US tech stocks surge as Apple, Amazon and Facebook update on progress

·3-min read

US tech stocks have enjoyed a strong rally on Wall Street in advance of earnings reports from some of the biggest names in the business.

Just a day after share values endured a global shock over tightening coronavirus restrictions, investors eagerly awaited updates on the progress made by the big earners of 2020 - Facebook, Amazon and Apple, to name a few.

They have enjoyed share surges of 36%, 74% and 58% respectively in the year to date, while many traditional stocks have struggled to even tread water given the COVID carnage. The FTSE 100 index in London, by reason of comparison, has lost a quarter of its value.

Facebook and Apple saw leaps of 5% in Thursday deals, with Amazon close behind, in anticipation of further news to celebrate as the digital economy dodges lockdown.

Below is a summary of what companies announced after the markets had closed:

Amazon

The online retailer-to-streaming operator was first out of the blocks - with third quarter revenues rising to $96.1bn from $70bn in the same period a year earlier.

It credited pandemic demand for household essentials and said it was already seeing evidence of early buying for Christmas gifts following its Prime Day sale earlier this month.

Shares rose more than 1% in after-hours dealing.

Facebook

Its shares extended their gains when it revealed that businesses using its digital advertising tools had accounted for a surge in sales during its own third quarter.

Revenue rose to $21.5bn from $17.7bn despite a limited ad boycott in July as part of a protest against hate speech on its platforms.

Facebook's monthly active user number of 2.74 billion also beat analysts' estimates.

Twitter

Twitter stock had advanced by 8% ahead of its own results.

However, the shares headed south, by up to 11%, when its user growth fell short of analysts' expectations - rising by just one million on the previous three months to 187 million so-called "monetizable daily active users".

It also warned that the outlook for advertising trends - up sharply in advance of the US election - was unclear.

Alphabet

Google's parent firm reported a return to advertising sales growth between July and September as the US economy got back into gear in the period.

Google, the biggest supplier of online ads partly thanks to its YouTube video service, accounted for 80% of its $46.2bn of revenue - up 6%.

That helped shares advance a further 7% in extended trading.

Apple

All was not quite so rosy at Apple.

Its shares fell 5% after it reported a slowdown in its key premium iPhone sales with revenue of $26.4bn recorded in the period, its first quarter, compared to $33.6bn in the same period last year.

That was partly explained by the new iPhone 12, which is 5G enabled, coming to market later than its new products normally would.

Apple said lockdown-popular Airpods and Macs helped total revenue climb to $64.7bn while services revenue, which includes Apple TV and App Store sales, was 16% up.