Earnings playbook: Apple and Google-parent Alphabet lead the busiest week of reports

The busiest week of earnings is upon us, with roughly 20% of the S & P 500 slated to report — including some of the biggest companies in the world. Apple, Google-parent Alphabet and Meta Platforms are all scheduled to post their latest quarterly results this week. Pharma giant Pfizer and automakers General Motors and Ford Motor are also among the roughly 100 S & P 500 names on deck. The earnings season thus far has been lackluster. Approximately 140 S & P 500 components have posted their latest quarterly results. Of those companies, just 70% have beaten expectations. That’s below the historical trend of 79%, according to The Earnings Scout CEO Nick Raich. Check out some of the key companies slated to post results this week, and what investors can expect out of each report. Tuesday General Motors is set to report earnings before the bell, followed by a conference call at 8:30 a.m. ET. Last quarter: GM posted a big earnings beat, but maintained its full-year guidance, citing “headwinds.” This quarter: Analysts polled by Refinitiv expect earnings and revenue to grow by more than 20% each from the year-earlier period. What CNBC autos reporter Michael Wayland is watching: “GM was able to outpace the industry in fourth-quarter U.S. sales, but it was likely at the expense of what have been record or near-record profits on vehicles in North America. The U.S. auto market appears to be slowly normalizing, or at least stabilizing, from a vehicle supply standpoint that started in 2020. The major question is how much pent-up consumer demand is left due to rising interest rates and recessionary fears. Wall Street analysts have been watching for signs of a ‘demand destruction’ scenario for several quarters, and all eyes will be on GM’s outlook for 2023.” What history shows: Data from Bespoke Investment Group shows GM beats earnings expectations 85% of the time. The stock averages a meager 0.08% on earnings day, but jumped 3.6% after the company posted third-quarter results. Pfizer is set to report earnings in the premarket. Management is slated to hold a call at 6:45 a.m. ET. Last quarter: PFE raised its 2022 earnings guidance and posted a stronger-than-forecast profit . This quarter: Analysts see a small decline for the pharmaceutical giant, as well as slight year-over-year revenue growth, according to Refinitiv. What CNBC is watching: Investors will be watching for clues on how much a reduction in Covid-related revenue hurt the company in the previous quarter. Last week, UBS downgraded Pfizer to neutral from buy, citing pressure to the company’s Covid revenue . What history shows: Pfizer has a strong history of topping analysts’ expectations, with its beat rate coming in at 87%, per Bespoke. FactSet data also shows Pfizer’s earnings have exceeded estimates in the last seven quarters. McDonald’s is set to report earnings before the bell, with company leadership set to hold a call 8:30 a.m. ET. Last quarter: MCD ‘s earnings topped expectations as customers returned despite higher prices . This quarter: The fast-food chain’s earnings are expected to grow by high single-digits, but revenue is forecast to decline, Refinitiv data shows. What CNBC restaurant reporter Amelia Lucas is watching: “The fast-food giant is considered a bellwether for the broader restaurant industry and general consumer spending trends. McDonald’s is expected to report another strong quarter, fueled by enduring demand in the U.S. for its Big Macs and McNuggets and more resilience in Europe than previously predicted. Investors will also be watching for more details on the company’s updated strategy, which includes reorganizing its corporate structure and accelerating development plans for new locations.” What history shows: McDonald’s earnings have beaten expectations in six of the last seven quarters, per FactSet. Wednesday Meta Platforms is set to report earnings after the close. A conference call is also scheduled for 5 p.m. ET. Last quarter: META shares plummeted on the back of a disappointing fourth-quarter forecast and an earnings miss . This quarter: Refinitiv data shows analysts expect a big year-over-year earnings drop for the social media giant. What CNBC social media reporter Jonathan Vanian is watching: “Investors are hoping that the Facebook parent reveals any positive signs that its online advertising is picking up after a tough 2022 that was rocked by a weak economy. The social-networking giant recently reported two straight quarters of sales declines and is expected to post another quarterly revenue drop this week, underscoring how it has been shaken by businesses pausing their digital advertising campaigns due to recession fears. Further, investors want to see whether Meta is showing any indication that its Reels short-video service is attracting more eyeballs as it fends off competition from rival TikTok. Additionally, investors will be interested to hear from Meta executives on whether its recent cost-cutting initiatives, which include laying off over 11,000 employees , will improve margins.” What history shows: Facebook’s parent company has beaten earnings expectations 86% of the time, and the stock averages a 1.17% gain on earnings day, according to Bespoke. However, the social media giant has missed analysts’ estimates for two straight quarters, per FactSet. The stock also fell 0.9% in the last earnings day. Thursday Qualcomm is set to report earnings after the bell, with a conference call slated for 4:45 p.m. ET. Last quarter: QCOM shares dropped on the back of the company’s fiscal first-quarter guidance . The company also announced a hiring freeze. This quarter: The chipmaker’s earnings and revenue are expected to have fallen by double digits, according to Refinitiv. What CNBC tech reporter Jordan Novet is watching: “During the pandemic, it was hard for consumers and businesses to get a hold of PCs because of chip supply shortages. Then the problem flipped: Suddenly, organizations had much more inventory than they needed, and demand was not high enough to match supply. That caused trouble for Intel in the fourth quarter . Now, Qualcomm, a major provider of chips for smartphones, faces a demand issue of its own. In November, it said channel inventory across the industry was high, and it called for the first revenue decline since 2020 in the fiscal first