Tuesday Earnings Recap

Today's highlights included results from three major industrial firms: Caterpillar, 3M, and Raytheon Technologies. Each of them did better than Wall Street expected and all three management teams took a bullish tone. 3M even grew sales compared with the year-ago period.

But all three stocks dropped today: Caterpillar's fell 3.2%, 3M lost 3.1%, and Raytheon dropped 7%. Hard for investors to get excited about an optimistic outlook when they're worrying about a resurgence in Covid cases hitting the unfolding economic recovery. Al Root had a busy morning covering all three reports: Read more about Caterpillar here, 3M here, and Raytheon here.

Also making headlines today was Advanced Micro Devices, which posted third-quarter earnings that more than tripled on sales that nearly doubled from a year ago. But the bigger news from AMD this morning was that it had agreed to purchase Xilinx for $35 billion, in a move to gain scale in the semiconductor business and expand to new types of products.

Max Cherney spoke with AMD CEO Lisa Su today, who called the deal "really transformational." Investors were less excited: AMD stock lost 4.1% today, while Xilinx's surged 8.6%. Read Max's report here.

Other notable reports today came from three major pharmaceutical companies: Merck, Pfizer, and Eli Lilly. Their respective Covid-19 vaccine and treatment efforts overshadowed all three third-quarter reports.

Pfizer is a massive pharma company, with dozens of products on the market and in its pipeline. But its under-trial Covid vaccine in collaboration with the German biotech firm BioNTech has been getting all the attention. There was no news on that front today, and sales and earnings were as expected and about even with a year ago. Pfizer stock closed down 1.3%. Bill Alpert has more here.

Merck beat on the top and bottom lines, and raised its earnings and sales guidance for the full year. Usually a global leader in the vaccine business, Merck is behind competitors in the race to a Covid-19 vaccine. It's left to manage through disrupted supply chains and delayed elective procedures that could weigh on demand for its products.

The stock fell 1.1% today. Teresa Rivas covered Merck's report here.

Finally, Eli Lilly posted a disappointing result: Revenue and earnings both missed estimates, and the company was forced to discount a major drug to boost volumes last quarter. It's not the first time Eli Lilly has had to do that. Its earnings were also weighed down by spending on an experimental antibody treatment for Covid-19. Unfortunately, a study of the treatment was halted yesterday after researchers found that it wasn’t helping patients.

Eli Lilly stock dropped 6.9% today. Read more from Bill here.

The evening earnings highlight came from the third-most valuable company on the market: Microsoft. A boost in demand for cloud computing and video gaming helped push revenues up 12% from a year ago, as earnings per share rose 32%. The numbers are staggeringly large: $37.2 billion in sales in three months, with a net profit margin of 32%.

Hard to complain about that. But investors expected nothing less from Microsoft, and the stock was about flat in after-hours trading. Eric Savitz has more on the results here.

Other earnings reports today came from Akamai, BP, Cummins, Corning, Crocs, Harley Davidson, JetBlue, Polaris, and Xerox.