Next week’s big tech earnings will excite investors. Market participants wonder if Q3 numbers may trigger a year-end surge after three months of sluggish movement. Alphabet and Meta Platforms (META) are mega-caps. But how do company expectations compare? Let’s examine advertising revenue as well.
Despite the $3.57 Zacks Consensus EPS Estimate, up 6% since July, analysts are optimistic about the quarter. The predicted increase is 120% year-over-year.
Top line projections have also increased, with the $33.4 billion quarterly estimate up 2.5% and 20% from the year-ago period.
Advertising accounts for a large portion of sales for the company. The Zacks Consensus Estimate for Advertising Revenue for the forthcoming release is $32.9 billion, up 20% year-over-year.
Ad spending is one of the first things firms cut in a recession, so the predicted growth is remarkable. META has recently outperformed consensus ad revenue projections, most recently by 4.2%.
The company’s valuation is sound given its predicted growth of 36% earnings and 12% revenue growth in its current year. Like the 23.1X five-year median, shares trade at 23.4X forward earnings multiple (F1).
The $1.45 Zacks Consensus EPS Estimate for Alphabet’s release is 1.4% higher from July. This quarter’s predicted result is up 36% over last year.
The $63.1 billion quarterly revenue projection is up 0.5% from July and 10% higher than year-ago sales of $57.3 billion. Advertising accounts for much of Alphabet’s revenue. The quarterly Zacks Consensus Estimate for advertising revenue is $58.9 billion, up 8% year-over-year.
See below for the company’s recent good surprises on this statistic. These forecasts and current outcomes don’t indicate a significant ad expenditure decline.
Investors will be busy next week with huge tech results. Alphabet and Meta Platforms are expected to report strong quarterly earnings growth on higher revenues, so many will be watching. After a tough 2022, cost-cutting has boosted IT sector profitability. These trends are mirrored in both firms’ predicted earnings growth rates.