The S&P 500 closed flat on Wednesday as markets awaited Nvidia's earnings report. Target shares plummeted 21.4% after missing quarterly estimates due to cautious consumer spending, while Keysight Technologies surged 8.8% on strong earnings driven by AI investments. Humana and CoStar Group also saw significant gains, while Qualcomm shares fell 6.3% amid concerns over its growth outside smartphones. Major indexes showed mixed results, with the Dow gaining 0.3% and the Nasdaq dropping 0.1%.
Microsoft shares reach a record high as OpenAI employees threaten to join former CEO Sam Altman at Microsoft if OpenAI's remaining board members do not resign and bring Altman back; Zoom reports better-than-expected earnings on improved growth from larger customers; Baidu beats expectations as it expands into artificial intelligence; Keysight Technologies reports earnings and revenue beat; existing home sales data and FOMC minutes are due for release.
Keysight Technologies, Inc. (NYSE:KEYS) reported solid Q3 2023 earnings, beating expectations with an EPS of $2.19 compared to the expected $2.04. While orders came in at the low end of expectations, the company saw positive customer R&D spending and stability in commercial communications. However, there was softness in the Electronic Industrial Solutions Group (EISG) and Asia due to manufacturing-related spending deferrals. Despite near-term challenges, Keysight remains confident in its diversified business, differentiated solutions, and durable operating model to capitalize on long-term growth trends. The company expects full-year EPS growth of 7% and 1% revenue growth.
Keysight Technologies' stock is plummeting after the company's Q3 results, which showed sales in line with expectations and earnings that beat estimates. However, the company's forward guidance disappointed investors, leading to a downgrade by an analyst at Barclays. Keysight's stock is now down approximately 22% year to date and is valued at 16.4 times this year's expected earnings and 4.3 times expected sales.
Applied Materials and Ross Stores saw their stocks rise in after-hours trading after beating analysts' expectations in their quarterly results. Bill Holdings reported better-than-expected earnings but issued a weak outlook for the next quarter. Keysight Technologies provided a bleak forecast for its fiscal fourth quarter, causing its shares to drop. Farfetch experienced a significant decline in its stock price after posting second-quarter revenue that missed estimates.
Keysight Technologies shares dropped nearly 3% after Bank of America downgraded the company due to cooling 5G demand. The analyst cited expectations of a greater-than-expected decline in third-quarter orders, potentially extending into fiscal 2024. Peers in the industry have also experienced significant order declines. Despite ongoing investment in new 5G use cases, the macro backdrop is likely to limit EPS growth. Keysight's recent acquisition of ESI Group is seen as consistent with its strategy, although slightly dilutive to adjusted earnings per share in fiscal 2024.
