Cisco Systems, a key player in networking hardware, experienced a decline of approximately 7% in after-hours trading following the announcement of its second-quarter financial results. The company’s non-GAAP gross margin was reported at 67.5%, slightly below the anticipated 68.1%. Although Cisco surpassed estimates in both revenue and earnings, its guidance for the upcoming quarter disappointed analysts.
In contrast, McDonald’s shares dipped by less than 1% after posting fourth-quarter earnings of $3.12 per share on revenues of $7.01 billion, which exceeded expectations of $3.05 per share and $6.84 billion in revenue.
AppLovin, a mobile technology firm, saw a decline of over 4% despite beating profit and sales estimates with fourth-quarter earnings of $3.24 per share on revenues of $1.66 billion. This performance comes amid a challenging year for AppLovin, with its stock down 32% year-to-date.
Fastly’s stock surged over 28% after it provided a favorable revenue guidance of $700 million to $720 million for the full year, significantly surpassing the $668 million expected by analysts. The company reported adjusted earnings of 12 cents per share on quarterly revenues of $172.6 million.
Conversely, Rollins, a pest control company, dropped over 16% following a disappointing earnings report, with a GAAP earnings of 24 cents, falling short of the 26 cents consensus. Its revenue also missed forecasts, coming in at $912.9 million versus the projected $926.8 million.
Paycom Software also faced a nearly 7% decline after presenting revenue guidance of $2.175 billion to $2.195 billion for the fiscal year ending December 2026, which was below analyst expectations of $2.23 billion.
Why this story matters: Market reactions to earnings reports can indicate investor confidence and affect stock prices.
Key takeaway: Company guidance can significantly impact stock performance, regardless of past earnings results.
Opposing viewpoint: Positive earnings can still lead to negative investor reactions if future expectations fall short.
