The coronavirus outbreak has hit the US stock markets hard. A lot of companies have been impacted with many of them having to scale down their production and reduce their guidance for the upcoming quarter. Many firms have been unable to determine the exact financial impact on their businesses in light of the fluid situation, and it remains to be seen whether the effect of the outbreak will spill on to future quarters as well.
In the past one month, several leading companies have cut their guidance for the April quarter. Here are five of the major ones:
On its second quarter 2020 conference call, Microsoft (NASDAQ: MSFT) had guided for revenues in the range of $10.75-11.15 billion for its More Personal Computing segment, which was wider than usual due to the public health situation in China. Last month, the company said it does not expect to meet this guidance as Windows OEM and Surface have seen a more negative impact than expected. Microsoft’s stock dropped 5% in the past one month.
Apple (NASDAQ: AAPL) had guided for revenues of $63-67 billion for its second quarter of 2020 at the end of January. Last month, the company stated that it does not expect to meet its revenue guidance due to iPhone supply shortages and a drop in demand for its products in China. Apple’s stock fell 6% over the past one month.
HP Inc. (NYSE: HPQ) said on its Q1 2020 conference call that it expects its topline, bottom line and free cash flow to be negatively impacted by the coronavirus situation. The company has factored in an $0.08 EPS impact into its Q2 2020 guidance. For the second quarter, GAAP EPS is expected to be $0.46-0.50 and adjusted EPS is estimated to be $0.49-0.53.
The Coca-Cola Company (NYSE: KO) said it estimates an approximate 2-3 point impact to unit case volume and a 1-2 point impact to organic revenue for the first quarter of 2020. EPS is expected to be impacted by $0.01-0.02 in Q1.
Mastercard (NYSE: MA) said that cross-border travel and cross-border ecommerce growth have been impacted by the coronavirus and if the trends continue, the company’s Q1 2020 net revenue growth will be approx. 2-3% lower than its previous guidance. Net revenue growth, on a currency-neutral basis, excluding acquisitions, is expected to be 9-10%.
Despite the prevailing uncertainty, all these stocks were trading in positive territory at midday on Monday. Microsoft was up 3.2%, Apple was up 6.4%, HP was up 2.6%, Coca-Cola was up 2.6% and Mastercard was up 2.4%.
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