Big Tech Earnings Roundup

Amazon.com was the last of the Big Tech companies to report this evening, and it added an exclamation mark to a remarkable quarter for the five most-valuable companies on the market. Google-parent Alphabet, Microsoft, Apple, Facebook, and Amazon roughly doubled their combined profits and added nearly $100 billion in revenue from the same quarter a year ago.

With businesses like cloud computing, e-commerce, digital advertising, and top-of-the-line smartphones and computers, the five might as well have been made for a pandemic. No wonder their stocks have returned between 60% and 90% since the start of 2020.

Here are the key points from each company's big results:

Alphabet
What was reported: $17.9 billion in net income, or $26.29 in earnings per share (up 166%), on $55.3 billion in revenue (up 34%)
What was expected: $15.64 in earnings per share and $51.7 billion in revenue
The good: Profits nearly doubled expectations. Online advertising is back, after companies had pulled back earlier in the pandemic.
The bad: Google Cloud revenues only just met expectations, and the segment continues to lose money. An accounting change and gain on investments added nearly $5 billion in profits on paper only.
The stock reaction: Alphabet stock jumped 3% on Wednesday.

Amazon
What was reported: $8.1 billion in net income, or $15.79 in earnings per share (up 215%), on $108.5 billion in revenue (up 44%)
What was expected: $9.54 in earnings per share and $104.5 billion in revenue
The good: Online shopping continues to boom, and Amazon's guidance is for another strong quarter ahead. Cloud computing and advertising revenues soared.
The bad: Amazon expects Covid-19-related costs of $1.5 billion in the second quarter. Physical stores sales were down 16% because of the pandemic.
The stock reaction: Amazon stock was up about 3% in after-hours trading Thursday.

Apple
What was reported: $23.6 billion in net income, or $1.40 in earnings per share (up 120%), on $89.6 billion in revenue (up 54%)
What was expected: 99 cents in earnings per share on $77.1 billion in revenue
The good: Apple had record revenue in each geographic segment and double-digit growth in each product category. And it raised its dividend by 7% and added $90 billion to its share-buyback program.
The bad: Apple didn't issue revenue guidance because of Covid-related uncertainties. Management warned that the chip shortage would begin to have a negative impact.
The stock reaction: Apple stock slipped 0.1% on Thursday.

Facebook
What was reported: $9.5 billion in net income, or $3.30 in earnings per share (up 93%), on $26.2 billion in revenue (up 48%)
What was expected: $2.35 in earnings per share on $23.7 billion in revenue
The good: Like at Alphabet, Facebook saw a rebound in advertising revenue. The company also grew its user base faster than expected. Around the world, 3.45 billion people now use at least one of Facebook’s apps every month.
The bad: The company expects revenue growth in the second half of the year to slow. Changes to ad-targeting in Apple's iOS software launched Monday. And regulatory issues, and changes to Apple ‘s (AAPL) iOS update which launched Monday. 
The stock reaction: Facebook stock soared 7.3% on Thursday.

Microsoft
What was reported: $14.8 billion in net income, or $1.95 in earnings per share (up 39%), on $41.7 billion in revenue (up 19%)
What was expected: $1.78 in earnings per share on $41.0 billion in revenue
The good: Microsoft had double-digit growth at all three of its business segments. Next-quarter revenue guidance for all three was above consensus estimates.
The bad: Azure cloud computing growth slowed slightly from last quarter, but still grew 46% on a currency-adjusted basis. Microsoft stock was up 11% in the month before the report, so a big beat may have been priced in.
The stock reaction: Microsoft stock fell 2.8% on Wednesday.