Thursday, April 19, 2012

Earnings From the Tech Sector

Earnings season is off to a sluggish start, with some prominent tech companies coming out of the gate in somewhat disappointing fashion. First off, IBM fell short of the consensus of its revenue expectations. Even though it did beat expectations on its earnings, the market was no impressed, and drove Big Blue's stock down by 2.4 percent.

Intel was a similar story. It beat its earnings estimates, and just barely beat its revenue estimates, but that wasn't enough for investors. Its profit margins were down from the previous quarter, and Intel's share price dropped 1.7 percent on the day. As usually happens, the expected earnings had already been factored into the share price, which means barely beating expectations was not enough to bolster a share price.

These tech companies have become a bit of a sideshow this earnings season - the bigger news comes next Tuesday. That's when Apple, which is just the largest tech company but by far the largest company in the U.S., releases its first quarter earnings report.

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