NetApp's Q3 FY24 revenue surged 5% to $1.6 billion, driven by record all-flash array sales and profits of $313 million. CEO George Kurian attributes the success to the momentum of their expanded all-flash product portfolio and operational discipline. The company's lower cost all-flash arrays outperformed competitors, leading to a sustainable step-up in product gross margin. Despite a minor revenue lift in the public cloud business, NetApp is focusing on first-party and hyperscaler marketplace storage services for growth. The company raised its full-year revenue outlook and is confident in its ability to capitalize on market opportunities.
Analysts are optimistic about Amazon's quarterly financial results, with a focus on holiday season sales, progress in the Amazon Web Services cloud business, and the expansion of the advertising segment. Expectations include revenue growth in various segments, with a consensus forecast for strong sales and profits. Analysts predict Amazon will exceed Wall Street's revenue expectations, with a focus on reaccelerating growth in the cloud business and gaining e-commerce market share. Mizuho analyst James Lee is bullish on Amazon's e-commerce business and expects results from the ad business to surpass Street estimates, rating Amazon as his top pick in the internet sector.
Alphabet's stock dropped over 5% after the company's fourth quarter earnings missed expectations on ad revenue, despite reporting higher revenue and continued growth in its cloud business. The company is focusing on streamlining its business to achieve cost savings and efficiency, including laying off hundreds of workers and investing in AI. Google executives addressed concerns about AI disrupting search products, emphasizing that AI tools expand Google's capabilities. Despite the miss on ad revenue, the company's cloud revenue beat expectations, signaling its growing importance to investors.
Alphabet's stock slipped over 5% after the company missed analysts' expectations on ad revenue in its fourth quarter earnings report, despite reporting higher revenue and continued growth in its cloud business. The company is focusing on streamlining its business to achieve cost savings and efficiency, including laying off hundreds of workers and investing in AI. Google's executives addressed concerns about AI potentially disrupting the company's search products, emphasizing that AI tools expand Google's arsenal and offer a breadth and depth of information to users.
Google parent company Alphabet missed analysts' expectations on ad revenue in its fourth quarter earnings report, causing its stock to slide 4% lower in extended trading. Despite the ad revenue miss, the company reported continued growth in its cloud business, with revenue exceeding expectations at over $9 billion. The earnings report comes after Google recently laid off hundreds of workers and aims to focus on growth areas, including AI, as it seeks to claim additional market share in the cloud computing market.
Alphabet, Google's parent company, reported fourth quarter earnings that missed analysts' expectations on ad revenue, causing the stock to slide 4% lower in extended trading. Despite the ad revenue miss, the company saw continued growth in its cloud business, with revenue exceeding expectations at over $9 billion. Google CEO Sundar Pichai highlighted the strength in Search, YouTube, and Cloud, all benefiting from AI investments and innovation. The earnings report comes after Google's recent layoffs and its push to claim more market share in the cloud computing industry.
Alibaba is initiating a revamp of its cloud business by restructuring its leadership, aiming to revive growth and capitalize on the AI boom after canceling the highly anticipated spinoff of its $11 billion cloud unit. The company has appointed three new executives to head major business lines within Alibaba Cloud Intelligence, with a focus on reclaiming market share lost to state-backed rivals. The move comes after a week of management turmoil and a $24 billion selloff. The cloud division is crucial to Alibaba's AI initiatives, hosting half of China's generative AI firms and serving about 80% of the country's technology companies. The new appointments may signal a wider restructuring following the cancellation of the spinoff.
Amazon's stock slid 5% ahead of its third-quarter earnings announcement, raising concerns about its cloud business following Google and Microsoft's recent results. Analysts expect Amazon to report earnings of 59 cents per share and revenue of $141.5 billion. Despite the FTC antitrust lawsuit and AWS worries, analysts remain optimistic about Amazon's prospects, citing its exposure to affluent consumers, advertising opportunities, potential e-commerce margin improvement, and AWS growth.
As Amazon.com prepares to release its third-quarter results, investors are closely watching the performance of Amazon Web Services (AWS), the world's largest cloud provider and a major profit driver for the company. The recent strong earnings from Microsoft's cloud business and weak cloud sales from Google have raised expectations and concerns for AWS. Analysts predict potential flat growth for AWS due to customers optimizing software spending, but this may already be factored into the stock. Additionally, the impact of artificial intelligence (AI) on AWS's performance is being closely monitored, with Microsoft seen as having a head start in this area.
The Nasdaq and S&P 500 declined as Alphabet's cloud division missed revenue estimates, causing the tech giant's stock to slump. In contrast, Microsoft saw post-earnings gains and rose to a three-month high after exceeding expectations in all segments, including its cloud business. Concerns arose that Alphabet is losing ground to Microsoft and Amazon in the growing sector of generative artificial intelligence. Long-dated U.S. Treasury yields also weighed on mega-cap stocks, with Meta Platforms, Apple, and Amazon.com experiencing dips. Despite cutting its 737 delivery forecast, Boeing advanced on sticking to its cash flow goals and beating revenue estimates.
Microsoft reported better-than-expected revenue of $56.5 billion and adjusted earnings per share (EPS) of $2.99, beating analysts' estimates. The company's Intelligent Cloud segment, including Azure, generated $24.3 billion in revenue, surpassing Wall Street's expectations. Microsoft's focus on artificial intelligence (AI) has contributed to its growth, with investments in AI-powered applications and a recent $10 billion investment in OpenAI. The company's acquisition of Activision Blizzard, the largest in its history, positions Microsoft as the third-largest video game company globally.
Shares of Alibaba dropped over 3% after the unexpected resignation of CEO Daniel Zhang from the company's cloud intelligence business. Zhang, who had been with Alibaba for 16 years, will focus on establishing a technology fund with a $1 billion investment from Alibaba. The company plans to spin off its cloud division as a separate entity, following a major restructuring plan earlier this year. Alibaba has been facing challenges including slowing economic growth and increased regulatory scrutiny in China.
Daniel Zhang, the CEO of Alibaba Group, has unexpectedly stepped down from his role in the company's cloud business, just two months after announcing his departure as group CEO and chairman to focus on the cloud unit. Zhang had been concurrently serving in three roles, including heading the group and the cloud intelligence unit. The cloud unit, China's largest cloud provider, is set to be spun off from Alibaba as part of the company's restructuring. Eddie Wu will take charge of the cloud business after Zhang's departure. Alibaba aims to complete the public listing of its cloud unit within the next 12 months.
Oracle's stock rose by 3% after UBS analyst Karl Keirstead upgraded the rating on the stock to Buy from Neutral, highlighting the company's potential in its cloud business and specifically in the field of artificial intelligence.
Alibaba's work communication and collaboration platform, DingTalk, will separate from the company's cloud division and operate as a wholly-owned subsidiary. While the exact timing of the split is unknown, there are no expected impacts on DingTalk's services. DingTalk is not confirmed to pursue its own IPO, contrary to reports. Although structurally separated, DingTalk will continue to work closely with Alibaba's cloud division in terms of technology. Alibaba's cloud division is also working towards its own public listing, with plans for an IPO by May next year.
