Top earnings to watch out this week: PATH, NIO, GME, ZS, and KR

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Top earnings to watch out this week: PATH, NIO, GME, ZS, and KR

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 Top earnings to watch out this week: PATH, NIO, GME, ZS, and KR
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Highlights:

  • US indices marked their worst monthly performance in August in the last seven years.
  • NIO Inc. (NYSE: NIO) delivered 10,677 vehicles in August.
  • Kroger Company (NYSE: KR) stock returned gains of over eight per cent YTD.

UiPath, Inc. (NYSE: PATH), NIO Inc. (NYSE: NIO), GameStop Corporation (NYSE: GME), Zscaler, Inc. (NASDAQ: ZS), and Kroger Company (NYSE: KR) are among the leading firms to report their earnings this week. The companies are also among the significant players in their respective sectors.

The US indices have marked their worst monthly performance in August in the last seven months, over concerns of higher interest rates, elevated inflation, and other global macroeconomic headwinds.

However, investors seemed to be optimistic at the start of the ongoing quarter, buoyed by the strong second-quarter earnings season. They anticipated a gloomy corporate second-quarter earnings season due to the impact of higher costs and cooling consumer demands.

Additionally, the contraction of GDP also raised concerns over a potential recession in the US economy. However, the companies have surprised the market, while posting strong quarterly financial results.

Now, the investors would keep a close watch on the upcoming earnings in September, which may lift their sentiments. So, let's revisit the previous quarter's earnings and the recent stock performance of the companies that are due to report this week:

UiPath, Inc. (NYSE: PATH)

UiPath is a software technology firm that specializes in robotic automation software. The stock of the company hasn't witnessed a smooth journey so far in 2022 in the wake of a number of macroeconomic factors.

The PATH stock slipped over 74 per cent year-over-year (YoY) while decreasing about 63 per cent this year. In the running quarter, its price tumbled over 14 per cent.

The stocks traded below 75 per cent from its 52-week high of US$ 65 noted on September 7, 2021, while its 52-week low of 13.66 was noted on May 12, 2022. At the time of writing, it traded about 14 per cent above its 52-week low.

UiPath had an RSI of about 34, according to Refinitiv data. As per some analysts, the 30 to 50 range of the Relative Strength Index (RSI) suggests that the stock is in a highly volatile state.

The US$ 8.59 billion market cap firm would report its second quarter fiscal 2023 financial results on Tuesday, September 6, after the market close.

Meanwhile, in the first quarter of fiscal 2023, the New York-based firm noted a 32 per cent jump in its total revenue of US$ 245.06 million. In the starting quarter of fiscal 2022, its total revenue was US$ 186.21 million.

Its net loss also improved to US$ 122.56 million in Q1 FY23, from a loss of US$ 239.66 million in the same quarter of the prior year.

During its first-quarter earnings release, the company said that it expects its revenue to be between US$ 1.08 billion and US$ 1.09 billion in fiscal 2023. For the latest quarter, it provided revenue guidance of US$ 229 million to US$ 231 million.

NIO Inc. (NYSE: NIO)

Nio is a Chinese automotive firm that specializes in the electric vehicle segment. The geopolitical turmoil and several other negative catalysts have dragged the stock of the firm in recent months.

The NIO stock fell over 52 per cent in the last 12 months, while dropping over 41 per cent year-to-date (YTD). In the running quarter, its price fell over 14 per cent.

The stock of the Chinese firm hit its 52-week high of US$ 44.27 on November 8, 2021, while touching a 52-week low of US$ 11.67 on May 12, 2022. It had an RSI of 40, Refinitiv data showed.

The US$ 31.05 billion market cap company is likely to release its fiscal 2022 second-quarter earnings results on Wednesday, September 7, before the opening bell.

Meanwhile, the Shanghai, China-based company posted revenue of RMB 9.91 billion or US$ 1.56 billion in Q1 FY22, representing a rise of 24.2 per cent from the same quarter of previous year and 0.1 per cent surge from the prior quarter.

However, its net loss declined to RMB 1.78 billion in the first quarter of fiscal 2022, from a loss of RMB 451 million in the year-ago period. In the starting quarter of this year, the firm delivered a total of 25,768 vehicles.

Nio provided its delivery update for August, which showed the firm had delivered 10,677 vehicles in the month, noting a surge of 81.6 per cent YoY. On a YTD basis, it delivered a total of 71,556 vehicles, an increase of 28.3 per cent YoY.

GameStop Corporation (NYSE: GME)

The stock of the popular meme-stock, GameStop, lost around 48 per cent YoY while decreasing about 26 per cent YTD and nearly 11 per cent quarter-to-date (QTD).

GameStop had an RSI of about 30, Refinitiv data showed. The video game and electronics retail firm is likely to release its latest quarterly earnings results on September 7, 2022.

The net sales of the Grapevine, Texas-based firm were US$ 1.37 billion in Q1 FY22, compared to US$ 1.27 billion in Q1 FY21. Its net loss totaled US$ 157.9 million in the first quarter of fiscal 2022 versus a loss of US$ 66.8 million in Q2 FY21.

GameStop Corporation first quarter fiscal 2022 earnings highlightsSource: ©Kalkine Media®; © Canva Creative Studio via Canva.com

Zscaler, Inc. (NASDAQ: ZS)

The stock of the cloud security firm, Zscaler, fell over 48 per cent YoY while decreasing more than 55 per cent YTD and four per cent QTD. The US$ 20.41 billion market cap company had an RSI of 33, as per Refinitiv data.

The company would release its fourth quarter of fiscal 2022 earnings results on September 8.

In Q3 FY22, its revenue grew 63 per cent YoY to US$ 286.8 million. Zscaler's GAAP net loss was US$ 101.4 million in Q3 FY22, versus a loss of US$ 58.5 million in Q3 FY21.

Kroger Company (NYSE: KR)

Unlike the above-mentioned four companies, the KR stock showed gains of seven per cent YoY, while adding over eight per cent YTD and 3 per cent QTD. Its RSI was about 55, Refinitiv data showed, which suggests the stock could be in a neutral state.

The retail company is scheduled to make its latest quarter earnings announcement on September 9, before the opening of the market.

Kroger's total sales were US$ 44.66 billion in Q1 FY22, compared to US$ 41.29 billion in the year-ago quarter. The attributable net earnings of the Cincinnati, Ohio-based company were US$ 664 million in Q1 FY22, up from US$ 140 million in Q1 FY21.

Bottom line:

The market appeared to be recovering from the downtrend noted in the first half of the year. However, comments from Fed Chair Jerome Powell at the end of the central bank's annual symposium in Jackson Hole, Wyo, had again triggered fears of the investors.

According to Mr. Powell, the central bank will keep the monetary support tightened "for some time" to tackle inflation. In addition, comments from other Fed officials in the prior week had also weighed on the market sentiments.

The officials backed rate hikes, saying that it is not yet confirmed that the inflation has already peaked.

The S&P 500 index slipped about 12 per cent YoY while dropping around 17 per cent YTD. Although it showed gains of around four per cent in the running quarter, it declined about the same per cent in August.

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