Beta Finch - S&P 100 - EN

More earnings analysis: https://betafinch.com
Groups: INDUSTRIALS (https://betafinch.com/groups/INDUSTRIALS)
──────────
ALEX: Welcome to Beta Finch, your AI-powered earnings breakdown, where we take the numbers and the noise from corporate earnings calls and turn them into something you can actually digest. I'm Alex.

JORDAN: And I'm Jordan. Today we're digging into Deere & Company's third quarter fiscal 2026 results — big green tractors, big infrastructure equipment, and a business that's basically riding two different economic cycles at once.

ALEX: Before we get into it — this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: Good, let's get into the numbers. Alex, what jumped out at you?

ALEX: The headline is Deere beat expectations pretty handily. Net sales and revenue up 5% to $12.6 billion, equipment operations sales up 6% to $11 billion, net income of $1.38 billion, or $5.10 a share. And that 14.4% operating margin for equipment operations is genuinely strong given how choppy the ag market is right now.

JORDAN: Right, and that's really the story of this quarter — a tale of two businesses. Production & Precision Ag, their big-tractor and combine segment, was actually down 6% year-over-year to $4 billion, with margins around 13.2%. That's the segment feeling the ag downturn most directly.

ALEX: But then you flip to Small Ag & Turf — up 12% to $3.4 billion with an 18.4% margin — and Construction & Forestry, up 18% to $3.6 billion with a 12.1% margin. Those two segments are basically carrying the company through the ag trough.

JORDAN: That diversification point came up again and again on the call. Management kept saying it — while big ag equipment is struggling, construction and the smaller ag/turf business are picking up the slack. It's a nice illustration of why a diversified portfolio actually matters in a cyclical industry.

ALEX: Let's talk guidance, because they actually raised the full-year outlook despite trimming some segment numbers. Full-year net income guidance moved up to $4.75 to $5 billion, and operating cash flow guidance improved to $5 to $5.5 billion.

JORDAN: But within that, Production & Precision Ag guidance came down — now expecting sales down about 10% for the year, with margin guidance narrowed to 11-12%. That's mostly South America and Europe softness. South America specifically is now guided down 15-20% for the year, driven by high interest rates and elevated fertilizer costs squeezing farmer economics.

ALEX: Meanwhile Small Ag & Turf guidance actually went up — margin guide raised to 14.5-15.5% — and Construction & Forestry held its roughly 20% sales growth guide with margins tightened to 10.5-11.5%. Construction is genuinely firing on all cylinders right now: data centers, infrastructure, road building.

JORDAN: One thing worth flagging for listeners — tariffs were a huge theme on this call. Deere now expects about $1.1 billion in direct tariff expense for the year, offset partially by $382 million in IEPA refunds recognized so far. CFO Brent Norwood said net tariff exposure this year is around $750 million, but he flagged that it'll actually step up to roughly $1 billion next year as the refund benefit doesn't repeat.

ALEX: That's an important nuance — investors hear "tariff relief" and assume it's all good news, but the mechanics here mean next year could actually be a modest headwind, not a tailwind.

JORDAN: The other big storyline was the model year 2027 early order programs — these are essentially pre-orders dealers and farmers lock in ahead of the season. Deanna Kovar, who runs the ag and turf business, said combined planter and sprayer orders are running up mid-single digits versus last year.

ALEX: And that's a meaningful signal because management explicitly said they view 20

This episode includes AI-generated content.

More earnings analysis: https://betafinch.com
──────────
ALEX: Welcome to Beta Finch, your AI-powered earnings breakdown. Today we're digging into Cisco's fiscal Q4 and full-year 2026 results — and Jordan, this one's a doozy.

JORDAN: Record year across the board. I'm ready.

ALEX: Before we dive in — this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: Good, now let's get into it. Cisco just closed out fiscal 2026 with revenue over $63 billion, up 12% for the year. But the real headline is Q4 — record revenue of $17.3 billion, up 18% year-over-year, and product revenue up 24%.

ALEX: And it's not just top-line. Non-GAAP EPS grew 23% in the quarter, 14% for the full year — so earnings actually outgrew revenue. That's the kind of operating leverage investors love to see.

JORDAN: Right, and they backed it up with cash returns — $3.2 billion returned to shareholders in Q4 alone, $12.7 billion for the year, which was basically 99% of free cash flow. Fifteenth consecutive year of dividend increases too.

