A bevy of earnings hit the tape on Tuesday and Wednesday, and The Daily Breakdown is here to run through the results and big moves.
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Wednesday’s TLDR
- AMD, SMCI fall on earnings
- SHOP jumps on strong results
- Chipotle searches for support
What’s Happening?
Last week was a bombardment of events. This week really just boils down to earnings. Let’s look at a few main reports:
AMD (reported last night): Advanced Micro Devices delivered mixed Q2 results, slightly missing earnings estimates but topping revenue expectations. Investors were encouraged by solid Q3 guidance fueled by rising AI chip demand, while the company aims to offset losses tied to China chip restrictions. Shares are down about 5% this morning, but are up 24.6% over the last month.
SMCI (reported last night): Super Micro Computer came up short on both earnings and revenue, while also delivering disappointing guidance. Growth has cooled following last year’s AI-driven surge, and new tariffs under Trump are beginning to weigh on performance. Shares are down more than 15% this morning, but had climbed 87.9% on the year going into earnings.
DIS (reported this morning): Shares of Disney are slightly lower this morning despite beating on earnings estimates and giving a slight raise to its 2025 profit outlook. Revenue did slightly miss expectations ($23.65 billion vs. estimates of $23.68 billion), but the big focus is on Disney’s deal with the NFL to bring RedZone and other media assets into its universe.
UBER (reported this morning): Uber stock initially dipped 5% after reporting earnings this morning, but now shares are up slightly in pre-market trading. The company beat on earnings and revenue expectations, provided strong gross bookings and EBITDA outlooks for next quarter, and announced a $20 billion buyback plan.
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The Setup — Chipotle
On July 24th, Chipotle stock plunged more than 13% after reporting earnings. It continued to fall in the days after its report, eventually declining to a new 52-week low near $42. From here, bulls are hoping that the 200-week moving average can act as support, as shares are now down more than 25% from the July highs and almost 40% from the all-time highs.
Chipotle has struggled since its former CEO Brian Niccol left for Starbucks, although analysts still expect earnings to grow by about 9% this year and accelerate that growth to roughly 17% next year.
From here, bulls are hoping that the low-$40s can act as support and help give CMG shares a bounce back up toward $50. On the flip side, the bears are hoping this area fails as support, ushering in more potential downside momentum for this stock.
Options
Investors who believe shares will move higher over time may consider participating with calls or call spreads. If speculating on a long-term rise, investors might consider using adequate time until expiration.
For investors who would rather speculate on the stock decline or wish to hedge a long position, they could use puts or put spreads.
To learn more about options, consider visiting the eToro Academy.
What Wall Street’s Watching
Tesla’s July sales fell more than 55% in both the UK and Germany, underscoring growing challenges in Europe. At the same time, China’s BYD saw explosive growth — quadrupling sales in the UK and jumping nearly 390% in Germany. As Chinese rivals gain ground and tax incentives phase out, Tesla is facing mounting headwinds across critical international markets. Dig into the fundamentals for Tesla.
Shares of Shopify are ripping higher this morning, up more than 15% in pre-market trading after impressing Wall Street with its quarterly results. The company reported better-than-expected earnings and revenue results and provided a strong Q3 outlook, further emboldening investors amid the stock’s recent rally. Check out the chart for SHOP.
Disclaimer:
Please note that due to market volatility, some of the prices may have already been reached and scenarios played out.