Weekly StockWatch: AMD’s Light Guidance, BP’s Profit Surge, Chinese EV Deliveries Update & More

  • AMD.us
    (${instrument.percentChange}%)
  • BP.uk
    (${instrument.percentChange}%)
  • TKWY.nl
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  • NIO.us
    (${instrument.percentChange}%)
  • UBER.us
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  • XPEV.us
    (${instrument.percentChange}%)

BP Profit Surge

The British multinational energy behemoth saw another surge in its bottom line in the second quarter, as Underlying RC Profit blew past $8 billion, driven mostly by "continuing exceptional oil trading performance". [1]

The firm also increased its dividend by 10%, to $6.006 per ordinary share and announced that it executed share buybacks during the reported quarter, to the tune of $2.3 billion, expecting to buy another $3.5 billion.

CEO Bernard Looney noted that BP "continues to perform while transforming" and that it invests to "accelerate the energy transition". However, he also talked of a "$9-$10 billion of investment in the hydrocarbons business" in this decade in order to help with energy security. [2]

British Petroleum is just the latest energy behemoth to report blowout result, as these firms reap the benefits of surging oil and gas prices, with rival Shell's (SHEL.uk) Adjusted Earnings having jumped to $11.472 last week. [3]

French-based Total Energies saw its Net Income more than doubling from a year ago to $5.7 billion [4], while Earnings of US oil giant Exxon Mobil surged to $17.85 billion. [5]

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BP.uk jumped on Tuesday after the results and tries to post its third straight profitable week, despite the decline during the last two days.

AMD Record Revenues, Soft Guidance

The semiconductor company reported a blockbuster top-line on Tuesday after the US markets closed, since its Revenue surged 70% in Q2 year-over-year, to record highs of $6.55 billion. [6]

AMD changed its reporting segment, starting with these Q2 results, with the Client business being that largest Revenue generator, but also the one that saw the smallest yearly increase (25%), based on the conformed comparisons.

The Data Center sector surged 83% from a year ago, led by strong sales of server processor, while the Gaming segment generated $1.7 billion, driven by semi-custom chips for consoles such as Sony's (SONY.us) PlayStation 5 and Microsoft's Xbox.

Looking at AMD's bottom line though, things are not as impressive, since its Net Income dropped to $447 million, from above-700 millions in both the prior an the year-ago quarters, while its Operating Margin slumped to 8%.

Furthermore, Advanced Micro Devices Inc, offered reserved forward guidance for the third quarter, expecting Revenues in the range of $6.5 to $6.9 billion, with CEO Lisa Su saying that they have taken "a more conservative outlook on the PC business" during the earnings call. [7]

AMD.us dropped on Wednesday, despite record Revenues, as markets were apparently disappointed by the Q3 guidance. This is not enough to stop its recent rally, as it is set for the fifth straight week of gains.

Uber Blowout Quarter

The ride-hailing firm reported impressive results for the second quarter, before markets opened on Tuesday, in another strong report. Net Loss narrowed significantly, to $2.6 billion, while Gross Bookings hit a record of $29.1 billion - in line with the firm's forecast. [8]

Uber (UBER.us) was able to capitalize on the increased demand for traveling and high airport traffic, as Airport Gross Boking grew 139% on a yearly basis and 49% on a quarterly basis, outpacing the overall Mobility segment's recovery.

Revenue more than doubled from a year ago, to $8.1 billion, with the core Mobility business remaining the main generator, after surpassing the Delivery segment last quarter, which had supported the company during the Covid-19 lockdowns.

The San Francisco based firm, also provided upbeat guidance, expecting Gross Bookings Adjusted Profits (EBITDA) to rise in the third quarter.

CEO Dara Khosrowshahi, noted that driver engagement hit new post-pandemic highs in the reported quarter, which he called a "resounding endorsement" of the value drivers see in the firm, given the high gas prices. [9]

On Thursday, rival Lyft (LYFT.us) also reported a strong quarter, having generated Revenues of nearly $1 billion – representing double digits growth against both Q1 2022 and Q2 2021. Its Net Los widened compared to the previous quarter, to $377.2 million, but was lower than the loss of the year-ago quarter. [10]

UBER.us rallied nearly 20% on Tuesday after the solid report, heading for potentially its best week since late-2020.

Chinese EV Makers Deliveries

Li Auto Inc's deliveries of its ONE six-seater SUV, dropped on a monthly basis to 10,422 units in July, but they were up 21.3% year-over-year, with cumulative deliveries having reached 149,913 since the vehicles debut three years ago. [11]

This slowdown may have been due to the anticipation of the firm's new model, the L9 flagship SUV, which was unveiled in June. No deliveries have been made as of the latest report, but Li Auto (LI.us) had 30,000 orders as of June 24 for its newest vehicle. [12]

XPeng Auto handed over 11,524 last month, marking a 43% year-over-year bump, but a notable decline over the June figures. The firm has not sold any G9 SUVs yet, but plans to begin accepting reservation of its flagship SUV within the month. [13]

XPeng (XPEV.us) also said that it ranks No. 1 among emerging auto brands in China, with the 80,507 vehicles it delivered in the first seven months of 2022 and the 108% year-over-year increase this represented.

