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Boeing, Facebook, Tesla earnings — What to know in markets Wednesday

Heidi Chung
Reporter

Embattled industrial giant Boeing (BA) takes center stage Wednesday morning, while social media company Facebook (FB) and electric automaker Tesla (TSLA) grab investors’ attention after the closing bell.

Boeing (BA) kicks things off, as it faces its moment of truth ahead of the market open, and all of the attention will be on the troubled 737 MAX jets and Boeing’s full-year outlook. Analysts polled by Bloomberg expect Boeing to report adjusted earnings of $1.96 per share on $20.45 billion in revenue for the second quarter.

Last week, Boeing announced that it will be taking a $5.6 billion pre-tax, $4.9 post-tax, hit from the 737 MAX jet woes. The charge includes what Boeing estimates it would have to pay airline customers for groundings and delivery delays. Additionally, Boeing also said that the cost to produce the 737 MAX jets will increase by $1.7 billion in the second quarter. “The increased 737 program costs will reduce the margin of the 737 program in the second quarter and in future quarters,” Boeing said in a statement.

Though the company now anticipates that the 737 MAX jets will be back in service by early fourth quarter, there are no guarantees. If the jets are not back in the air by then, there could be additional costs for Boeing. The company also announced that it aims to produce 57 737 MAX planes per month in 2020.

Boeing will be releasing updated full-year guidance, as well as more updates on the impact of the 737 MAX groundings, on the earnings conference call, which kicks off at 10:30 a.m. ET.

[Read more: Here's what to expect when Boeing reports earnings Wednesday]

After the bell, investors will shift their focus to Facebook and Tesla.

Facebook’s second-quarter results will be pivotal for the company. After being forced to take a defensive stance, 2019 is the start of Facebook’s shift back to offense, according to Credit Suisse.

“One point of evidence to that change in stance is Instagram Checkout in our view – as this will help to eliminate the transactional friction on mobile of leaving one app and opening another – Instagram will be able to deliver more highly-qualified traffic to merchants and advertisers, which in turn should lead to higher ad pricing and greater sustained long-term revenue growth,” the firm wrote in a note Monday.

Daily and monthly active user figures will be closely watched. In the first quarter, Facebook reported 1.56 billion daily active users (DAU), and 2.38 billion monthly active users (MAU). Both DAUs and MAUs increased 8% year-over-year. Advertising revenue grew 26% in the first quarter to $14 billion. For the second quarter, analysts expect 1.59 billion DAUs and 2.41 billion MAUs for Facebook.

Updates on Facebook’s cryptocurrency project Calibra are also expected on the company’s earnings conference call.

Facebook is expected to report adjusted earnings of $2.24 per share on $16.5 billion of revenue, according to data compiled by Bloomberg.

[Read more: All eyes on Facebook's user growth ahead of Q2 2019 earnings]

Finally, Tesla takes the hot seat.

With profitability and deliveries very closely scrutinized, analysts and investors will be paying attention to are the average selling price (ASP), gross margins, and full-year delivery target guidance when Tesla reports.

“Tesla’s 2019 delivery target of 360-400k will be closely watched, as well as any indications around the Q3/Q4 cadence. We think there’s still a fair amount of skepticism around Tesla achieving anything above the low-end of its delivery range,” Citi said in a note Monday. “So a confident reiteration perhaps with supportive commentary on the pace of July deliveries would probably be received well.”

Earlier this month, Tesla reported better-than-expected second-quarter vehicle deliveries. The company delivered a record 95,200 vehicles in the three months ended June 30. The previous record was in the first quarter of 2018, when Tesla delivered 90,700 cars.

Analysts surveyed by Bloomberg expect Tesla to report an adjusted earnings loss of 31 cents per share on $6.44 billion in revenue.

Other notable earnings reports scheduled for Wednesday include Anthem (ANTM), AT&T (T), Caterpillar (CAT), Freeport-McMoran (FCX), Norfolk Southern (NSC), Northrop Grumman (NOC), UPS (UPS), V.F. Corp (VFC) before market open. Deutsche Bank (DB), Ford (F), GlaxoSmithKline (GSK), Las Vegas Sands (LVS), O’Reilly (OLRY), PayPal (PYPL), Spirit Airlines (SAVE), Xilinx (XLNX) will report after the market close.

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

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