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Amazon and Apple’s Share Prices React to Earnings

Maria Gregoriou
Maria Gregoriou
07 August 2023

As we all awaited August 3rd's market close for the big A’s (Amazon and Apple) to report their quarterly earnings, many were pleased by the results, but what shocked many was Amazon’s breakdown.

Continue reading to get the latest in reports of each company and on how stock prices moved following the news. 

Day of Earnings Announcements

Thursday, August 4 was a big day for all investors who know how important financial information is for their trades, as big tech companies Amazon (AMZN) and Apple (AAPL) both released their highly awaited quarterly reports. In fact, Apple’s report was so anticipated that its financial results were announced via a conference call streamed live for all.  

Good news for many, they both beat expectations! Amazon was the stronger of the two when it comes to earnings and had a more upbeat outlook on the quarter, while Apple showed a record in services, but a slide in sales. In extended trading after the news on Thursday, Amazon’s shares surged while Apple took a minor fall.

Amazon beat Wall Street expectations with rise in sales growth and profit

Amazon.com Inc. second quarter report put its sales of cloud and advertising in focus – its AWS cloud-computing business grew 12% year-over-year to $22.1 billion and its advertising was up by 22% to reach $19.68 billion.

Amazon's recent news about its substantial investments and efforts in generating AI applications to enhance the customer experience has also generated significant hype around the company's name.

According to the report the company’s revenue was at $134.4 billion from $121.2 billion in the same quarter of 2022. Its earnings per share (EPS) came in at $0.65, up from expectations of $0.35. This means it saw a profit of $6.7 billion, much better than the loss of $2 billion a year ago.

Commenting on the company’s operating income increase to $7.7 billion compared to $3.3 billion in the previous quarter, the company’s Chief Executive Andy Jassy said, “We continued lowering our cost to serve in our fulfilment network, while also providing Prime customers with the fastest delivery speeds we’ve ever recorded. Our AWS growth stabilized as customers started shifting from cost optimization to new workload deployment.”.

Its shares rose 8.7% in after-hours trading on Thursday after the release of the report.

Apple’s services are sailing but sales expected to slump further

Companies often kill off their own products with the release of their newer, upgraded ones. Apple obviously knows this, and this is why the people behind the company are very aware that customers have been holding off buying their products until the release of the Apple iPhone 15 series, reportedly on September 13. Tech consumers have also been waiting for the Vision Pro mixed-reality headset to come to market since its announcement in June.

On Thursday, August 3, the world’s largest technology company by revenue, said its sales slipped 1.4% to $81.8 billion for the quarter ending July 1. Analysts expected sales to come in at $81.69. It also forecasts a continued slump in sales for the current quarter. This brought its share price down by around 2%.

On the upside, its earnings per share for the quarter rose 5% year over year to $1.26, which was way above analysts' expectations of $1.19 per share. The real star of the report was sales, which saw a revenue of $21.21 billion, compared to analyst estimates of $20.76 billion.  

From a report in the Newsroom of the Apple website, the company's CEO Time Cook, said “we are happy to report that we had an all-time revenue record in Services during the June quarter, driven by over 1 billion paid subscriptions, and we saw continued strength in emerging markets thanks to robust sales of iPhone.”  

Amazon (AMZN) and Apple’s (AAPL) Quarterly Earnings Breakdown

View the breakdown of Amazon and Apple’s quarterly earnings releases compared to what analysts predicted.  

Amazon (AMZN) Q2 Stats 

 Estimated Actual Results 
Earnings per Share (EPS)$0.35 $0.65 
Revenue $131.5B $134.4B 

Other key data released: 

 Estimated Actual Results 
Amazon Web Services (AWS) Net Sales $21.71B  $22.14
Advertising$10.4B  $10.7B 

Reference CNBC & Amazon

Apple (AAPLE) Q3 Stats 

 Estimated Actual Results 
Earnings per Share (EPS) $1.19 $1.26 
Revenue$81.69B $81.8B 
Gross Margin 44.5% 44.2% 

Other key data released:

 Estimated Actual Results 
iPhone Revenue $39.91B $39.67B
iPad $6.41B $5.79B 
Other Products$8.39B $8.28B 
Services $20.76B $21.21B 

Reference CNBC & Apple

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Apple quarterly earnings breakdown of Net Sales over the years. CNBC.

How to Trade Amazon (AMZN) and Apple (AAPL)  

Follow the steps below to make any of the publicly traded value brands part of your portfolio.

1. Log in to your CAPEX account.

2. Be sure your account is already funded with our flexible payment options.

3. At the top right you can see the type of account you are in.  

4. Go to the search icon at the top left of your WebTrader and enter Amazon or Apple, depending on which company you want to trade.

5. Select the instrument.

6. Enter the amount you wish and select the asset of your choice.

7. That’s it! If your transaction was successful, you will be notified.

Summary

  • Amazon shocked many with earnings over expectations.
  • Amazon reported a boost in revenue to $134.4B.
  • Amazon’s AWS sector had the most surprising jump generating $22.1B
  • The share price of Amazon rose 8.7% in after-hours trading.
  • Apple showed strong earnings as well with its Services sector leading the way with 8% growth.
  • Apple customers are awaiting the release of iPhone 15 and its Vision Pro mixed-reality headset.
  • The share price of Apple dropped by 2% after the release of the report. 

 

The information presented herein is prepared by capex.com/ae and does not intend to constitute Investment Advice. The information herein is provided as a general marketing communication for information purposes only.Users/readers should not rely solely on the information presented herewith and should do their own research/analysis by also reading the actual underlying research. The content herewith is generic and does not take into consideration individual personal circumstances, investment experience, or current financial situation. 

Key Way Markets Ltd shall not accept any responsibility for any losses of traders due to the use and the content of the information presented herein. Past performance and forecasts are not reliable indicators of future results.

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Maria Gregoriou
Maria Gregoriou
Financial Writer

Maria Gregoriou writes marketing content to excite traders and for CAPEX.com. Maria has over 25 years of experience in professional writing, from technical writing to journalism and marketing, both in-house and on a freelance basis. On the personal side, she writes poetry and short stories for children. Over the past five years, Maria has been working in the financial sector where she has been creating marketing copy, editing content, and preparing material to go live. She was also given the chance to mentor other writers along the way.