The after-hours trading session saw dramatic swings, especially for stocks like Applied Materials, Take-Two Interactive Software and Cava Group. Investors quickly reacted to positive or negative quarterly earnings reports. The revised estimates were well below analyst expectations, prompting massive re-adjustments in share prices.
Applied Materials was down close to 5% on its own shares in after-hours trading. The semiconductor behemoth announced last quarter’s quarterly semiconductor revenue came in at $5.26 billion — missing estimates of $5.31 billion that analysts were looking for. It’s showing— the company beat earnings estimates in the first quarter, with revenue of $332 million compared to expected revenue of $327 million. Its fiscal second quarter revenue of $7.10 billion missed the expected $7.13 billion. Applied Materials gave full-year revenue guidance of $5.9 billion to $6 billion. That figure was well below analyst expectations, which had been $7.82 billion.
Unlike Applied Materials, Take-Two Interactive Software ran into its own roadblocks. Its stock fell 2% this morning after the firm provided disappointing earnings guidance that fell short of analysts’ expectations. The company forecasted bookings of $1.25 billion to $1.30 billion, below the Street’s expected $1.28 billion. This announcement sent alarm bells through investors as they worried for the company’s growth opportunities in a more competitive gaming landscape.
At the same time, Cava Group wasn’t immune to the broader market downturn, with its shares down 4%. The company increased its full-year adjusted EBITDA guidance to a range of $152 million to $159 million. That forecast could have potentially thrown investors into doubt regarding its future performance in the stock market.
These recent events are indicative of the current fragility of the stock market as corporations continue to try to follow the unpredictability of earnings seasons and investors’ expectations. Advocates should watch these companies closely moving forward, especially as they start to adjust to a recession and shifts in consumer behavior.