To The Moon

After the big tech companies report, it's the turn of a large number of growth stocks to be tested. Coinciding with the Treasury bond auction, market liquidity is also suppressed, the overall tone is "difficult to rise and easy to fall".

Unless earnings are impeccable and investors with pricing power trade aggressively, the post-earnings rally is likely to be sustained. Otherwise, if one factor upsets the market, a plunge is possible.

Typical factors include concerns about increased competition, fully price-in , and disappointment at lower guidance.

Shopify - Increased Competition and Downward Growth

$Shopify(SHOP)$ Q1 results beat expectations, with revenue up 23% year-over-year and gross margin expanding to 51.4%, but Q2 will be down about 50 bps, with GAAP net income coming in at a loss of $0.21/share under GAAP net income, less than a year ago when it was a profit of $0.05/share.

The widening losses and projected decline in gross margins sparked investor concerns as it also signaled the company's difficulty in continuing to maintain its current profit margins amid increased competition in the market. $PDD Holdings Inc(PDD)$ Temu gives North American e-commerce to bring a competitive tone of value for money, $Amazon.com(AMZN)$ also follows.

Uber - Fully priced-in, declining growth

$YouBuy(UBER)$ Although the overall performance exceeded expectations, the growth of the taxi business declined significantly, with total turnover (BOOKINGS) growing 24.6% year-on-year, which was lower than the market's expectation by about 2.5%, and the overall MAU, core orders, and average passenger unit price of taxi and takeaway were lower than expected.

Gross margin was 39.1%, a slight increase of only 0.1% sequentially and a decline of 1.3% year-on-year, which was also lower than market expectations. Multiple factors, such as increased investment, exchange rate fluctuations, seasonal factors and product mix adjustment, may have led to a decline in Uber's Q2 gross profit margin compared to Q1.

Uber was moved into the S&P 500 index last year, the market also raised expectations for it, and the stock price rose quite a bit, corresponding to the current valuation is not low, so it is also part of the advance pricing. Post-earnings plunge is also part of profit-taking.

Airbnb - poor outlook, worrying prospects

$Airbnb, Inc.(ABNB)$ Also counting quite a bit in the last year, Airbnb's Q1 results were actually relatively better than expected, with year-on-year growth in total bookings slowing to 12% from 15% in the previous quarter, but better than expected, reflecting also higher pricing (3%) and even more increase in bookings (9%), as well as an improvement of 1.1% in gross margins, a decline of 3.9% in operating expenses, and operating margins of 4.7%, making overall Q1 results better than market expectations.

Guidance for Q2 was very conservative though, with revenues between $2.68-2.74bn, below expectations of $2.74bn, reflecting a weak outlook, and a slowdown in consumption worrying investors in the current inflationary environment.

Arm - overvalued and hard to carry

$ARM Holdings Ltd(ARM)$ Q1 results exceeded expectations, with revenue up 47% year-on-year, including a 60% jump in license revenue due to higher average prices. The company's number of licensed customers continued to rise, driven by growing demand for AI. Although the number of licensed chips declined due to the semiconductor cycle, single-chip license fees increased 53.1% year-over-year.

However, guidance for Q2 and the full year has slipped, and the market would argue that with high expectations for the AI industry as a whole, the company may be lagging the industry average.