Stock Market Futures Gain Early Morning Wednesday
U.S. stock futures are in the green in early morning trading on Wednesday. Surprisingly, this follows a rally day for the stock market on Tuesday after companies started reporting their quarterly figures. Among the major names that reported earnings yesterday would be IBM (NYSE: IBM) and Netflix (NASDAQ: NFLX).
On one hand, shares of IBM stock closed Tuesday’s trading session down over 5%. This comes after the tech company reported its second-quarter earnings results earlier this week. In the report, the company beat Wall Street’s revenue and earnings estimates of $15.54B vs $15.18B and $2.31 per share, vs $2.27 per share.
However, the company fell short of its forecast for cash flow. The management team from IBM stated it now projects $10 billion in free cash flow, which is a decline from its previous range of $10 billion to $10.5 billion they reported in April. This could be due to a strong U.S. dollar and the company stopping all business operations in Russia.
Presenting some further insight into all, this is IBM CEO Arvind Krishna. He explains, “In the quarter we delivered good revenue performance with balanced growth across our geographies, driven by client demand for our hybrid cloud and AI offerings. The IBM team executed our strategy well,” he continued, “With our first half results, we continue to expect full-year revenue growth at the high end of our mid-single digit model.”
There is plenty of stock market news for investors to watch for today. As of 5:14 a.m. ET, the Dow, S&P 500, and Nasdaq futures are trading higher by 0.14%, 0.18%, and 0.29% respectively.
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Netflix Jumps Following Release Of Its Quarterly Earnings Report
Among the potential head-turners in the stock market, today would be video streaming giant Netflix. The company reported its fiscal second-quarter earnings on Tuesday after market close. This comes on the heels of the company battling persistent inflationary pressures, increased competition, and an increase in subscriber churn.
Netflix’s subscriber numbers for the quarter reported a narrower loss than expected, resulting in shares of NFLX stock jumping more than 8% in after-hours trading on Tuesday. Revenue and adjusted earnings per share were mixed among the broader subscriber slowdown, in addition to heightened pressures from foreign exchange with the dollar holding its strength relative to other currencies around the world.
Let’s take a look at how Netflix’s second-quarter results compared to Wall Street’s estimates:
- Revenue: $7.97 billion VS. $8.05 billion projected
- Adj. Earnings Per Share (EPS): $3.20 VS. $2.98 projected
- Subscribers: Loss of 970,000 VS. loss of 2 million users projected
Netflix co-CEO Reed Hastings had this to say in his letter to shareholders, “Q2 was better than expected on membership growth, and foreign exchange was worse-than-expected (stronger US dollar), resulting in 9% revenue growth (13% constant currency). Our challenge and opportunity is to accelerate our revenue and membership growth by continuing to improve our product, content, and marketing as we’ve done for the last 25 years, and to better monetize our big audience. We’re in a position of strength given our $30 billion-plus in revenue, $6 billion in operating profit last year, growing free cash flow, and a strong balance sheet.“
All in all, with such news, it would make sense then that investors would be turning their attention towards NFLX stock. Will you be keeping NFLX stock on your watchlist today?
Other top notable companies are set to report their second quarter fiscal earnings today. They are:
- Tesla, Inc. (NASDAQ: TSLA)
- ASML Holding N.V. (NASDAQ: ASML)
- Abbott Laboratories (NYSE: ABT)
- Biogen, Inc. (NASDAQ: BIIB)
- M&T Bank Corp. (NYSE: MTB)
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