ALEX: So what's driving all this? One word CEO Chuck Robbins used a lot: "super cycle." He's talking about a networking super cycle fueled by agentic AI. Product orders overall were up 35% year-over-year, and hyperscale orders — meaning the big cloud players — grew triple digits.

JORDAN: That AI infrastructure number is wild. Cisco took $4 billion in AI orders from hyperscalers in Q4 alone, bringing the full-year total to $9.3 billion — that's about 4.5 times what they did the year before. And for fiscal 2027, they're guiding to $7.5 billion in actual AI infrastructure revenue.

ALEX: Worth noting — orders and revenue aren't the same thing. These are big, lumpy, non-linear deals that get placed way ahead of when they actually ship and get recognized as revenue. That's an important nuance analysts pressed on during Q&A.

JORDAN: They also talked about this "scale-across" opportunity — basically connecting multiple data centers together as AI models outgrow the power and space of a single facility. Cisco says traffic from that kind of AI-driven interconnect could be 14 times what traditional data center traffic looked like. They've already landed three separate hyperscaler design wins for their new P200 chip system aimed at exactly that use case.

ALEX: And it's not just hyperscalers. Enterprise product orders accelerated to 21% growth, public sector orders were up 30%, and campus networking — which is basically the corporate office refresh cycle — grew 20%, with Wi-Fi 7 now over half of wireless orders.

JORDAN: Security was a bright spot too — the whole security portfolio including Splunk grew double digits, firewall orders were up over 30%. Though CFO Mark Patterson did flag that some of that 14% revenue growth in security got a boost from a few larger, longer-duration on-prem Splunk deals — so temper expectations there slightly.

ALEX: One thing that stood out to me in the Q&A: analysts kept asking, "Is this the peak of the cycle?" And Chuck Robbins pushed back hard, saying they're seeing convergence of multiple tailwinds at once — AI buildouts, a looming end-of-support product refresh they're calling "Mythos," and even early quantum-readiness spending.

JORDAN: Yeah, that Mythos comment was interesting — he described a manufacturing CEO's team calling in saying essentially "we have no choice, we have to upgrade equipment that's past end of life." Robbins framed it like the early days of cybersecurity spend — something that stops being optional and just becomes a line item companies find budget for.

ALEX: Now, not everything was pure upside. Gross margins came in at 66.3%, down 210 basis points year-over-year, mostly due to higher hardware mix and memory costs. Management said to expect continued gross margin pressure i

This episode includes AI-generated content.

More earnings analysis: https://betafinch.com
──────────
**BETA FINCH: SALESFORCE Q2 FY2027 EARNINGS BREAKDOWN**

ALEX: Welcome to Beta Finch, your AI-powered earnings breakdown. I'm Alex.

JORDAN: And I'm Jordan. Today we're diving into Salesforce's fiscal Q2 2027 results — and this one came with a genuinely wild product announcement dropped mid-call.

ALEX: Before we get into it — this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: Okay, so let's start with the headline: right before this call, Marc Benioff and Anthropic's Dario Amodei went on CNBC together to announce "Claudeforce" — a joint product combining Anthropic's Claude with Salesforce's CRM data and workflows.

ALEX: Right, and the pitch is basically: Claude brings the reasoning and the interface, Salesforce brings the trusted data, permissions, and business logic underneath it. Benioff's framing was "one plus one equals three."

JORDAN: It's a notable pairing given all the "SaaSpocalypse" chatter — the idea that AI agents would just cannibalize traditional software companies. Benioff spent a huge chunk of this call directly pushing back on that narrative.

ALEX: And he had numbers to back it up. Net new annual contract value growth — basically new bookings — was the strongest it's been in four years. Attrition was near an all-time low. Contract lengths got longer across every segment.

JORDAN: Let's get into the actual financials, because the quarter itself was solid. Revenue came in at $11.35 billion, up 11% year-over-year, above the high end of guidance. Subscription and support revenue was $10.82 billion, up 12%.

ALEX: Current remaining performance obligations — CRPO, which is a good forward-looking bookings indicator — accelerated to 14% growth in constant currency, a point ahead of guidance.

JORDAN: Free cash flow was the standout for me: $1.1 billion, up 81% year-over-year. Non-GAAP operating margin held at 34.1%.

