Mgmt reported better-than-expected rev and EPS due to stronger services (subscriptions like Apple TV+ and Apple Music, warranties like Apple Care, cloud services like iCloud, licensing fees, and payment services like Apple Pay), which helped buffer soft hardware sales. Services are higher margin and more predictable, given the recurring nature of many services.
Overall, today’s report shows a slow cooling of the labor market, which is on the balance hawkish. This is not what the Fed wants to see. Dovish case: The US added only 187k jobs, versus an expected 200k, in July. Payrolls are lower than expected for a second straight month. Hawkish case: The jobless rate is down, though, at 3.5%, and hourly earnings are higher than expected.
BBG is out with an article about how the Swiss are set in their ways and won’t learn much from the CS debacle. The light regulation and oversight of the country are being blamed for the demise of CS.
Carl Icahn’s biz just cut its quarterly distribution by -50%. They are blaming a short-seller report for the firm’s 2Q23 net loss doubling from 1 yr ago. So, depositary unit holders will get $1 versus $2. The stock tanked.
Most of the S&P has reported earnings, and tech/internet companies have had some of the highest earnings beat rates. 89% of tech companies that reported have beat estimates. But their stocks have fallen on ave -0.8% the day after the report. Comm services have had it even harder. 16 of 17 co’s exceeded profit estimates, per BBG, but they fell -2.4%.
BBG has a fascinating story out today about SIM-swapping, which is causing incredible theft. Unlike other crimes, this one just requires someone to deceive customer service reps. The story walks through a Hollywood-type narrative of crypto-stealing, thieves turning on each other, untraceable tipsters—focused on a group of teens behind the scenes.
Airbnb is down after missing on # nights/experiences.