Earnings Previews: IonQ, News Corp

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After U.S. markets closed on Tuesday, WeWork reported revenue that was better than expected but a loss per share that fell way short of expectations. The really bad news came in the SEC filing: “As a result of our losses and our projected cash needs, which have been impacted by the recent increases in member churn, combined with our current liquidity level, substantial doubt exists about the Company’s ability to continue as a going concern.”  Shares traded down by nearly 30% shortly after Wednesday’s opening bell.

Lyft posted a surprise earnings per share (EPS) profit of $0.16 while essentially meeting the consensus revenue estimate. Revenue rose by just $20 million sequentially and 3% year over year. The ride-sharing company’s competitive pricing move paid off, but only slightly. Investors were disappointed, and shares traded down by more than 9%.

Marathon Digital failed to meet consensus estimates for either EPS or revenue. Yet, shares traded up 3.5%.

Rivian beat expectations on both the top and bottom lines, topping the projected net loss of $1.43 per share by nearly 25%. Revenue doubled year over year, but raising production guidance from 50,000 to 52,000 units was not enough for investors. Shares traded down by around 1%.

Upstart also beat consensus estimates on the top and bottom lines, but it issued third-quarter revenue guidance of $140 million, about 10% below analysts’ expectations. Even worse, revenue dropped by 40% year over year. The stock traded down 21.6%.

Before markets opened on Wednesday morning, Roblox missed both EPS and revenue estimates. Lower demand for its online games and stiffer competition also hammered the bookings rate. Shares traded down by around 19% early Wednesday.

After markets close on Wednesday and before they open on Thursday, Alibaba, Coeur Mining and Walt Disney are expected to post quarterly results.

Here is a look at what analysts expect to hear from the following two companies when they share their quarterly earnings after Thursday’s closing bell.


Quantum computer maker IonQ Inc. (NYSE: IONQ) came public in a SPAC merger on October 1, 2021. Since then, the stock price has improved by about 67%, a good showing but not as great as the 240% gain after the company had been publicly traded for just six weeks. By late December of last year, the shares had fallen by 90% from that high. Since early February, when Microsoft announced its AI-powered Bing search engine, IonQ’s stock has risen by more than 225%. The stock was traded even higher a week ago, up by about 320% since February.

The betting seems to be that quantum computing will play a big role in teaching the large language models central to the effectiveness of artificial intelligence. In a blog post about quantum machine learning on the company’s website, IonQ notes that it has “the potential to generate better, more accurate machine learning models, especially when used to analyze complex data with many different variables” and promises “commercialization across a wide range of use cases.”
Just five analysts cover IonQ stock, and two of them have a Buy or Strong Buy rating. The stock trades at around $15.30, above the median price target of $11.00. At the high target of $17.00, the upside potential is about 11.1%.

Second-quarter revenue is forecast at $4.36 million, which would be up 1.76% sequentially and 67.0% higher year over year. The company is expected to post an adjusted loss per share of $0.08, compared to a loss per share of $0.12 in the prior quarter and a year-ago loss of $0.09 per share. For the full year, the net loss per share is forecast at $0.36, up from last year’s loss of $0.25 on revenue of $19.37 million, up 74% year over year.

IonQ is not expected to post a profit in 2023, 2024 or 2025. The enterprise value to sales multiple for 2023 is estimated at 139.4 times sales. For 2024 and 2025, that multiple is 67.9 times estimated sales of $39.74 million and 30.5 times estimated 2025 sales of $88.6 million, respectively. The company does not pay a dividend, and the total shareholder return for the past year was 150.08%.

News Corp

Media and information services company News Corp. (NASDAQ: NWSA) is among the country’s largest financial publishing companies, with ownership of The Wall Street Journal and Barron’s, along with voting control of Fox Corp.

Last month, a nonprofit group called the Media and Democracy Project (MAD) filed a statement with the Federal Communications Commission, arguing that the FCC should deny the renewal of Fox’s license to operate its Philadelphia-based TV station, WTXF. A former Rupert Murdock lieutenant, Preston Padden, filed a supporting statement: “Fox has undermined our democracy and has radicalized a segment of our population by presenting knowingly false narratives about the legitimacy of the 2020 election.” WTXF is one of 29 TV stations around the country owned and operated by Fox.

Just six brokerages cover the stock, and four of them have a Buy or Strong Buy rating. The other 2 say the stock is a Hold. At a share price of around $20.40, the upside potential based on a median price target of $24.50 is about 20.1%. At the high target of $30.00, the upside potential is 47%.

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