Apple falls 8% and Amazon rises 12% on the same day after earnings
WHAT HAPPENED
Apple reported revenue of $109.417 billion, but its Services business fell short of expectations and the stock fell 8%. Amazon generated $200.6 billion; its cloud grew 37% and the stock rose 12%.
WHY IT MATTERS
The stock market does not compare a company only with last year: it compares it with what was expected. Apple raised concerns due to the slower growth of Services, its highest-margin business, and the chip shortage. Amazon excited due to the cloud, used by thousands of companies.
AND FOR YOUR PORTFOLIO
These movements show why a stock can fall even when the company makes more money. Apple and Amazon are in many funds that track the S&P 500, so their changes also indirectly influence diversified investments, even if you do not own their stocks directly.
💬 TELL IT LIKE THIS
“In the stock market, exceeding last year is not enough: you also have to exceed expectations and do so in the business that matters most.”