Apple and Amazon Face Market Backlash Amid Disappointing Earnings Reports

Apple's Recent Financial Performance

Apple reported its fiscal 2024 fourth quarter results on October 31, 2024. The company posted a quarterly revenue of $85.8 billion, marking a 5% increase from the previous year. However, this growth was not enough to meet market expectations, leading to a decline in the stock price. The earnings per diluted share were reported at $1.53, which also contributed to the market's negative reaction.

Amazon's Recent Financial Performance

Amazon also released its third quarter results recently. The company reported net sales of $148.0 billion, representing a 10% increase from the same period last year. Despite this growth, the market reacted negatively to the earnings report, with Amazon's stock falling by 3.7%. The focus on AWS performance and the company's investments in AI were central to the market's scrutiny.

Market Reaction to Tech Results

The tech sector has been experiencing a downturn, with major companies like Apple and Amazon facing significant declines in their stock prices. This reaction is attributed to the overall tepid growth in earnings and revenue, which has not met the high expectations set by analysts and investors. Both companies' results were seen as underwhelming, leading to a broader sell-off in the tech sector.

Broader Market Context

The broader market context also plays a role in the reaction to these earnings reports. The S&P 500 Index saw technology as the worst-performing sector, with significant declines in other major tech stocks like Microsoft and Meta. This indicates a general lack of confidence in the tech sector's ability to sustain high growth rates.

Preview

In summary, the recent financial performances of Apple and Amazon have led to declines in their stock prices due to underwhelming growth and high market expectations. The broader market sentiment towards the tech sector has also contributed to the negative reaction.