Kalkine Media tracks five big earnings from last week

Highlights:

• Goldman Sachs Group, Inc. (NYSE:GS) noted a 12 per cent drop in its Q3 FY22 revenue.
• The total vehicle deliveries of Tesla, Inc. (NASDAQ:TSLA) rose 42 per cent YoY in Q3 FY22.
• Revenue of The Travelers Companies, Inc. (NYSE:TRV) rose six per cent YoY in Q3 FY22.

The earnings and positive guidance from a flurry of companies seem to have boosted the investors' confidence last week while triggering a two-day rally on the starting two days of the previous week.

However, all three indices have snapped their winning streak, as hawkish comments from the policymakers and concerns over a potential recession have offset the optimism over the earnings.

Many big companies, including Goldman Sachs Group, Inc. (NYSE: GS), Tesla, Inc. (NASDAQ: TSLA), International Business Machines Corporation (NYSE: IBM), The Travelers Companies, Inc. (NYSE: TRV), and AT&T Inc. (NYSE: T), reported last week. These are also popular players in their respective segments.

Investors previously anticipated a significant hit to the profit of the corporations due to the hovering uncertainties in the market, especially after the inflation data of September, which showed that the core inflation has advanced at its highest pace since 1982.

But the earnings have somehow seemed to have come better than previously expected. The surge in the policy rates by the global central banks in their fight against soaring costs has hampered the upward trend in the market as seen in 2021. In addition, the geopolitical turmoil has also contributed to the losses in 2022.

Now, let's revisit the earnings from last week and see how they have performed amid a turbulent scenario in the equity market.

Goldman Sachs Group, Inc. (NYSE:GS)

The American multinational investment banking and financial services firm Goldman Sachs Group, holds a dividend yield of 3.19 per cent. The US$ 106.09 billion market cap firm, which provides securities, investment management, and other related services, reported its Q3 FY22 earnings results on October 18.

The banking firm's revenue plummeted 12 per cent YoY to US$ 11.97 billion in Q3 FY22, while its net earnings declined 43 per cent YoY to US$ 3.06 billion in the period. From the preceding quarter, Goldman 'Sachs' total revenue rose one per cent in Q3 FY22, while its net earnings noted a growth of five per cent QoQ.

The GS stock plunged over 18 per cent YTD and 23 per cent YoY. In the running month, its price was up over six per cent through October 21.

Tesla, Inc. (NASDAQ:TSLA)

The EV-maker, which also engages in other automotive and clean energy operations, Tesla, Inc holds a P/E ratio of 64.04. The US$ 643.95 billion market cap company that designs and manufactures EVs, battery energy storage solutions, and other related products, reported its earnings on October 19, after the closing bell of Wall Street.

According to its earnings release, Tesla's total revenue rose 56 per cent YoY to US$ 21.45 billion in Q3 FY22, while its GAAP net earnings available to shareholders rose 103 per cent YoY to US$ 3.29 billion. According to the statement, its automotive revenue rose 55 per cent YoY to US$ 18.69 billion in Q3 FY22.

In the third quarter, the EV-maker said that its total production was 365,923 vehicles, representing a jump of 54 per cent YoY, and delivered over 343,830 vehicles, an increase of 42 per cent YoY.

The TSLA stock fell 41 per cent YTD and 28 per cent YoY through October 21, while its 52-week low of US$ 204.16 was noted on October 14.

International Business Machines Corporation (NYSE:IBM)

The major multinational technology firm, International Business Machines Corporation or IBM, holds a dividend yield of 5.39 per cent. The company has operations in over 170 countries, it said.

The trading price of the US$ 115.42 billion market cap technology firm fell about four per cent YTD and five per cent YoY. In the running month through October 21, IBM managed to add around seven per cent.

Exploring its Q3 FY22 earnings results, which came out on October 19, IBM's revenue rose six per cent YoY to US$ 14.1 billion, while its net loss totalled US$ 3.19 billion, compared to an income of US$ 1.13 billion in Q3 FY21. The global hybrid cloud adoption drives the solid growth in all segments' revenue, the company said.

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The Travelers Companies, Inc. (NYSE:TRV)

The insurance firm Travelers Companies, which provides commercial property casualty insurance, personal insurance, and other related services, holds a dividend yield of 2.14 per cent. The US$ 40.54 billion market cap company's stock rose over nine per cent YTD and seven per cent YoY.

Exploring its Q3 FY22 earnings, which came out on October 19, Travelers Companies' revenue rose six per cent YoY to US$ 9.3 billion, and its net income fell 31 per cent YoY to US$ 454 million in the quarter.

AT&T Inc. (NYSE:T)

The telecommunication firm and a leading mobile telephone services provider in the US, AT&T, had a dividend yield of 7.14 per cent. The US$ 118.71 billion market cap communication company's stock dropped by around nine per cent YTD and 14 per cent YoY. Notably, the 52-week low of US$ 14.46 of the mobile telephone services provider was noted on October 13, 2022.

Exploring its Q3 FY22 earnings results, which were released on October 20, the company's revenue fell 4.1 per cent YoY to US$ 30 billion, while its diluted EPS from continuing operations was US$ 0.79 apiece, compared to US$ 0.63 in the year-ago period.

The company's wireless service revenues rose 5.6 per cent YoY, which it said that its best growth in over a decade.

Bottom line:

While some companies have warned investors that high inflation could weigh on their future profits, some have also raised their guidance for the ongoing quarter and annual growth projections.

This week is going to be crucial for the investors as the behemoths from the technology sector, including Microsoft Corporation (NASDAQ:MSFT), Apple, Inc. (NASDAQ: AAPL), Alphabet, Inc. (NASDAQ:GOOG), among others, would be announcing their quarterly earnings results.

These earnings would provide more insights into how the big companies have tackled the increasing costs and other macroeconomic headwinds still hovering over the market.

Last quarter, the second quarter earnings season triggered a summer rally for a short time. This quarter also, the earnings season would play an important role in deciding the market's future path.

But, the investors should also keep an eye on the mounting concerns over a potential recession and jumbo hikes in interest rates by the central bank in the coming times.