Shares of Alphabet Inc. (GOOGL) and Advanced Micro Devices Inc. (AMD) fell sharply after their Q4 2024 earnings reports, despite strong financial results. Investors reacted negatively to weak performance in key business segments, sparking a sell-off in both stocks.
Key Financial Statistics (Q4 2024 Earnings Report)
| Company | Revenue (Reported) | Revenue (Expected) | EPS (Reported) | EPS (Expected) | Key Issue | Stock Drop % |
|---|---|---|---|---|---|---|
| Alphabet (GOOGL) | $96.47B | $96.68B | $1.64 | $1.61 | Google Cloud revenue miss | -7.1% |
| AMD | $7.7B | $7.5B | $1.09 | $1.08 | Data center revenue miss | -9.0% |
Alphabet (GOOGL) – Cloud Growth Disappoints
Alphabet reported $96.47 billion in Q4 revenue, slightly below Wall Street’s expectation of $96.68 billion. The main concern was Google Cloud, which posted $11.96 billion, missing forecasts of $12.19 billion. While Alphabet’s overall earnings per share (EPS) came in at $1.64, slightly above the expected $1.61, the stock still dropped 7.1% as investors feared slowing cloud momentum.
AMD – AI Boom Fails to Deliver Expected Gains
AMD’s earnings were mostly positive, with revenue of $7.7 billion surpassing the expected $7.5 billion. EPS of $1.09 slightly beat the forecast of $1.08. However, the company’s data center division—key to its AI growth ambitions—fell short, reporting $3.86 billion instead of the expected $4.14 billion. The stock plummeted 9.0% in after-hours trading as investors questioned AMD’s ability to compete with Nvidia’s AI chips.
Market Implications and Future Outlook
Both companies remain strong players in their respective fields, but the recent sell-off highlights investors’ high expectations, particularly in AI and cloud computing.
- Alphabet’s cloud business faces tough competition from Microsoft Azure and AWS, making future growth uncertain.
- AMD’s AI chip ambitions may need stronger execution to take on Nvidia, which dominates the sector.
Despite the pullback, long-term investors may view this as a buying opportunity if these companies can continue expanding their AI and cloud segments.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
Related:
