last quarter, sparking concerns. Analysts expect a 21% earnings increase to $1.14 per share, with a 10% sales rise to $157.3 billion. Given ongoing market volatility, Amazon's Q3 earnings report will likely be crucial in determining whether the 23% share price growth seen since the beginning of 2024 will continue.

Alphabet’s Steady Climb

Alphabet (GOOG), Google’s parent company, is set to release its Q3 2024 earnings after the market closes on October 29, with expectations for solid revenue and profit growth. Analysts project a revenue increase of over 12% year-over-year, reaching $86.41 billion, while net income is expected to rise to $23.03 billion, or $1.85 per share, up from $1.55 per share in Q3 2023.

Google Cloud continues to be a significant revenue driver, with estimates suggesting a 29% year-over-year increase to $10.87 billion, following a 28% growth figure in Q2. However, Alphabet's investment in AI has raised concerns among investors, despite CEO Sundar Pichai emphasizing the long-term necessity of these investments.

New CFO Anat Ashkenazi, who joined in July 2024, is also expected to shed light on Alphabet’s financial priorities and potential new initiatives. Analysts are particularly interested in updates regarding Google Search and YouTube, especially in relation to AI-driven monetization and political ad spending, which could bolster Alphabet’s performance. With Alphabet shares up over 18% this year, the Q3 results will be closely scrutinized by investors.

Conclusion

With the U.S. elections approaching, global markets may experience heightened volatility in the near future. As several leading tech companies prepare to release their earnings, it remains uncertain how trading dynamics will unfold in the coming days.

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Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice.