What Apple and Amazon said after Thursday hours

The stock market made a very strong recovery on Thursday, as investors seemed to decide that the selling pressures that financial markets have faced over the past several weeks have been overcome. Gains for major market indices ranged from less than 2% to Dow Jones Industrial Average (^ DJI -1.58%) to more than 3% for Nasdaq Composite (^ IXIC -2.64%)with the Standard & Poor’s 500 (^ GSPC -2.29%) Mid drop.

index

Change in daily percentage

Change daily points

daw

+ 1.85%

+614

Standard & Poor’s 500

+ 2.47%

+104

Nasdaq

+ 3.06%

+383

Data source: Yahoo! finance.

As has been the case all week, most investors paid more attention to the news coming out of the post-close trading session. in the late afternoon, apple (AAPL -2.22%) And Amazon.com (AMZN -13.73%) It was among the companies reporting their most recent financial results, and Tech Neighbors was a leading indicator of what investors should expect in Friday’s stock market session and for much of 2022.

Image source: Getty Images.

Apple keeps records

Apple shares are down just over 1% in after-hours trading, paring a portion of the stock’s 4% gain during the regular trading session. The company’s recent quarterly results showed continued success for the business overall, although some weaknesses gave some shareholders some concern about what the future could bring.

Apple’s results for the second fiscal quarter ended March 26 showed strong growth. Revenue rose 9% year over year to $97.3 billion, a record for this part of a calendar year. Net income rose a more modest 6% to $25.01 billion, which turned into earnings of $1.52 per share.

Apple’s various businesses have experienced varying degrees of growth. On the services side, revenue was 17% higher at $19.8 billion, but that was a bit slower than what Apple has seen in recent quarters. Meanwhile, product sales were up nearly 7% year-over-year. Gross margin improved, but a 19% rise in operating expenses kept net profit gains somewhat in check.

Apple cited the iPhone and Mac segments, as well as the wearables, home appliances, and accessories business as standing out, leaving the iPad as a potential hindrance to the results. However, with many fearing Apple could do much worse, shareholders took the news relatively well, and a 5% dividend increase and $90 billion new stock buyback plan was great for investors.

Amazon is giving up Earth

Amazon.com stocks haven’t done nearly as well. The stock fell more than 12% in after-hours trading following the release of its first-quarter financials.

Figures from Amazon told the story. Net sales rose 7% to $116.4 billion, even after accounting for two percentage points of currency impacts. However, operating income is significantly lower than last year’s levels, falling from $8.9 billion a year ago to just $3.7 billion in this year’s period. Moreover, a huge cost is associated with the depreciation of Amazon properties in Rivian Cars (countryside -4.26%) The shares caused Amazon to lose $3.8 billion in the quarter, or $7.56 per share.

Amazon slides said very different pictures. North American retail saw big gains in sales, but the biggest jump in operating expenses caused Amazon to lose money based on operating there. International sales were actually lower year on year, which dealt the same blow. However, Amazon Web Services remained solid earnings, with segment revenue up 37% and segment operating income up 57% from last year’s levels.

Investors also weren’t comfortable with Amazon’s second-quarter guidance, which included revenue forecasts of $116 billion to $121 billion and calls for operating results between a $1 billion loss and a $3 billion profit. With so much uncertainty and slow growth, Amazon is finally seeing the expected slowdown after a period of very steep sales and profit gains during the early years of the COVID-19 pandemic.

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