Tech companies may find it hard to beat earnings estimates this season due to tough year-over-year comparisons along with multiple macroeconomic challenges including supply-chain and logistics issues, rising oil prices and inflationary situations. Additionally, the ongoing Russia-Ukraine war has been severely disrupting the businesses of several tech companies.
Last week, Netflix NFLX reported mixed quarterly results for first-quarter 2022 wherein non-GAAP earnings surpassed the Zacks Consensus Estimate but revenues fell short of the same. The performance of the streaming giant with respect to its key metrics put a question mark over its business model.
The company lost 0.20 million paid subscribers globally against the addition of 3.98 million in the year-ago quarter, missing its guidance of 2.5 million paid-subscriber additions. Its Russia operation’s exit hurt Netflix as it lost 0.7 million subscribers in the reported quarter. At the end of the first quarter, Netflix had 221.64 million paid subscribers globally, up 5% year over year, missing management’s expectation of 224.34 million.
Upcoming Earnings Releases
Investors interested in the technology sector are eagerly awaiting the earnings releases of players like CACI International CACI, Check Point Software Technologies CHKP and Avnet AVT on Apr 27.
CACI International is scheduled to report third-quarter fiscal 2022 results. The company's to-be-reported quarter's performance is likely to have benefited from its large pipeline of government projects. Its total backlog, as of Dec 31, 2021, was $24.1 billion. Back-to-back contract wins at regular intervals might have favored the to-be-reported quarter's performance. Also, increasing inorganic revenue growth and continued margin expansion may get reflected in the fiscal third-quarter results. (Read more: Factors Likely to Influence CACI's Fate in Q3 Earnings)
CACI International has an Earnings ESP of 0.00% and a Zacks Rank #3 (Hold).
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The Zacks Consensus Estimate for CACI’s revenues is pegged at $1.65 billion, indicating a 6.6% increase from the year-ago quarter. The consensus estimate for the bottom line is pegged at $4.79, implying a year-over-year decline of 9.3%.
CACI International, Inc. Price and EPS Surprise
CACI International, Inc. price-eps-surprise | CACI International, Inc. Quote
Check Point Software is set to report first-quarter 2022 results. The company’s quarterly performance is likely to have benefited from increased security subscriptions due to the solid demand for its CloudGuard, Harmony, Sandblast Zero-day threat prevention and Infinity solutions. Moreover, the increased demand for network security gateways to support higher capacities amid the work-from-home wave is expected to have spurred demand for CHKP’s remote access VPN solutions.
However, continued industry-wide component supply constraints might have impacted the company’s top-line growth while elevated investments in sales and marketing efforts might have clipped margins during the quarter to be reported. (Read more: Check Point to Report Q1 Earnings: What's in Store?)
Also, the stock’s combination of a Zacks Rank #3 and an Earnings ESP of 0.00% makes surprise prediction difficult. The Zacks Consensus Estimate for Check Point Software’s revenues is pegged at $534.7 billion, suggesting a 5.3% increase from the year-ago quarter’s reported figure. The consensus mark for earnings stands at $1.54 per share, flat when compared with the year-ago quarter reported figure. You can see the complete list of today’s Zacks #1 Rank stocks here.
Check Point Software Technologies Ltd. Price and EPS Surprise
Check Point Software Technologies Ltd. price-eps-surprise | Check Point Software Technologies Ltd. Quote
Avnet is slated to report third-quarter fiscal 2022 results. The company's fiscal third-quarter performance is likely to have benefited from high demand for its electronic components. However, headwinds related to COVID-19 restrictions and persistent disruption from supply-chain constraints might have weighed on the company's top and bottom lines in the quarter to be reported. (Read more: Factors Likely to Decide Avnet's Fate in Q3 Earnings)
The company has an Earnings ESP of 0.00% and carries a Zacks Rank 4 (Sell). The Zacks Consensus Estimate for third-quarter revenues is pegged at $5.62 billion, suggesting an increase of 14.2% from the year-ago quarter's reported figure. The consensus mark for earnings stands at $1.51 per share, which indicates a year-over-year surge of 104.1%.
Avnet, Inc. Price and EPS Surprise
Avnet, Inc. price-eps-surprise | Avnet, Inc. Quote
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