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Continue to check the earnings report ➡️ Next quarter guidance is strong, but the market still isn’t satisfied
Although this quarter’s performance was perfect, the guidance for next quarter (FY2027 Q1) has made the market slightly uneasy.
• Revenue guidance: It’s expected to be between $10.3B and $10.8B. While this figure continues to grow quarter over quarter, the midpoint of $10.55B is slightly below the market’s earlier ultra-high expectations of around $11B.
• Gross margin guidance: Expected to be 83% to 85%. This also suggests that profitability may be hovering near historical highs rather than accelerating upward.
Why were the earnings impressive, yet the stock price fell?
This phenomenon is often called “buy on rumor, sell on fact.” The market’s reaction to this earnings report is complex:
• Pullback after a big run: The stock had already surged significantly over the past year, and some investors may choose to take profits now. Even if results beat expectations, as long as it’s not “far beyond expectations,” it could still trigger selling pressure.
• Doubts about growth momentum: The market is concerned whether this explosive growth in data centers can truly sustain, and when the consumer side will recover. This is one of the key factors behind the stock decline.
#US ADP July private employment missed expectations
Continue to check the earnings report ➡️ Next quarter guidance is strong, but the market still isn’t satisfied
Although this quarter’s performance was perfect, the guidance for next quarter (FY2027 Q1) has made the market slightly uneasy.
• Revenue guidance: It’s expected to be between $10.3B and $10.8B. While this figure continues to grow quarter over quarter, the midpoint of $10.55B is slightly below the market’s earlier ultra-high expectations of around $11B.
• Gross margin guidance: Expected to be 83% to 85%. This also suggests that profitability may be hovering near historical highs rather than accelerating upward.
Why were the earnings impressive, yet the stock price fell?
This phenomenon is often called “buy on rumor, sell on fact.” The market’s reaction to this earnings report is complex:
• Pullback after a big run: The stock had already surged significantly over the past year, and some investors may choose to take profits now. Even if results beat expectations, as long as it’s not “far beyond expectations,” it could still trigger selling pressure.
• Doubts about growth momentum: The market is concerned whether this explosive growth in data centers can truly sustain, and when the consumer side will recover. This is one of the key factors behind the stock decline.
#US ADP July private employment missed expectations