Nasdaq Climbs as Alphabet, Snap, Reddit Post Strong Q3 Results

After-Hours Earnings Report: Google Surges, Mixed Results Across Other Sectors

A high-stakes earnings day saw Alphabet (Google’s parent company) exceed Wall Street expectations, led by strong growth in its cloud division. Meanwhile, several other major companies reported mixed results, reflecting varying levels of demand and performance across sectors.

Alphabet (NASDAQ: GOOGL)

Alphabet outperformed on top and bottom lines, showcasing strong growth in its cloud services segment. Third-quarter revenue totaled $88.27 billion, surpassing the expected $86.3 billion, while earnings per share (EPS) came in at $2.12, beating the forecasted $1.85.

Google Cloud delivered a standout performance with revenue of $11.35 billion, far exceeding the $10.88 billion analysts expected and marking a 35% increase over last year. Alphabet’s AI-driven products were key contributors, with CEO Sundar Pichai emphasizing how these technologies are helping enterprise clients scale, especially in the cloud sector.

Advertising revenue, the company’s primary income stream, continued its positive trend, reaching $65.85 billion, though its growth has slightly decelerated amid increased competition from platforms like TikTok and Netflix. Alphabet’s YouTube advertising also beat estimates at $8.92 billion, hinting at sustained demand for digital ads. Following these results, Alphabet’s stock rose 4% in extended trading.

Other Key Earnings Reports

• AMD (NASDAQ: AMD)
AMD’s earnings met expectations, reporting $0.92 per share with revenue slightly above estimates at $6.82 billion. While the data center segment showed robust growth, doubling year-over-year sales driven by high demand for AI chips, the overall revenue guidance for the fourth quarter remained flat. Investors responded cautiously, leading to a 5% decline in AMD shares in after-hours trading.

• Snap Inc. (NYSE: SNAP)
Snap beat both revenue and EPS estimates, with EPS at $0.08 versus $0.05 expected and revenue slightly exceeding forecasts at $1.37 billion. However, the company issued conservative fourth-quarter guidance, dampening some investor enthusiasm. The company also announced a $500 million stock buyback, boosting shares by over 10% post-report.

• Chipotle (NYSE: CMG)
Chipotle reported mixed results, posting EPS of $27, just above analyst expectations of $0.25, while revenue slightly missed at $2.79 billion against a projected $2.82 billion. Same-store sales rose 6%, but this was shy of the anticipated 6.3% growth. Higher food costs due to increased portion sizes affected profitability, leading to a 7% decline in Chipotle’s stock after hours.

• Reddit Inc.
Social media company Reddit reported better-than-expected results, with EPS of $0.16 versus an anticipated loss of $0.07, and revenue at $348.4 million, beating the forecasted $312.8 million. Reddit also raised its fourth-quarter outlook, predicting revenue between $385 million and $400 million, well above analysts’ estimates. Shares rose 22% in after-hours trading.

Conclusion

Today’s earnings offered an optimistic view for the tech sector, particularly Alphabet’s successful cloud expansion, despite some cautious forecasts elsewhere. With Alphabet’s results setting a positive tone, tech stocks may see short-term gains, while Snap and Reddit show resilience in social media. Conversely, AMD and Chipotle may face pressure until stronger economic conditions bolster consumer and enterprise spending.

Market Forecast: Bullish for technology and social media; Neutral for consumer discretionary sectors awaiting consistent demand growth.