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Salesforce, Dell & Broadcom Earnings: What to Expect?

Plus500 | Tuesday 29 August 2023

This week will provide traders and investors with an overview of how some of their favorite tech companies performed over the past quarter as Salesforce, Dell, and Broadcom are set to report their quarterly earnings. Here’s what you can expect:

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Can AI Give Salesforce a Boost as Well?

Due to the significant attention garnered by Artificial Intelligence (AI) recently and NVIDIA’s impressive earnings last week being largely attributed to AI, it may not come as a surprise to learn that investors and analysts may now be focused on how Salesfoce’s AI efforts have helped its stock. 

Accordingly, American cloud-computing company, Salesforce (CRM) is expected to report its Q2 earnings on Wednesday, August 30, after the ring of the bell. The data will not only provide traders and investors with access to the companies’ financial growth but can also show whether or not its AI efforts have helped it this quarter. 

Evidently, Salesforce has made it one of its missions to integrate AI into its products, and in June the company announced that it will provide customers with an “AI Cloud starter pack,” which customers are already using. CEO, Marc Benioff, even called this a “breakthrough” and stated that Salesforce’s “customer relationship management area of Artificial Intelligence” is unmatched.

Nonetheless, whereas the prospect seems promising, analysts appear to be a bit doubtful and may still be reserved regarding Salesforce’s AI growth. According to a Morgan Stanely (MS) report “with a limited catalyst path, particularly given timing to realize benefits from Gen AI, we remain on the sidelines.”

As for the numbers, according to Zacks Consensus Estimate, the company’s total Q2 revenues are expected to come in at $8.52 billion which would be 10.4% above last year’s quarter’s numbers. EPS is estimated to come in at $1.90 which would be an increase of about 60% YoY. 

Moreover, since the beginning of the year, Salesforce grew by a whopping 57% and it may also be interesting to note that throughout the last four quarters, Salesforce was able to exceed Zacks’ estimates. However, whether or not it will be able to maintain this trend is yet to be seen. 

SALESFORCE PRICE CHART SINCE THE BEGINNING OF 2023 UP TILL 29.08.23

Dell’s Earnings: How Did the PC-Maker Fare?

PC manufacturer and technology supplier, Dell (DELL) is expected to report its Q2 of fiscal 2024 earnings this week on Thursday, August 31, after market close. Following its latest earnings report on June 1st, whereby the company exceeded expectations, traders and analysts may be interested in seeing how Dell will perform this time around. 

Dell is expected to report an EPS of about $1.13 which is below last quarter’s $1.31. If these predictions materialize, then it would be a YoY decrease of 32.74%. As for revenue, some analysts expect Dell to report a revenue of $20.84 billion which would be slightly below last quarter’s $20.92 billion.

Still, despite these possibly gloomy forecasts, Dell has risen by 39.8% since the beginning of the year. In addition, it may also be worth noting that Dell has made positive headlines this month as it partnered with Intel (INTC) to develop cloud models that help organizations that offer hybrid working environments.  

DELL PRICE CHART SINCE THE BEGINNING OF 2023 UP TILL 29.08.23

Furthermore, more recently, on August 23, it was revealed that Credit Suisse AG had increased its position of Dell by 10.3% during Q1. Traders may also want to keep in mind that on August 4th, Dell also announced a quarterly dividend which provided some shareholders with a dividend payment of $0.37 per share. This news may have highlighted Credit Suisse’s confidence in the tech company.  As such, it will be interesting to see what Thursday’s upcoming earnings report will look like and how it might affect the company’s trajectory. 

Will Broadcom Live Up to the Expectations?

Another tech leader set to report its earnings this Thursday after market close is semiconductor and software manufacturer Broadcom (AVGO)

Broadcom, which has gained more than 55% so far this year, is expected to reflect this growth in its upcoming report. According to the Zacks Consensus Estimate, the company is projected to report an EPS of $10.42, marking a 7.09% rise from the year-ago quarter. Revenues are expected to reach $8.86 billion, which would be 4.64% higher than the year ago’s quarter.

broadcom price chart since the beginning of 2023 up till 290823

Like many of its tech peers, Broadcom’s growth is also expected to be related to AI. Accordingly, the company believes that its generative AI technology will surpass $1 billion. Additionally, AI demand is also expected to have boosted sales for Broadcom’s networking solutions, like Tomahawk 4 and Jericho switches. Nevertheless, Broadcom expects its income from storage adapters to slow down. Also, telecom companies spending less money might have harmed the company’s 5G deployments. Traders and analysts alike will have to wait and see whether these predictions will materialize or not. (Source:Zack’s)

Conclusion

In light of this year's rate hikes, inflation, and AI hype, the markets may get more information about the tech sector this week. It is therefore helpful to keep track of the results in the near future and to note how these might affect stock prices and market sentiment.


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