Nio (NIO.us) delivered 10,052 units, which similarly to its revivals, constituted growth on a yearly basis, but was lower compared to the prior month. The company faced supply chain issues, which constrained the production of its ET7 and EC6 models, but expects to accelerate production during the current quarter. [14]

The EV maker has been pushing into Europe and last week it announced its first plant in the continent, more specifically in Hungary. The factory will be operational in September and will develop and produce power products, such as power swapping stations. [15]

Just Eat Takeaway's Loss Narrowed

The Dutch multinational food delivery group saw its Loss narrowing by 29%, to €134 million (Adj. EBITDA) during the first half of the year, whereas it Revenues rose 7% from a year ago to €2.779. [16]

After a record 2021 H1 due to the pandemic though, Orders dropped 7% during the first half of 2022, but Gross Transaction Value remained steady, generating € 14.187 billion.

Just Eat (TKWY.nl) reaffirmed its full 2022 forward guidance for mid-single digits GTV growth and expects to break into profits (Adj. EBITDA) in the next year.

The firm's decision to buy US delivery platform Grubhub has not played out well, since it took a €3 billion impairment from the acquisition during the reported period. Despite having closed the transaction just a year ago, it is looking to offload Grubhub in full or partially.

Moreover, the Netherlands-based firm, had struck a commercial deal with tech and e-commerce giant Amazon.com last month, which would see the latter taking a stake in Grubhub.

TKWY.nl gained around 6% on Wednesday, as market liked the results, heading towards a profitable week.

Next Week (August 8-12)

The Walt Disney Company (Wednesday) dominates next week's earnings calendar, with its streaming service being one of the focal points, after rival Netflix reported less bad than feared subscriber losses last month.

Over in the UK, Deliveroo will be in the spotlight (Wednesday), after having slashed its 2022 guidance last month, now projecting Gross Transactions Value (GTV) growth of 4-12%, from 15-25% previously. [17]

Other than that, we will also be looking at Dutch multinational supermarket group Ahold Delhaize (AD.nl) (Wednesday) and Australian telecommunications giant Telstra Corporation Ltd (Thursday).

Nikos Tzabouras

Senior Market Specialist

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.

References

1

Retrieved 05 Aug 2022 https://www.bp.com/content/dam/bp/business-sites/en/global/corporate/pdfs/investors/bp-second-quarter-2022-results.pdf

2

Retrieved 05 Aug 2022 https://www.bp.com/content/dam/bp/business-sites/en/global/corporate/pdfs/investors/bp-second-quarter-2022-results-qa-transcript.pdf

3

Retrieved 05 Aug 2022 https://www.shell.com/investors/results-and-reporting/quarterly-results/2022/q2-2022/_jcr_content/par/toptasks_1119141760_.stream/1658963233980/ea8d3faec80bcc2622226933fa722b4955a5e83a/q2-2022-quarterly-press-release.pdf

4

Retrieved 05 Aug 2022 https://totalenergies.com/system/files/documents/2022-07/2Q22_Results.pdf

5

Retrieved 05 Aug 2022 https://corporate.exxonmobil.com/-/media/Global/Files/investor-relations/quarterly-earnings/earnings-announcements/2022-earnings-announcements/2q-earnings-release.pdf

6

Retrieved 05 Aug 2022 https://ir.amd.com/news-events/press-releases/detail/1084/amd-reports-second-quarter-2022-financial-results/

7

Retrieved 05 Aug 2022 https://ir.amd.com/financial-information

8

Retrieved 05 Aug 2022 https://investor.uber.com/news-events/news/press-release-details/2022/Uber-Announces-Results-for-Second-Quarter-2022/default.aspx

9

Retrieved 05 Aug 2022 https://s23.q4cdn.com/407969754/files/doc_financials/2022/q2/Q2-2022-Prepared-Remarks.pdf

10

Retrieved 05 Aug 2022 https://s27.q4cdn.com/263799617/files/doc_financials/2022/q2/LYFT-2022.06.30-Press-Release-(Quarterly)-(Q2-22).pdf

11

Retrieved 05 Aug 2022 https://ir.lixiang.com/news-releases/news-release-details/li-auto-inc-july-2022-delivery-update

12

Retrieved 05 Aug 2022 https://ir.lixiang.com/news-releases/news-release-details/li-auto-inc-takes-over-30000-li-l9-orders

13

Retrieved 05 Aug 2022 https://ir.xiaopeng.com/news-releases/news-release-details/xpeng-announces-vehicle-delivery-results-july-2022

14

Retrieved 05 Aug 2022 https://ir.nio.com/news-events/news-releases/news-release-details/nio-inc-provides-july-2022-delivery-update

15

Retrieved 05 Aug 2022 https://www.nio.com/blog/nio-power-europe-plant-commence-operation

16

Retrieved 05 Aug 2022 https://www.justeattakeaway.com/newsroom/en-WW/217001-half-year-2022-results

17

Retrieved 12 Aug 2022 https://dpd-12774-s3.s3.eu-west-2.amazonaws.com/assets/1816/5808/5558/Deliveroo_Q2_2022_Trading_Update_RNS_180722.pdf

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