Sector Snapshot
Sector Synopsis: Investors absorbed another deluge of earnings reports while closely watching the shifting tariff landscape. President Trump is expected to announce adjustments to soften auto tariffs, while some multinational companies are pulling forward or retracting guidance due to trade-related uncertainty. Across sectors, Q1 beats were plentiful but often paired with conservative forward outlooks. Consumer strength remains selective, and housing continues to feel macro drag. Semiconductors and fintech posted a mix of results, while energy traded lower alongside crude.
Retail, Consumer Staples & Restaurants:
Restaurant stocks slumped after McDonald’s reported its first decline in global comp sales since the pandemic. Consumer staples were broadly weaker after Church & Dwight and Estée Lauder cut outlooks, while Kimberly-Clark announced a $2B U.S. manufacturing expansion. Retail was mixed: Wayfair surprised to the upside, Kohl’s CEO was ousted, and mattress retailers flagged soft demand. Food names fell sharply despite solid beats from Hershey and Pilgrim’s Pride.
Autos, Leisure, Gaming & Lodging:
GM cut guidance by ~$4B–$5B due to tariffs, and Ford’s U.S. EV sales dropped 40% in April. Tesla denied reports of a CEO search. Chinese EV makers posted strong April delivery growth. Harley-Davidson pulled its 2025 outlook. Royal Caribbean beat but warned on back-half yield pressure. Lodging was mixed, with Hilton guiding down and Marriott acquiring citizenM.
Energy & Utilities:
Oil rebounded off lows, stabilizing the energy sector ahead of Exxon and Chevron earnings. Utilities outperformed, powered by nuclear-linked names (VST, CEG, OKLO) riding Meta’s capex push in AI.
Banks, Brokers, Asset Managers:
Robinhood (HOOD) beat estimates on surging deposits and trading activity, adding 1.9M accounts. ICE saw strong energy-related trading growth. Insurers mostly topped estimates, with Allstate, MetLife, and Prudential pointing to strong underlying earnings and investment income. Aflac was in-line.
Biotech & Pharma:
Lilly (LLY) beat on earnings but lowered its guidance; CVS dropped Zepbound from its PBM formulary. Moderna (MRNA) announced deeper cost cuts. Pfizer reaffirmed guidance but missed revenue. CVS topped across the board and raised full-year guidance. Biogen (BIIB) topped estimates on rare disease strength. SpringWorks and Madrigal both impressed. Arvinas tanked on halted trial plans.
Healthcare Services & MedTech:
Fallout from DOJ complaints sent SelectQuote, GoHealth, and eHealth lower. Teladoc (TDOC) cut full-year guidance on M&A and investment drag. Tandem Diabetes (TNDM) delivered record Q1 sales. Alignment and oncology screening names posted strong results. Glaukos (GKOS) and ICON (ICLR) both missed.
Industrials & Materials:
Caterpillar (CAT) upgraded post-earnings. AGCO and Quanta (PWR) beat expectations. CNH lowered its outlook. Packaging names (GPK, SW) flagged cautious customer behavior. Chemicals tumbled after Air Products and Ashland both cut full-year guidance. Paper weakness spread after IP and GPK earnings.
Aerospace & Defense:
Howmet (HWM) raised guidance and topped on strong demand. Bombardier (BBRDF) beat and guided for over 150 jet deliveries in 2025. RTX received U.S. approval for a major arms sale to Poland. Airbus agreed to acquire select Spirit AeroSystems sites. SAIC secured a $55M integration contract.
Internet, Media & Telecom:
Meta (META) jumped on a blowout quarter and higher capex forecast, lifting AI infrastructure names. Apple faced regulatory pressure despite solid earnings. Spotify beat on users but missed on revenue. Amazon denied plans to show tariff surcharges. Roblox (RBLX) raised FY bookings. Kohls (KSS) ousted its CEO amid an internal probe.
Hardware, Software & Semiconductors:
Microsoft crushed estimates and raised Azure growth guidance. Nvidia surged on Meta’s spending outlook and rumors of eased export restrictions. Qualcomm slipped on soft guidance. Cadence, PTC, and Ansys posted mixed results amid macro concerns. KLA and AEIS offered cautiously optimistic outlooks.
Featured Articles
Apple’s Earnings Solid, But Stock Slides on Antitrust Pressure: Despite solid quarterly results, Apple’s shares declined as investors digested a federal judge’s order that the company had failed to comply with a prior injunction in its antitrust fight with Epic Games.
Kohl’s CEO Ousted for Cause After Internal Investigation: Kohl’s terminated CEO Ashley Buchanan for cause after an internal investigation found violations of company policies tied to vendor relationships.
Apple Results Solid, But Investors Dump Shares Anyway: Apple beat earnings and revenue expectations, but lack of iPhone growth and lingering regulatory risks weighed heavily.
Amazon Posts Mixed Q1, Pushes Back on Tariff Surcharge Reports: Amazon posted solid AWS growth and reaffirmed full-year guidance but denied plans to list tariff surcharges on ultra-low-cost goods.
Microsoft Posts Unusually Strong Gain After Earnings: Microsoft posted better-than-expected results and raised cloud outlook, sparking a rally across enterprise tech names.
Airbnb Earnings Miss, But Travel Demand Holding Up: Airbnb Q1 earnings missed expectations slightly, but the company reiterated healthy summer bookings and guided to positive adjusted EBITDA for the year.
Inside the Earnings Call - Apple (AAPL)
Q2 FY2025 Earnings Call Summary
Theme | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 |
|---|---|---|---|---|
Revenue & EPS | $90.75B, $1.66 EPS beat | $117.2B, $2.10 EPS beat | $89.5B, $1.46 EPS beat | $81.8B, $1.26 EPS beat |
iPhone Performance | Slight y/y decline in sales | Flat y/y; mixed ASP commentary | Down y/y, tough compares | Up y/y but soft in China |
Services Revenue | $23.5B, +14% y/y | $23.1B, +11% y/y | $22.3B, +16% y/y | $21.2B, +8% y/y |
China Headwinds | Lingering weakness; regulatory scrutiny | “Challenging” demand conditions | Regulatory pressures noted | Inventory normalization |
Shareholder Return | $110B buyback announced | Modest dividend raise | Maintained payout | Focus on capital return |
Regulatory Risks | Judge ruled noncompliance with antitrust order | Ongoing Epic litigation | DOJ suit expected | Limited comment |
Takeaway for Investors
Apple continues to post solid results with strong services growth and aggressive capital return. But hardware revenue—especially iPhone—is stalling, and regulatory pressure is intensifying. The market is watching closely whether Apple’s AI strategy and international momentum can offset flatlining hardware trends and heightened legal risk.