Oh Snap | Stock Market is Screwed Now | Tank Incoming

TL;DR

Snapchat's disappointing second-quarter results and plans to slow hiring have caused its stock to plunge 25%, leading to negative market sentiments. Similarly, Corsair Gaming's preliminary unaudited revenue of $284 million, lower than expected, has resulted in a nearly 10% drop in its stock after hours.

Transcript

oh snap just when we are finally starting to make some dang money again in this market oh we got the vibes turning negative after hours i got to talk about what's going on two companies came out with numbers and essentially this is taking all the futures down i want to share my perspective on this share everything that's going on explain you guys w... Read More

Key Insights

• 🥺 Snapchat's earnings report and Corsair Gaming's preliminary results have led to negative market sentiments, affecting stocks of other major companies.
• 🛀 The market reaction shows the influence of one company's performance on others, even if they operate in different industries.
• 😀 Corsair Gaming's inventory buildup and delayed orders highlight the challenges faced by consumer discretionary companies due to macroeconomic factors.
• 😀 Both Snapchat and Corsair Gaming face uncertainties and the need to improve their financial performance.
• 🍉 The negative market sentiment following these reports presents potential buying opportunities for long-term investors.
• ✋ Corsair Gaming's future prospects, including new higher power GPUs and the release of Modern Warfare 2, may contribute to its recovery in 2023.
• 😄 The ease of comps in 2023 could allow Corsair Gaming to demonstrate significant growth in revenues, margins, and earnings per share.

Questions & Answers

Q: How did Snapchat's earnings report affect the overall market?

Snapchat's poor performance and lack of growth expectations for the third quarter led to negative market sentiments, causing stocks of other companies like Meta, Google, Twitter, and Amazon to drop after hours.

Q: Why did Corsair Gaming's stock decline after its preliminary results?

Corsair Gaming's lower-than-expected unaudited revenue for the quarter, coupled with excess inventory and delayed orders from channel partners, contributed to the stock's decline.

Q: How did Snapchat's earnings impact Amazon?

Snapchat's weak numbers affected Amazon's stock, although only by around 1%. However, this translates to a market capitalization loss of approximately $12 billion for Amazon.

Q: What are analysts' expectations for Corsair Gaming's earnings for 2022?

Analysts might revise their EPS estimates for Corsair Gaming to zero or close to it for 2022, considering the significant decline in revenue and excess inventory. This year is likely to be a challenging one for the company.

Summary & Key Takeaways

• Snapchat's second-quarter results were disappointing, with a loss of two cents per share and revenue of $1.1 billion, lower than expected. The company's decision to not provide guidance for the third quarter due to challenging visibility further impacted its stock.

• Corsair Gaming's preliminary unaudited revenue of $284 million, compared to analysts' expectations of around $350 million, resulted in a potential loss of $10-11 million for the quarter. The company attributed this to macroeconomic headwinds affecting consumer spending on gaming gear, leading to excess inventory.