Key Takeaways
- Thursday’s trading saw stock futures climb modestly as markets anticipated wholesale inflation figures for July
- Cisco shares declined 6% following earnings, even after surpassing estimates, due to year-over-year gross margin compression
- Cerebras Systems plummeted 17-19% following a significant earnings shortfall and quarterly losses
- StubHub experienced a 17% drop as escalating expenses negated revenue benefits tied to FIFA World Cup 2026
- Coherent stock fell 4.4% even after exceeding projections, pressured by elevated investor expectations following Lumentum’s impressive performance
Thursday’s market activity brought significant volatility as companies released their quarterly results. Market participants remained focused on upcoming wholesale inflation metrics for July, which could influence Federal Reserve policy decisions regarding interest rates.
Cisco Shares Decline Despite Revenue Beat
Cisco delivered fourth-quarter fiscal results showing revenue of $17.3 billion, marking an 18% year-over-year increase that exceeded analyst projections of $16.85 billion. The company’s adjusted earnings reached $1.22 per share, surpassing the anticipated $1.17.
However, shares tumbled 6% as the company’s gross margin contracted compared to the previous year’s corresponding quarter, triggering investor apprehension.
Cisco’s product order volume jumped 35% year over year, while networking orders climbed 40%, marking the eighth consecutive quarter of growth. The technology giant projected first-quarter fiscal 2027 revenue between $18 billion and $18.2 billion, exceeding analyst expectations. Full-year 2027 revenue guidance ranging from $72.2 billion to $73.4 billion similarly surpassed consensus forecasts.
Company executives anticipate generating $7.5 billion in AI-driven hyperscaler revenue during fiscal 2027, noting that hyperscaler orders more than doubled during the fourth quarter.
Cerebras and StubHub Report Disappointing Results
Cerebras Systems experienced a steep decline of 17% to 19% following the AI chip manufacturer’s substantial earnings disappointment. While revenue climbed 74.3% year over year to $180.1 million, it missed analyst expectations of $194 million. Adjusted earnings per share registered at -$2.98, significantly below the anticipated -$0.17.
The company’s core gross margin showed improvement, reaching 41%, while executives highlighted that cloud revenue nearly quadrupled compared to the prior year. Cerebras maintained its order backlog at approximately $25 billion.
Looking ahead, Cerebras provided third-quarter core revenue guidance of $214 million to $216 million, above analyst consensus. The company projects full-year 2026 core revenue between $880 million and $890 million.
StubHub shares sank 17% after delivering second-quarter losses. While the ticket resale marketplace benefited from revenue related to the 2026 FIFA World Cup, rapidly increasing operational expenses completely erased those revenue improvements.
Additional Market Movement
Coherent shares fell 4.4% despite reporting results that exceeded analyst expectations. The decline came as investors had positioned for exceptional performance following competitor Lumentum’s robust earnings earlier in the week.
JD.com declined 3.2% despite the Chinese online retailer surpassing Wall Street’s second-quarter profit and revenue projections.
Among the day’s gainers, Omeros jumped 15% following impressive second-quarter performance fueled by YARTEMLEA’s launch, which contributed $32.2 million in gross revenue, representing a 190% increase from the prior quarter.
Fossil climbed 7% after exceeding earnings forecasts and upgrading its full-year guidance. The company’s gross margin expanded by nearly 490 basis points to reach 62.4%.
Virgin Galactic dropped 11% after announcing a delay in its commercial service launch to February 2027, attributing the postponement to complications with avionics and systems development work.
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