A Big Earnings Week Ahead

This week, many Wall Street darlings are set to report their latest quarterly results. Given the trend of stronger-than-expected results that have been posted by now, this week's set of reports have a heightened bar to clear. Fortunately, it's something that Big Tech companies, including Facebook FB, Apple AAPL, Amazon AMZN, Microsoft MSFT, and Alphabet GOOG, showed they are well capable of. 2021 isn't as bright as 2020 which was shaped by a global pandemic that held the world's population at home, fueling unprecedented demand for their software, and growth seems to be slowing down. Snap Inc's SNAP recent revenue miss and weaker-than-expected fourth-quarter guidance was a reminder of how earnings season can bring some major surprises, in both directions.

Facebook

After Snap's miss due to global supply and labor shortages, as well as recent changes to advertising tracking and measurement on iOS, investors will be looking to see if Facebook was caught up in the same headwinds on Monday after market close. But it's always possible that the social network comes out unharmed from the challenges Snap struggled with.

There are certainly some reasons to think Facebook could at least avoid some of the iOS headwinds as, unlike the teen mobile platform, the social network pioneer has a meaningful presence on desktop as well.

Microsoft

Wall Street expects Microsoft to report earnings per share of $2.07 along with revenue of $43.97 billion as demand is fueled by sustained work and learn from home trends. Although robust quarter results are likely, Microsoft is also expected to provide better-than-expected guidance to show it can maintain its impressive growth momentum.

Amazon

E-commerce and cloud giants could be similarly impacted by global supply and labor shortages but the question is how accurately did management account for these setbacks back when it provided guidance in its previously reported quarter. After all, it was already clear these issues will persevere until the end of the year.

On Thursday after the close, investors will be equally interested in Amazon's third-quarter results as well as its Q4guidance as the holiday quarter typically represents a large portion of the company's revenue and an even bigger share of its profits.

Alphabet

Although Google's earnings aren't as exposed to Apple's privacy changes that knocked down Snap, Alphabet has its own set of worries. Antitrust issues could start to cost Google.

Google has invested heavily in developing aggregated measurement approaches to prepare for Apple's privacy changes, but its primary headache continues to be antitrust scrutiny both in the U.S. and abroad. As a result, the company has announced last Thursday it will halve its app fees to 15% to ease the mounting pressure from developers, regulators, and lawmakers who criticized its digital store for not being accessible enough.

Apple

On Thursday, Apple is about to answer some burning questions for investors. The tech giant will reveal how well its new products, like the iPhone 13, are selling, although actual sales figures won't matter that much to overall quarter revenue as they were only present during the final days of the quarter. We'll get big updates on Apple's growing services segment along with an official sales projection for the critical holiday quarter ahead where investors will be looking at how is Apple managing supply chain challenges.

Apple is also facing its own set of regulatory pressures. Back in September said it would allow app developers like Netflix Inc NFLX and Spotify Technology S.A. SPOT to provide customers a link to create a paid account and avoid Apple's in-app-purchase commissions that go up to 30%.

As of last Friday, about 23% of S&P 500 companies had reported their third-quarter results, with FactSet reporting that 84% topped Wall Street's expectations for earnings per share.

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