The New York Stock Exchange in an archive photograph. Photo: Vlada Karpovich / Pexels, Pexels License. Cropped. Not Friday trading.
NEW YORK – Intel and Reddit shares plunged about 29% Friday afternoon after their quarterly reports, showing how sharply Wall Street can mark down a business even when its latest revenue numbers show substantial growth.
Nasdaq’s quote page (Intel) showed Intel at $65.145, down 29.24%, at 3:57 p.m. Eastern time. Reddit was at $91.975, down 29.03%, at 3:58 p.m. The figures are late-session snapshots, not closing prices.
The two selloffs came after results released Thursday. But describing them simply as earnings misses would obscure an important distinction: a company can deliver growth, or beat its own forecast, and still give investors a less reassuring picture of what comes next.
Intel warns the PC slowdown will last
Intel reported third-quarter revenue of $16.5 billion, up 21% from a year earlier. Earnings attributable to Intel were 60 cents a diluted share under generally accepted accounting principles and 52 cents on the company’s adjusted basis. GAAP net income attributable to Intel fell 18% to $3.3 billion.
Chief Financial Officer David Zinsner said revenue, gross margin and earnings per share exceeded Intel’s guidance. He also said the company expects the personal-computer slowdown to continue at least through the first half of next year.
For the fourth quarter, Intel forecast revenue of $15 billion to $16 billion, below its third-quarter total, and earnings of 10 cents a share, or 25 cents on an adjusted basis. That makes the outlook a different story from the improvement Intel reported for the quarter just ended.
Reddit’s growth does not prevent a steep decline
Reddit reported third-quarter revenue of $895 million, up 53% from a year earlier, and net income of $283 million. Diluted earnings per share rose 75% to $1.40.
The company’s daily active uniques, its measure of daily audience, increased 12% to 130.3 million. Advertising revenue rose 54% to $847 million. Those results nevertheless accompanied a sharp decline in the stock on Friday.
The comparison shows why operating growth alone does not describe an earnings-day market reaction. Share prices reflect expectations about future business performance, rather than simply whether the latest sales total is larger than last year’s. The company releases establish the reported results; they do not by themselves establish whether those results met Wall Street’s consensus forecasts.
For investors heading into the next round of reports, Friday’s contrast is clear: strong year-over-year numbers and an upbeat account of a completed quarter offer no automatic protection against a severe stock-price decline.
JBizNews Markets Desk | NEW YORK
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