The Winners and Losers From This Week’s Earnings
This week's earnings saw Disney, Uber, and Central Garden & Pet beat expectations, while Alphabet, Harley-Davidson, and MicroStrategy missed the mark.
This week’s earnings reports painted a mixed picture across industries, with some companies outperforming expectations while others faltered amid shifting economic pressures. From tech giants to consumer-focused businesses, the latest quarterly results delivered key insights into market trends and investor sentiment.
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Winners: Disney, Uber, and Central Garden & Pet Lead the Pack
Disney Surpasses Expectations Despite Streaming Subscriber Declines
Entertainment powerhouse Disney (NYSE: DIS) reported its Q1 FY 2025 earnings, beating analyst expectations on earnings per share (EPS) and revenue. Disney reported adjusted EPS of $1.76 compared to the anticipated $1.45. Revenue climbed 4.8% year-over-year to $24.69 billion, surpassing estimates. Strong performances in Disney’s entertainment and sports divisions offset a slight decline in Disney+ streaming subscribers, which fell by 1% to 124.6 million.
Despite the slowdown in subscriber growth, CEO Bob Iger emphasized the continued profitability of the streaming segment. Additionally, Disney’s box office successes, including “Moana 2,” “Deadpool & Wolverine,” and “Inside Out 2,” contributed significantly to its strong quarter.
The company’s theme park segment also performed well, with revenue up 3% to $9.42 billion.
While domestic attendance softened slightly due to hurricane-related disruptions, CFO Hugh Johnston remained optimistic, stating:
“The consumer is a bit stronger than we would have expected. I think what we’re seeing is consumers are just very value focused, and you deliver value to them, they’re willing to pay the price for it.”
Uber Delivers Record Quarter but Faces Cautious Outlook
Uber (NYSE: UBER) reported its “strongest quarter ever,” according to CEO Dara Khosrowshahi. Revenue in Q4 2024 grew 20% year over year to $12 billion, beating estimates. Gross bookings reached $44.2 billion, an 81% increase, while earnings per share soared to $3.21 from $0.66 the previous year.
However, despite the stellar results, the stock dipped more than 8% after Uber issued cautious guidance for Q1 2025. The company projected gross bookings between $42 billion and $43.5 billion—slightly below analysts’ expectations—sparking concerns about slowing momentum. Still, Uber remains confident in its long-term growth, particularly in autonomous vehicle development.
Central Garden & Pet Exceeds Expectations With Strong Start to Fiscal Year
Pet and garden product supplier Central Garden & Pet (NASDAQ: CENT) posted a robust quarter, beating revenue estimates by 4.4%. The company reported Q1 FY 2025 sales of $656.4 million, a 3.5% year-over-year increase, and a surprise GAAP profit of $0.21 per share, far exceeding analyst expectations of a slight loss.
CEO Niko Lahanas credited increased shipments, operational efficiencies, and easing inflation as major growth drivers. With an 8.4% adjusted EBITDA margin and significant improvements in operating income, Central Garden & Pet is off to a strong start in 2025, positioning itself well in a stable yet competitive market.
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Losers: Alphabet, Harley-Davidson, and MicroStrategy Stumble
Alphabet Falls Short on Revenue, AI Spending Concerns Weigh on Stock
Alphabet (NASDAQ: GOOGL) shares tumbled 7.2% following a disappointing Q4 2024 earnings report. Revenue was $96.47 billion, narrowly missing the expected $96.56 billion. While the company beat earnings estimates by $0.02 per share, the market reacted negatively to Alphabet’s aggressive spending plans, including a massive $75 billion capital expenditure program to expand AI capabilities and infrastructure.
JPMorgan analysts cited high costs and weaker-than-expected cloud revenue as key factors in Alphabet’s post-earnings stock drop. With competition heating up in AI development, the company’s heavy spending may take time to yield tangible returns, leading to investor caution.
Harley-Davidson Struggles Amid Economic Headwinds, Reports Quarterly Loss
Harley-Davidson (NYSE: HOG) posted grim Q4 2024 results, with a net loss of $117 million, or $0.93 per share, far worse than the expected $0.66 per share loss. Revenue fell 35% year over year to $688 million, as motorcycle shipments plummeted 53%.
CEO Jochen Zeitz pointed to a “high-interest rate environment” dampening consumer confidence and impacting demand for discretionary products. While the company still generates substantial free cash flow, analysts at CFRA downgraded their rating, warning that weak sales trends could persist into 2025.
MicroStrategy Rebrands But Posts Major Loss
MicroStrategy (NASDAQ: MSTR), now rebranded as “Strategy,” reported a Q4 2024 loss of $3.03 per share, far below analysts’ expectations of a $0.09 per share loss. Revenue also declined by 3% to $120.7 million, missing estimates.
The company’s aggressive Bitcoin purchasing strategy, which saw it acquire $20.4 billion in Bitcoin over a 12-week period, has created volatility in its stock. Despite bullish long-term projections, including an expected 15% Bitcoin yield in 2025, MicroStrategy’s near-term financials remain under pressure. Shares fell 3.3% following the earnings release, continuing a downward trend.
Takeaway: A Mixed Bag as Market Volatility Continues
This earnings season highlighted the ongoing divergence between high-growth tech and consumer-driven sectors. While Disney, Uber, and Central Garden & Pet delivered robust performances, companies like Alphabet, Harley-Davidson, and MicroStrategy struggled with weaker-than-expected results and investor uncertainty.
Looking ahead, companies facing economic headwinds will need to navigate shifting consumer behavior, while market leaders must balance expansion efforts with profitability to maintain investor confidence.
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Disclaimer: Wealthy VC does not hold a position in any of the stocks, ETFs or cryptocurrencies mentioned in this article.
