U.S. earnings remain strong
It looks more and more likely that companies in North America will start to see their profits decline at some point in the next year or so. By and large though, it doesn’t appear we’re at that point just yet. (All values are in U.S. currency unless otherwise stated.)
Pepsi (PEP/NASDAQ) kicked off the earnings season with a substantial earnings beat, cashing in to the tune of $1.97 in earnings per share (versus $1.84 predicted). Revenues were also strong at $21.97 billion (versus $20.84 billion predicted). Shares were up 4% on Wednesday after the earnings report.
Delta’s earnings (DAL/NYSE) arrived on time, coming at $1.51 per share (versus $1.53 predicted) on $12.84 billion in revenues (versus $12.87 billion predicted). The massive airline credited a strong international demand (specifically to Europe) for its increased profits. Given the increased value of the U.S. dollar versus the euro and the pound, that trend should continue. Delta announced that its pre-pandemic capacity should be fully restored by next summer. Delta stock finished Thursday up 4%.
As the world’s biggest asset manager (at one point managing $10 trillion, or roughly a quarter of the entire planet’s assets), BlackRock’s (BLK/NYSE) financial health is often looked at as a bellwether for the broader economy.
While BlackRock announced a very solid quarter, it did forecast some strong economic headwinds. Earnings per share were $9.55 (versus $7.93 predicted). While the company was obviously happy to announce such a strong earnings report amidst declining expenses, revenues were down 14.6% on a year-over-year basis. Critics will note the value of assets under management slid to $8 trillion (below the $8.3 trillion predicted by analysts). Falling equities markets have evidently taken their toll on Blackrock investors, but management can’t be too worried as they announced more than $375 million in share buybacks for the quarter. Shares were up 6.63% at market close on Thursday after the earnings announcement.
Taiwan semiconductor beats estimates but forecasts a shaky future
Taiwan Semiconductor Manufacturing Company (2330/TWSE) is one of the most unique companies on the planet. (You read that right, 2330 is the ticker. It also trades as an ADR on the NYSE under the ticker TSM.) As the king of semiconductors, this global behemoth supplies the world’s tech heavyweights (ahem, Apple, Intel, Nvidia and Qualcomm) with the chips needed to create hardware.
TSMC isn’t just the biggest chipmaker, it’s pretty much an island, as there isn’t even a real competitor for the company. It’s notable that the third biggest chipmaker, UMC, is also Taiwanese.
TSMC is absolutely dominant when it comes to the most advanced processing techniques. The company has roughly 55% of the global market for contract chip fabrication.
