Apple’s Record Revenue, Amazon’s Cautious Guidance
The morning stock market is showing a positive trend, with S&P 500 futures up 20 points, Nasdaq 100 futures up 50 points, and Dow Jones Industrial Average futures up 174 points. Despite negative reactions to earnings from Apple (AAPL, Financial) and Amazon (AMZN, Financial), the overall sentiment is optimistic.
This upbeat mood is partly due to growing optimism around the trade discussions between the U.S. and China. China’s Commerce Ministry noted that the U.S. is eager to start talks, and China is considering this offer.
Investors are also awaiting the upcoming April Employment Situation Report, which might influence market sentiment after its release at 8:30 ET.
Treasury yields have seen minimal changes. The 10-year yield decreased by one basis point to 4.22%, while the 2-year yield increased by one basis point to 3.71%.
Today’s News
Apple Inc. (AAPL, Financial) reported a robust second quarter, with revenue reaching $95.4 billion, marking a 5% year-over-year increase. This growth was driven by record services performance and strong product sales, including the launch of the iPhone 16e. CEO Tim Cook announced a significant investment plan of $500 billion over the next four years in the U.S., which includes expanding facilities and establishing a new factory in Texas. The company’s gross margin was notably high at 47.1%, contributing to a net income of $24.8 billion. Apple anticipates continued revenue growth in the upcoming quarter.
Amazon (AMZN, Financial) experienced a decline in early trading despite exceeding Q1 expectations for revenue, EPS, and operating income. The company issued cautious guidance for the current quarter, although analysts remain optimistic about Amazon’s strategies, including inventory management and market share gains. J.P. Morgan maintained an Overweight rating on Amazon, setting a price target of $225, while Morgan Stanley highlighted the company’s focus on building a leading platform.
Nvidia’s (NVDA, Financial) CEO Jensen Huang engaged with U.S. lawmakers to discuss concerns over Huawei Technologies’ advancements in AI. The discussions focused on the competitive threat posed by Huawei’s AI chips, especially in light of U.S. restrictions on Nvidia’s products in China. Huang emphasized the need for U.S. leadership in AI, suggesting that innovation will continue globally, with or without U.S. tech dominance.
Exxon Mobil (XOM, Financial) reported better-than-expected Q1 earnings, driven by increased production in Guyana and the Permian Basin. Despite flat revenues compared to the previous year, Exxon saw a rise in upstream earnings due to strategic asset utilization. However, refining profits declined due to lower margins and higher expenses. The company declared a quarterly dividend of $0.99 per share.
Atlassian (TEAM, Financial) saw a significant drop in its share price following its Q3 results and cautious Q4 outlook. Despite the mixed performance, analysts remain positive about the company’s product traction and competitive positioning. Jefferies maintained a Buy rating, citing strong gross margins and a positive cash flow outlook as key strengths.
Take-Two Interactive (TTWO, Financial) shares fell sharply after announcing a delay in the release of Grand Theft Auto VI. The game, now scheduled for May 2026, has generated significant interest and anticipation. The company expressed its commitment to meeting high expectations, despite the extended timeline for the game’s completion.
Chevron (CVX, Financial) declared a quarterly dividend of $1.71 per share, maintaining its forward yield. The company’s recent earnings cycle showed a slight beat in EPS but missed revenue expectations. Chevron continues to focus on strategic growth, with upcoming hearings related to its deal with Hess.
The U.S. labor market showed stronger-than-expected performance in April, with nonfarm payrolls increasing by 177K, surpassing the consensus estimate. The unemployment rate remained steady at 4.2%. These figures contributed to positive sentiment in stock index futures, which rose significantly on Friday.