Earnings reports from major ecommerce, retail players
With earnings season in full swing, investors are anxious to see positive report cards from U.S. companies – partially for the potential those reports can have in wiping away the bad vibes that the government shutdown created. For anyone in the retail or eCommerce industries, that desire couldn’t be more palpable, considering the ripple effect that the government stalemate caused on consumer confidence and therefore, consumer spending.
eBay: On Oct. 17, eBay reported earnings, which are down more than 5%. According to an article on Yahoo Finance, “eBay posted earnings of 64-cents a share, which was a penny better than estimates, but if fell slightly short of the consensus on revenues with sales of $3.89-billion versus $3.91-billion.”
Overstock.com: Despite shares of Overstock.com falling 13 percent, the stock is up 88 percent so far this year. And, With 18 percent revenue growth and $3.5 million in net income reported, Chairman and CEO Patrick Byrne attributes much of the company’s success to Club O, which he described as “what we believe is the best, most generous loyalty program on the Internet, with free shipping, 5-25% rewards on products, and books priced at Amazon prices but with 15% rewards, all for $19.95 per year. Our Club O customers are rewarding us with their business. In addition, with the opening of our new warehouse in Pennsylvania, we are now providing even faster delivery to our customers on the east coast."
Ascena Group: Representing retail players like Lane Bryant, Dress Barn and Maurices, Ascena serves as a good example of how retail in girls’ and women’s apparel is faring. Its last earnings report in late September beat estimates with operations increases of 17.2 percent year over year.
Amazon: Although Amazon won’t report until Oct. 24, word on the street is that JPMorgan Chase & Co. is expecting results in line with the upper half of the company’s guidance. This is according to ValueWalk.com, which also said that JPMorgan is looking for “$16.7 billion in revenue, compared to guidance of $15.45 billion to $17.15 billion for the third quarter. They expect guidance of $24 billion to $27 billion for the fourth quarter, and they have estimated for revenue of $26 billion for that quarter.”
Costco: Despite missing investor expectations, Costco’s profits rose to “$617 million from $609 million in the year-ago period,” reported Fox Business. “On a per-share basis, earnings ticked a penny higher to $1.40. Revenue edged up 0.8% to $32.49 billion.” Some of its increases can be attributed to cost-conscious shoppers, attempting to stretch their dollars further.
No earnings list could be complete without Google, although it’s a safe assumption that most readers of this blog have already seen the headlines.
Google: With profits of $2.97 billion, shares of Google reached all-time highs, surpassing the $1,000 mark. One interesting item to make note of, however, was its steadily declining cost-per-click numbers. In fact, Investorplace.com warned giddy investors of what could come of “The much-watched “cost-per-click” metric that drives Google ad sales,” which “continued its downward spiral in the third quarter. Google earnings showed CPC numbers dropped 8% compared with last year and 4% quarter-over-quarter.”
“It’s crucial to remember that more than 85% of total revenue right now comes from the advertising business,” Investorplace.com said in regard to Google's overall profits.
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