๐ PRO: This Week in Visuals
AAPL, META, MA, PG, MRK, AMD, TMUS, QCOM, MCD, PFE, ARM, INTC, BKNG, LRCX, BA, ANET, SBUX, MELI, RACE, MAR, PYPL, COIN, TEAM, KHC, EA, SQ, PINS, SNAP, MTCH, PAYC, ROKU, SOFI, ETSY, TDOC, TLRY
Welcome to the Saturday PRO edition of How They Make Money.
Over 130,000 subscribers turn to us for business and investment insights.
In case you missed it:
Our PRO coverage includes timely updates on the big earnings of the past week.
๐ง Free subscribers get our Friday articles and sneak peeks.
๐ Premium subscribers get:
Tuesday articles.
Access to our archive.
Monthly reports with 200+ companies covered.
๐ผ PRO members get all of the above, plus our Saturday timely coverage.
Today at a glance:
๐ฑApple: Services Shine
โพ๏ธ Meta: AI Spending Incoming
๐ณ Mastercard: New Partnerships
๐งด Procter & Gamble: Price Hikes
๐ Merck: Outlook Revision
โ๏ธ AMD: AI Chip Surge
๐ T-Mobile: FCF Expansion
๐ฒ Qualcomm: Smartphone Recovery
๐ McDonald: Rare Decline
๐ Pfizer: Paxlovid Raise
โ๏ธ AMR Holdings: Lukewarm Forecast
๐งโ๐ป Intel: Massive Restructuring
๐๏ธ Booking: Soft Nights Growth
๐ง Lam Research: China Risk
๐ฉ๏ธ Boeing: New Leadership
๐ช๐บ Airbus: Space Challenges
๐ Arista Networks: Etherlink Optimism
โ๏ธ Starbucks: Ongoing Turnaround
๐ค MercadoLibre: Soaring Profits
๐๏ธ Ferrari: Leveraging Customization
๐จ Marriott: Weaker Demand
๐ณ Paypal: Transaction Beat
๐ Coinbase: Bipartisan Support
โ๏ธ Atlassian: Sales Transition
๐ญ Kraft Heinz: Lower Volume
๐ซ Hershey: Profit Decline
๐ฎ Electronic Arts: Bookings Drop
๐พ Roblox: CFO Departure
๐ต Block: Bottom Line Focus
๐ค Live Nation: Strong Attendance
๐ Pinterest: Muted Guidance
๐ป Snap: Guidance Falls Short
๐ฅ Match Group: Tinder Slowdown
๐ป Paycom: Buyback Incoming
๐บ Roku: Gaining Streaming Share
๐ฆ SoFi: Revenue Shift
๐ฆ Etsy: GMS Keeps Sliding
๐งโโ๏ธ Teladoc: Struggling BetterHelp
๐ฟ Tilray: Craft Beer Boost
๐ฝ๏ธ Olo: Growth Acceleration
1. ๐ฑApple: Services Shine
Apple (AAPL)'s iPhone sales have declined for the second consecutive quarter, with a 1% drop in Q3 FY24 (June quarter). However, overall revenue grew by 5% to $85.8 billion ($1.4 billion beat), and earnings exceeded Wall Street expectations. The high-margin Services drove the outperformance, hitting a record revenue of $24.2 billion, a 14% year-over-year jump. Services made up 45% of Appleโs gross profit.
Investors hope the upcoming Apple Intelligence AI features, set to be released in the fall, will reignite iPhone sales. Apple is betting on AI to spur upgrades, especially in China, where sales have lagged. While the initial rollout of AI features has been delayed, analysts believe the new tools could still give iPhone sales a much-needed boost. With many customers due for an upgrade, Apple's AI gamble may just pay off.
2. โพ๏ธ Meta: AI Spending Incoming
Meta (META)'s Q2 earnings report revealed aggressive AI spending plans for FY25. This strategy follows similar announcements from hyperscalers. Meta's stock soared anyway. This surge is attributed to better-than-expected revenue, with a 22% year-over-year increase in advertising revenue to $38.3 billion, outperforming Google Search and Amazon Advertising.
Despite losses at Reality Labs expanding to $4.5 billion, the company's year of efficiency is paying off, with increased revenue per employee and controlled headcount growth. The monetization of its AI offerings could take time to materialize, but AI is already proving to be a powerful tool for improving engagement and ad performanceโMeta's core business.