Monday November 23, 2020
Alphabet Posts Earnings
Revenue for the quarter came in at $46.2 billion during the quarter. This was up from $40.5 billion last year at this time.
"We had a strong quarter, consistent with the broader online environment," said Alphabet CEO Sundar Pichai. "It's also a testament to the deep investments we've made in AI and other technologies, to deliver services that people turn to for help, in moments big and small."
The company reported quarterly net income of $11.2 billion. This was up from $7.1 billion in the prior year's quarter.
Despite the economic impacts of COVID-19, the parent company of Google grew its advertising revenue during the quarter. The company raked in $26.3 billion of revenue through its Google Search & Other category. YouTube ads brought in an additional $5.0 billion in revenue. Google Cloud and Other Bets brought in $3.4 billion and $178 million respectively.
Alphabet Inc. (GOOG) shares ended the week at $1,621.01, relatively unchanged for the week.
Amazon Delivers Earnings Report
Amazon.com, Inc. (AMZN) released its latest quarterly earnings on Thursday, October 29. The company's earnings continued to grow during the quarter.
Net sales came in at $96.1 billion for the quarter. Last year at this time, the company reported net sales of $70.0 billion.
"Two years ago, we increased Amazon's minimum wage to $15 for all full-time, part-time, temporary, and seasonal employees across the U.S. and challenged other large employers to do the same. Best Buy and Target have stepped up, and we hope other large employers will also make the jump to $15. Now would be a great time," said Jeff Bezos, founder and CEO of Amazon. "Offering jobs with industry-leading pay and great healthcare, including to entry-level and front-line employees, is even more meaningful in a time like this, and we're proud to have created over 400,000 jobs this year alone."
The company reported net income of $6.3 billion during the quarter, or $12.37 per share. This was up from $2.1 billion, or $4.23 per share during the same quarter last year.
Over the years, Amazon has successfully expanded its footprint from an online bookstore to a multifaceted digital company offering Prime Video, Alexa-enabled smart devices and Amazon Web Services. Amazon's flagship commercial website has allowed the company to thrive during the global pandemic, as consumers around the world have shifted more heavily to online shopping.
Amazon.com, Inc. (AMZN) shares ended the week at $3,036.15, down 5.1% for the week.
Hasbro Reports Earnings
Hasbro, Inc. (HAS) released its latest quarterly earnings on Monday, October 26. The company's revenue and profits rose year-over-year.
The toy company reported revenue of $1.78 billion for the quarter. This was up from $1.58 billion during the same quarter last year.
"Hasbro's third quarter performance was the result of great work from our global team and continued growing consumer demand for Hasbro brands in most markets," said Hasbro's CEO, Brian Goldner. "Our broad, innovative product line, including leadership in gaming, excellence in global [ecommerce] and compelling marketing campaigns drove meaningfully better performance in the third quarter."
Net earnings reached $220.0 million during the quarter. This was up 12.4% from $212.9 million at this time last year.
The popular toy maker has experienced increased demand in its gaming category during the quarter. This was due, in large part, to families' increased time at home during the global pandemic. Gaming revenue reached $543.1 million during the quarter. This was a 21% increase from $449.4 million in 2019.
Hasbro, Inc. (HAS) shares ended the week at $82.72, down 4.9% for the week.
The Dow started the week at 28,186 and closed at 26,502 on 10/30. The S&P started the week at 3,441 and closed at 3,270. The NASDAQ started the week at 11,441 and closed at 10,912.
Treasury Yields Rise
On Thursday, the U.S. Department of Labor announced 751,000 new jobless claims for last week. This was down 40,000 from the prior week and lower than the 778,000 new claims projected by experts.
"We had expected that the steep decline we saw in claims last week would be too big to repeat, but downside momentum in claims remains intact," said Thomas Simons, an economist with Jeffries & Company. "The question going forward is going to be whether a surge in COVID cases and renewed measures aimed at containing the virus will lead to another spike in claims in the coming weeks."
The benchmark 10-year Treasury note was at 0.865% during trading on Friday, up from 0.842% on Monday. The 30-year Treasury bond reached 1.743% on Friday, up from Monday's opening yield of 1.643%.
On Friday, the Commerce Department released the latest personal consumption expenditures (PCE) numbers. PCE rose 1.4% in September to $201.4 billion. This outpaced analysts' expected increase of 1%.
"We see that consumers are still spending," said Stifel Nicolaus & Co. Chief Economist Lindsey Piegza. "In many cases, they are spending differently, meaning the composition of goods and services in their basket are different now."
The 10-year Treasury note yield closed at 0.88% on 10/30, while the 30-year Treasury bond yield was 1.66%.
Mortgage Rates Hold Steady
The 30-year fixed rate mortgage averaged 2.81% this week, up from 2.80% last week. Last year at this time, the 30-year fixed rate mortgage averaged 3.78%.
This week, the 15-year fixed rate mortgage averaged 2.32%, down from last week's average of 2.33%. During the same week last year, the 15-year fixed rate mortgage averaged 3.19%.
"The record low mortgage rate environment is providing tangible support to the economy at a critical time, as housing continues to propel growth," said Sam Khater, Chief Economist at Freddie Mac. "Strong purchase demand is helping to lift the construction, manufacturing and transportation industries that build new homes and it is also leading to more consumer spending for owners, who are selling or improving their homes."
Based on published national averages, the national savings rate was 0.05% for the week of 10/26. The one-year CD finished at 0.17%.