Here is your Pro Recap of the biggest earnings reports you may have missed this week and how analysts responded: numbers out of retailers Victoria's Secret and Lululemon and tech names Salesforce, HP, Broadcom, and Dell.
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Thursday postclose roundup: Dell's huge results, disappointment at Broadcom, Lululemon beats
Dell Technologies (NYSE:DELL) soared 8.5% in recent premarket trading after the company said adjusted EPS totaled $1.74, smashing the $1.14 estimate, on revenue of $22.93 billion that topped the $20.86B target, as a jump in in service and software maintenance agreements boosted growth.
Recurring revenue rose 8% to $5.6B year-over-year in Q2, driven by "increases in service and software maintenance agreement," the company said.
Chipmaker Broadcom (NASDAQ:AVGO) reported earnings per share of $10.54 on revenue of $8.88B for its fiscal Q3, comfortably beating the analyst expectation for EPS of $10.43 on revenue of $8.85B, and said it expects AI-related spending on infrastructure software and semiconductors to boost demand.
The company expects to record Q4 revenue of $9.27B, up 4% from the prior year but slightly below the $9.28B consensus. Shares were losing 4.6% to $880 in early Friday trading.
Lululemon Athletica (NASDAQ:LULU) shares were up 1.5% to $387 in Friday's premarket after the company reported Q2 EPS of $2.68 that surpassed the $2.54 estimate, as well as better-than-expected sales of $2.2B.
The athleisure apparel retailer also said on Thursday that full-year profit should range from $12.10 to $12.17 a share, while revenue is expected at $9.51B to $9.57B.
Salesforce lifts its outlook
Earlier in the week, Salesforce (NYSE:CRM) shares climbed 3% Thursday after the software outfit lifted annual guidance and beat estimates for Q2, touting improved demand for the second half of the year.
Adjusted EPS totaled $2.21, easily surpassing the $1.90 average Street target, on revenue of $8.6B vs. the $8.53B consensus.
The company lifted its full-year guidance to earnings of $8.04 to $8.06 per share - far better than analyst estimates for $7.45 and up from the prior $7.41 to $7.43 range - given an anticipated firming of demand and improved margins through year-end. Revenue estimates were slightly lifted to $34.7B to $34.8B
Operating margin and operating cash flow growth was raised to 13.3% and a range of 22% to 23%, respectively. That compared with a prior estimate for margins of 11.4% and operating cash flow growth of 16% to 17%.
Third-quarter adjusted EPS was expected in a range of $2.05 to $2.06 on revenue of between $8.70B and $8.72B, topping Wall Street estimates of $1.82 and $8.67B, respectively.
Wolfe Research is staying with a Peer Perform rating "until we get conviction around double-digit top-line growth," but the firm is also raising its margin assumptions for the company "given the 'mission accomplished early' feel around margins, and the commentary around 30% being a floor not a ceiling."
Goldman Sachs (NYSE:GS) said these results will ease "some investor concern around Salesforce’s ability to balance top-line and OM expansion," noting that this "can lead the stock to re-rate higher," much as several other tech names have managed to do.
Shares closed Thursday at $221.46.
Victoria's Secret misses
Victoria's Secret (NYSE:VSCO) missed on Q2 estimates, triggering a Thursday premarket slide, but the stock ultimately pulled through in the regular session.
EPS of $0.24 came in worse than the consensus estimate of $0.27. Revenue was $1.43B, below the consensus estimate of $1.44B.
For Q3, the company expects a loss of between $0.70 and $1 far worse than the consensus estimate for a $0.14 shortfall. And for the full year, the company expects net sales to decrease in the low-single-digit range compared with last year, compared to the consensus estimate of approximately a 2% drop.
Wells Fargo (NYSE:WFC) slashed shares to Equal Weight from Overweight on these results, lowering its price target by $2 to $16 per share.
"Uncertainty on their ability to execute a turnaround is mounting and valuation should continue to erode," wrote the analysts.
BofA lowered the price target by $5 to $25, but remains Buy-rated, saying it is "encouraged by multiple opportunities to drive sales in 2H."
Still, shares strongly recovered after a low open, gaining 6.9% to $19.18.
HP loses ground on soft guidance
HP's (NYSE:HPQ) shares slid 6.6% after the company reported fiscal Q3 sales late Tuesday that fell short of Wall Street estimates, as well as weaker-than-expected annual earnings guidance, amid a slackening backdrop for PC demand.
Adjusted EPS of $0.86 was flush with Wall Street targets, but its top line of $13.2B missed the $13.38B consensus.
In its personal systems unit, which includes personal computers and accounts for the majority of growth, revenue fell 11% to $8.9B in Q3 year over year.
The company's Q4 guidance was $0.85 to $0.97, compared with Wall Street estimates for EPS of $0.95, and full-year EPS was estimated at $3.23 to $3.35, lower than the $3.37 average analyst target.
Several analysts lowered their price targets on the stock following the print. Bernstein said the report was disappointing, writing, "We worry about the structural health of the printing business and its ability to grow over time," even though PC revenues are "likely to improve going forward."
The firm added that the shares are "more expensive than HPE, which is less structurally challenged."
Yasin Ebrahim, Davit Kirakosyan, Liz Moyer, and Senad Karaahmetovic contributed to this report.
