Here are some of the highlights from Q3 earnings reports made by Tesla, Microsoft, PayPal, eBay and Snap Inc.
With the third quarter of the year coming to a close for many organisations, some of the world’s biggest tech players have been reporting their most recent earnings updates. Tesla has surprised investors, Microsoft has seen Xbox sales drop and Snap Inc is inching closer to profitability.
We have rounded up some of the most interesting details from last quarter, as we still await Twitter’s update, which is due later today (24 October).
Tesla seems to be making the most headlines this morning, with shares soaring by 20pc after the company’s surprising earnings call, bringing the company to its highest share price since February.
While analysts expected a 42 cent loss per share, Tesla reported earnings of $1.86 per share excluding certain items. The company’s revenue for the last quarter was $6.3bn, which is just below the $6.33bn that was forecast.
The company also told shareholders that it is ahead of schedule with the output at its new factory in Shanghai and expects to have shipped 360,000 vehicles by the end of the year. The Model Y is expected to be produced by summer 2020.
In an outline of its earnings, Tesla said: “Operating expenses are at the lowest level since Model 3 production started. As a result, we returned to GAAP profitability in Q3 while generating positive free cash flow. This was possible by removing substantial cost from our business.”
In the latest quarter, Microsoft was carried by its cloud and Office products, while sales of the Xbox and Surface slowed down. Microsoft’s revenue between July and September came in at $33.1bn, which is just shy of the $33.7bn it achieved in the last quarter, but marks a 14pc increase year over year.
Microsoft’s chief executive, Satya Nadella, noted the success of the company’s continuing growth in cloud service, which generated $11.6bn in revenue for the quarter, up 36pc on last year.
While Office consumer products and cloud services revenue grew, revenue from the Xbox decreased 7pc, owing to fewer hardware sales of the main console. There was also a 4pc drop in Surface device revenue, which Microsoft attributed to “the timing of product lifecycle transitions”.
In the latest quarter, PayPal reported net income of $462m, or 39 cents a share, up from $436m in the same quarter last year. The company’s revenue for Q3 was $4.38bn, up from $3.68bn a year ago. This exceeded analyst expectations of $4.35bn.
In Q3, PayPal’s total payment volume (TPV) was a massive $179bn. PayPal’s mobile payment service Venmo reported a TPV of $27bn in the same quarter. The company reported 9.8m new active accounts in the third quarter, and announced that it processed more than 1bn transactions per month for the first time.
E-commerce giant eBay reported revenue of $2.65bn in Q3, which is slightly above the $2.64bn that was expected from the company. It reported earnings of 67 cents per share, also exceeding analysts’ expectations of 64 cents per share.
However, the company lowered its fourth-quarter guidance, expecting earnings of between 73 cents to 76 cents per share, with revenue between $2.77bn and $2.82bn.
As we reported yesterday, things are looking positive for Snap Inc. Snapchat said it has attracted 210m daily active users in its latest quarter, up 13pc year on year. The parent company’s revenue was $446.2m in the three months to the end of September, an increase on the $288m from the previous quarter.
According to the company, users are opening the app 30 times per day, compared to 25 times per day in July 2018. The company continues to operate at a net loss but edged a step closer to profitability, with losses shrinking to $226.3m in this period, compared to the $255.2m the three months before.