quarter. Commentary about the speed of the pace of the inventory drawdown, or expectations of purchasing activity in China as Covid lockdowns ease, could help Qualcomm’s stock counteract downward pressure from a potentially downbeat quarterly report.” What history shows: Qualcomm has either beaten or matched analysts’ earnings expectations in the last 32 quarters, according to FactSet. Alphabet is set to report earnings after the close, followed by a conference call at 4:30 p.m. ET. Last quarter: GOOGL posted weaker-than-expected earnings and revenue as YouTube revenue declined . This quarter: Alphabet’s revenue is expected to come in roughly flat from the year-earlier period, per Refinitiv. However, analysts see earnings per share dropping by more than 20%. What CNBC tech reporter Jennifer Elias is watching: “While analysts expect Google to not be immune to conditions of cloud and advertising spend softening, they do expect the company to show better results than other big-cap tech names. Google is among the best positioned to weather a recession, analysts said. They also expect to see YouTube revenue growth to continue decelerating as ad spend softens and competing video sites like TikTok eat up more market share. Investors expect better-looking pockets like Search revenue to continue growing during the year, but they also await details from leadership on their outlook for the rest of 2023 .” What history shows: FactSet data shows Alphabet’s earnings have missed expectations for three straight quarters. Amazon is set to report earnings after the bell. Management is slated to hold a call at 5:30 p.m. ET. Last quarter: AMZN shares dropped on weak fourth-quarter guidance . This quarter: Analysts polled by Refinitiv expect a massive earnings per share drop from the e-commerce giant. What CNBC tech reporter Annie Palmer is watching: ” Amazon warned investors to prepare for a rough fourth quarter in its most recent earnings report. It guided for single-digit revenue growth between 2% and 8%. The company has been grappling with slowing sales in its core retail business amid high inflation and a shaky economic outlook. Even Amazon’s cloud-computing business, usually a growth engine, isn’t expanding as quickly as inflation-hit businesses soften their spend in an effort to cut costs. A key topic on the earnings call will be CEO Andy Jassy’s efforts to bring expenses under control, including whether the recent job cuts and corporate hiring freeze were enough to accomplish that goal.” What history shows: Amazon’s earnings have beaten expectations 62% of the time, according to Bespoke. The stock also averages a 0.86% gain on earnings day, but it fell 6.8% after the company’s third-quarter report. Ford Motor is set to report earnings after the closing bell, followed by a call at 5 p.m. ET. Last quarter: F revealed a net loss driven by supply chain issues and an AI investment. This quarter: The automaker’s top line is expected to have grown by more than 10%, and its earnings per share are forecast to have more than doubled year over year, per Refinitiv. What CNBC autos reporter Michael Wayland is watching: “Much like General Motors, Ford’s operations appear to slowly be normalizing, which is a double-edged sword for investors. More steady production means better sales, but also a normalization of per-vehicle profits that have been inflated due to tight inventories. Aside from Ford’s 2023 outlook, it will be interesting to see if the automaker announces any additional cost-cutting actions, specifically in Europe, and if it plans to change its electric vehicle pricing in response to Tesla’s massive price cuts earlier this month. Ford was the second best-selling automaker of EVs in the U.S. last year, albeit trailing Tesla by a wide margin.” What history shows: Ford has beaten earnings expectations nearly 70% of the time, according to Bespoke. However, the stock averages a drop of 0.29% on earnings day. To be sure, Ford shares rose 1.4% after the company’s third-quarter figures were released. Starbucks is set to report earnings following the close, with a conference call expected for 5 p.m. ET. Last quarter: SBUX posted a U.S. sales increase as customers spend more on pricey drinks . This quarter: Analysts see slight year-over-year earnings and revenue growth for the coffee giant, according to Refinitiv. What CNBC restaurant reporter Amelia Lucas is watching: “Last quarter, Starbucks said that U.S. store traffic was nearly back to pre-pandemic levels, but did consumers pull back on their coffee spending during the all-important holiday season? The company also announced changes to its loyalty program that will improve margins and encourage members to order drinks that are faster to make. Another key area of interest is how China, Starbucks’ second-largest market, is bouncing back after the Chinese government relaxed its Covid rules.” What history shows: Starbucks beats expectations just 54% of the time, but the stock averages a gain of 0.7% on earnings days, per Bespoke. Apple is set to report earnings after the close. Management is slated to hold a call at 5 p.m. ET. Last quarter: AAPL results topped expectations, iPhone sales and services revenue came in below estimates . This quarter: Apple’s earnings and revenue are expected to have fallen slightly year over year, per Refinitiv. What CNBC tech reporter Kif Leswing is watching: “There are a lot of factors pointing to the company’s first year-over-year revenue decline since 2019’s March quarter. Apple couldn’t make enough iPhones because its primary assembly facility in China was mostly shut down for weeks due to Covid infections, and both the smartphone and PC markets plunged toward the end of the year. But the biggest factor for Apple will be if management tells investors not to worry about holiday sales with a strong March quarter guide, suggesting that people who couldn’t pick up a new phone at Christmas are willing to wait for Apple’s production to come back. A weak March guide would suggest that Apple is seeing a slowdown in consumer confidence that could hurt its sales.” What history shows: Apple has a strong track record of topping analysts’ expectations, with the tech giant’s beat rate coming in at 89%, according to Bespoke. The stock also averages a 1.3% gain on earnings day. — CNBC’s Michael Bloom contributed reporting.

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