The recent earnings reports from major tech companies have significant implications for the cryptocurrency market, providing indirect benefits. Following a relatively positive meeting with the Federal Reserve, market watchers were eagerly anticipating the release of these earnings reports. The reports, as expected, exceeded forecasts, setting the stage for the upcoming meeting between Trump and Xi.
Impact of Earnings Reports on Cryptocurrencies
The above-expectation earnings from trillion-dollar tech companies are crucial for sustaining growth in risk markets. Companies like NVIDIA and other tech giants are becoming more valuable through AI-driven growth, prompting larger investments. This trend is pulling stock indices upwards and increasing the appetite for risk markets. Consequently, this positive performance also benefits Bitcoin and other cryptocurrencies.
Meta’s earnings were above forecasts, with revenue reaching $51.2 billion compared to an anticipated $49.59 billion. The company projects fourth-quarter revenue to be between $56 billion and $59 billion, surpassing the expected $57.38 billion.
Microsoft’s earnings per share were $3.72, exceeding the $3.67 estimate. Revenue reached $77.67 billion, surpassing expectations of $75.55 billion. The growth in Azure and Other Cloud revenues, excluding currency impact, was 39%, compared to an expected 37.1%. Intelligent Cloud revenue was $30.9 billion, beating the anticipated $30.18 billion.
Alphabet (Google) reported earnings per share of $2.87, outpacing the expected $2.26. Revenue was $102.35 billion compared to the forecasted $99.85 billion. Post-closing, shares increased by 2.5%, starting the next day at $275. Google Services revenue was $87.05 billion, exceeding the $84.67 billion estimate. Alphabet’s sales outperformed expectations due to Google Cloud’s growth, with operating income at $31.23 billion, slightly under the expected $32.11 billion.
eBay’s earnings per share were higher than expected, with net revenue at $2.82 billion, above the $2.73 billion prediction, and gross merchandise volume reaching $20.11 billion compared to the forecasted $19.37 billion. Active users were slightly below expectations at 134 million, against an anticipated 135.1 million. The company projects fourth-quarter net revenue to be between $2.83 billion and $2.89 billion, exceeding the $2.8 billion forecast. For the fiscal year, net revenue is estimated between $10.97 billion and $11.03 billion, above the $10.85 billion estimate.
Despite the positive earnings reports, Bitcoin has shown little reaction so far, as it also did not respond to the dovish tones from the Federal Reserve. However, subsequent movements may occur based on announcements or expectations following the meeting between Trump and Xi set for Thursday at 18:00. The appetite for ETFs will become apparent, and if it increases, Bitcoin could rise with the opening of the Asian markets.