🍎 Apple Announces $110B Buyback

1) Apple Earnings 2) Google Hits $2T Market Cap, 3) Weight Loss Drugs Are Booming and more!

Author

Carbon Finance
May 03, 2024

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Happy Friday!

As a reminder, following today’s issue, the newsletter schedule will be changing!

I’ll be shifting back to a weekly release every Sunday, beginning May 12th.

I’ll also be experimenting with a fresh format over the next few weeks that I think you’ll really enjoy. Stay tuned!

Some key data bites from this week that you should know: 

In today’s newsletter:

  • 🍎 Apple Announces $110B Share Buyback

  • 📈 Google Hits $2T Market Cap

  • 🔎 Alphabet Announces A Dividend

Let’s dive right in!

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Apple is unloading its treasure chest.

The tech giant announced a colossal $110B share buyback, its largest ever, as part of its Q2 FY24 earnings release.

Additionally, Apple boosted its dividend by 4% to $0.25 per share.

Quarterly Highlights:

  • 🟢 Earnings: $1.53 vs. $1.50 Est.

  • 🟢 Revenue: $90.75B vs. $90.01B Est.

  • 🔴 iPhone Revenue: $45.96B vs. $46.00B Est.

  • 🟢 Services Revenue: $23.9B vs. $23.27B Est.

During the earnings call, CEO Tim Cook linked this quarter’s 4% sales dip to last year's circumstances when Apple replenished iPhone inventory and met pent-up demand following COVID-19 supply disruptions.

He noted that this added an estimated $5B in sales last year and suggested that excluding this figure, Apple would have seen revenue growth this year.

Importantly, Cook highlighted that iPhone sales in Mainland China are on the rise, with the iPhone 15 and iPhone 15 Pro Max being the two top-selling smartphones in urban China.

He reiterated his confidence about Apple's long-term prospects in that region.

While iPhone sales increased there, the overall revenue the company generated from China declined, though it was less severe than anticipated, dropping 8% to $16.37B.

Looking forward, CFO Luca Maestri projected modest optimism with expectations for low single-digit revenue growth next quarter.

He also anticipates steady double-digit growth in services, similar to the growth in the first half of the fiscal year, and a double-digit YoY increase in iPad sales.

Alphabet, the parent company of Google, is now a member of the elite $2T market cap club.

It joined forces with giants Microsoft, Apple, and Nvidia following the release of its Q1 FY24 earnings and announcement of its first dividend.

Overall, the advertising sector has been surging recently.

Meta's revenues rose by 27% YoY in Q1, though its stock declined due to an increased forecast in capital expenditures.

Snap, the parent company of Snapchat, also made headlines with its Q1 performance, posting revenues of $1.2B, up 21% YoY.

Surprisingly, it reported an adjusted EBITDA of $46M, far surpassing the $68M loss analysts anticipated.

The company also saw its daily active users grow by 10% YoY to 422M.

Pinterest is another social media company riding the wave of growth.

The company's stock soared nearly 20% this week following a 23% increase in revenue to $740M in Q1, doubling its growth rate from the previous quarter.

Similar to Snapchat, its user base also expanded, with global monthly users increasing 12% YoY to hit 518M.


The obesity drug market is booming, with giants like Novo Nordisk and Eli Lilly posting strong earnings this week.

Eli Lilly, known for Mounjaro, exceeded analyst expectations with earnings of $2.58 per share and revenue of $8.77B.

The company anticipates tight supply due to increasing demand, and thus expects continued strong sales from Mounjaro and their new weight loss drug, Zepbound.

Sales of Mounjaro tripled compared to the same quarter last year.

Novo Nordisk, maker of Wegovy, also beat estimates with a 28% YoY increase in net profit. Wegovy's sales doubled in Q1 to 9.8B Danish kroner.

Both companies raised their outlook for 2024, with Eli Lilly expecting sales growth of 24-28% and Novo Nordisk anticipating operating profit growth of 22-30%.

📣 A Message From Our Sponsor

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✈️ Death Mystery. A second Boeing $BA whistleblower was found dead following a sudden illness - USAT

📈 Capitol Gains. ETFs that are tracking lawmakers are outperforming the S&P 500 - FT

🌱 Weed Boom. The U.S. DOJ is moving to reclassify cannabis as less dangerous - R

📰 ChatGPT Lawsuit. Eight newspaper publishers are suing OpenAI over copyright infringement - CNBC

Notable Companies Reporting Earnings Next Week:

  • Monday (5/6):

    • Vertex $VRTX, Palantir $PLTR, Microchip Technology $MCHP, Realty Income $O, Simon Property Group $SPG, Lucid $LCID

  • Tuesday (5/7):

    • Walt Disney $DIS, BP $BP, UBS $UBS, Arista Networks $ANET, Ferrari $RACE, Occidental Petroleum $OXY, Datadog $DDOG, Coupang $CPNG, Electronic Arts $EA, Celsius Holdings $CELH, Twilio $TWLO, Rivian $RIVN, Match Group $MTCH, Reddit $RDDT, Lyft $LYFT

  • Wednesday (5/8):

    • Uber $UBER, Anheuser-Busch $BUD, Airbnb $ABNB, Arm Holdings $ARM, Shopify $SHOP, The Trade Desk $TTD, HubSpot $HUBS, Robinhood $HOOD, Affirm $AFRM, Duolingo $DUOL

  • Thursday (5/9):

    • Brookfield $BN, Roblox $RBLX, Warner Bros $WBD, Unity $U, Dropbox $DBX

  • Friday (5/10):

    • Enbridge $ENB

All of the companies that are reporting earnings next week can be viewed here.

Major Trades Published Since 4/29. Trades may be those of family members. [Source: 2iQ]

Buys

  • Marjorie Taylor Green (R)

    • Company: Vanguard S&P 500 ETF ($VOO)

      • Amount Purchased: $15K - $50K

Sells

  • Marjorie Taylor Greene (R)

    • Company: iShares Core S&P 500 ETF ($IVV)

      • Amount Sold: $15K - $50K

  • Tom Carper (D)

    • Company: JPMorgan Chase & Co ($JPM)

      • Amount Sold: $15K - $50K

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Disclosure: I own shares of $AAPL & $GOOG

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