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Apple, AMD earnings: What to know in markets Tuesday

Heidi Chung

Earnings season shifts into higher gear on Tuesday with a slew of quarterly reports, but investors will be paying especially close attention to tech giant Apple (AAPL) and chipmaker Advanced Micro Devices (AMD).

iPhone and wearable sales are likely to help Apple beat consensus expectations, according to RBC analyst Robert Muller. The firm used social media data to assess consumer interest in Apple’s products and the results were favorable to the company.

“Twitter volume for iPhones is higher and higher for longer, compared to previous years,” Muller said in a note Jan. 27. “Based on our analysis of social media sentiment in conjunction with RBC Elements, we found that the sentiment this year has been more positive than prior years. Positive sentiment increased 232% over 2018 (Sept.-Dec. period) and 139% over 2017. Not only do we expect this to drive this quarter’s results, we expect satisfied customers to return over the coming years when it is time to upgrade.”

A pair of 2019 Apple AirPod Pro noise-cancelling earphones and a wireless charging case, taken on November 5, 2019. (Photo by Phil Barker/Future Publishing via Getty Images)

iPhone shipments are expected to total 66.7 million for an average price of $781.35, according to Bloomberg compiled estimates. Furthermore, any updates and additional commentary from management on Apple TV+ will be closely monitored.

The iPhone maker is expected to report adjusted earnings of $4.56 per share on $88.38 billion in revenue during its fiscal first quarter. Shares have soared a whopping 98% over the past 12 months and are sitting just 4.6% from its all-time highs.

Meanwhile, chip giant AMD will also deliver quarterly results after the closing bell. AMD has started to cement its presence as a strong PC chipmaker, and analysts do not see share gains in that space declining in the near term. Wall Street is bullish headed into AMD’s earnings results Tuesday, and analysts expect that AMD’s data-center expansion will likely continued, while margins are also anticipated to have expanded about 200 basis points in 2020, according to Bloomberg data.

The chipmaker is estimated to report adjusted earnings of 30 cents per share on $2.11 billion in revenue during its fourth quarter. The options market is implying about a 8.7% one-day move in either direction following AMD’s earnings announcement, which is lower than the average 10.5% move over the past 8 quarters.

Shares of AMD have been on a tear, rising 124% over the past 12 months, outperforming its peers which jumped 48% in the same time period.

On the economic data side, investors can expect the following: Durable Goods Orders, December preliminary (0.9% expected, -2.1% prior); Durable Goods excluding Transportation, December preliminary (0.3% expected, -0.1% prior); Conference Board Consumer Confidence, January (128.0 expected, 126.5 in December); Richmond Fed Manufacturing Index, January (-3 expected, -5 in December).

Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.

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