Tesla Begins Mag 7 Earnings Reports Amid Withdrawn Company Guidance
US companies are being cautious during earnings season due to the ongoing global trade war. Key developments include:
- Delta Airlines withdrew its 2025 guidance, citing tariff policy uncertainty.
- CarMax also retracted its long-term growth timeline, emphasizing the speculative nature of future projections.
- United Airlines provided two profit forecasts: a high end of $13.50 EPS under stable conditions and a low end of $7 EPS in a recession.
- US retail sales increased by 1.4% in March, driven by consumers purchasing big-ticket items ahead of expected tariffs.
- The ISM manufacturing inventories index rose, indicating stockpiling of goods before price increases.
The earnings reports for the "Magnificent 7" (Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, Tesla) begin this week. Notable points include:
- Tesla's earnings report is anticipated due to potential tariff impacts on its business.
- Alphabet faces challenges as decreased business spending from tariffs may shrink the global ad market, with retail ads comprising about 25% of its revenue.
- Alphabet plans to invest $75 billion in capital expenditures by 2025 to enhance its AI and data center capabilities.
- Companies might increase reported expenses this earnings season to reserve earnings for later periods.
Upcoming earnings reports include Meta and Microsoft on April 30, with others scheduled for May.