ALEX: And on the AI-specific numbers — Agentforce, their AI agent product, hit $1.5 billion in ARR. Bookings for their premium AI bundles more than doubled quarter-over-quarter. Agent usage through API-style calls surged sixfold.

JORDAN: Sixfold in a single quarter is a big number. And COO Miguel Milano added some texture in Q&A — bookings for Agentforce roughly doubled year-over-year, they added 2,000 new paying customers into production, up 70% quarter-over-quarter.

ALEX: They also raised full-year guidance — about $300 million in constant currency, split between organic growth and an expected contribution from two pending acquisitions, Contentful and the customer-service AI company Fin, both expected to close soon. New FY2027 revenue guide is $46.1 to $46.4 billion.

JORDAN: Now, the Claudeforce reveal aside, I want to flag something structural that came up a few times: Salesforce is explicitly moving toward what they're calling "headless" delivery and outcome-based pricing.

ALEX: Meaning instead of just charging per user seat, they want to meet customers with flexible pricing — consumption-based, credits, or even tied to business outcomes, like "we generated you more revenue, so we take a cut."

JORDAN: Milano gave a specific example — a digital platform customer whose AI agent usage grew 14x in a quarter, and Salesforce is now negotiating either a $40 million outcome-based deal or an unlimited usage agreement. That's the kind of expansion story investors want to hear, because it suggests real pricing power beyond the traditional seat model.

ALEX: There was also a fun anecdote in the call — Ohalo's CEO David Friedberg joined as a guest and talked about how he almost built his own CRM instead of buying Salesforce, then ended up standing the whole thing up in under a month using Claude and Cursor alongside a Salesforce engineer. Hi

This episode includes AI-generated content.

More earnings analysis: https://betafinch.com
Groups: INDUSTRIALS (https://betafinch.com/groups/INDUSTRIALS)
──────────
Welcome to Beta Finch, your AI-powered earnings breakdown of the companies moving the markets. Let's get into Caterpillar's second quarter.

ALEX: Hey everyone, welcome back to Beta Finch! I'm Alex, joined as always by Jordan, and today we're digging into Caterpillar's Q2 2026 results — and folks, this is a big one. But before we dive in, quick reminder: this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: And it's a good quarter to have that disclaimer front and center, Alex, because the numbers here are eye-popping. Caterpillar just posted $20.5 billion in sales and revenues — up 24% year-over-year. That's the first time in company history they've cracked $20 billion in a single quarter.

ALEX: A genuine milestone. And it wasn't just the top line — adjusted profit per share came in at $8.17, up 73% from last year. CEO Joe Creed called it out as a record, and honestly, the whole print beat expectations across the board.

JORDAN: What really stands out to me is the backlog. It grew sequentially by $9 billion to $72 billion total — that's up 92% versus a year ago. And all three primary segments — Construction Industries, Resource Industries, and Power & Energy — contributed to that growth. This isn't a one-segment story.

ALEX: Right, and that Power & Energy segment is the one everyone's buzzing about because of the AI and data center angle. Sales to users in power generation grew 72% — driven by demand for large gen sets and turbines going into data centers.

JORDAN: It's wild — they're literally restarting a discontinued product line for this. They stopped making their 10-megawatt medium-speed gas reciprocating engine back in 2022, and now they're bringing back about 1.5 gigawatts of capacity because customers are asking for more units. Shipments start in Q4.

ALEX: And on the call, an analyst pushed Creed on whether that demand has real staying power out to 2028, 2029, 2030 — given how much AI capex speculation is out there. Creed's answer was pretty direct: "No one is slowing down at the moment. In fact, if we can get more units out, they're asking us to give them more units." They're already taking orders into 2029 and 2030.

JORDAN: And it's not just data centers propping this up — that's the part I found reassuring. Oil and gas backlog is nearly double what it was a year ago, mostly gas compression demand. So even if the AI narrative cools at some point, there's a broader base under this Power & Energy growth story.

ALEX: Let's talk Construction Industries too, because that segment had its own headline moment — sales up 35% to $8.3 billion, sixth straight quarter of sales-to-users growth. A lot of that was rental fleet loading, including this new "Major Projects" joint venture with dealers — basically a national rental fleet aimed at massive infrastructure and data center builds.

JORDAN: Margins there were strong too — 23.3%, up 320 basis points. Resource Industries also chipped in with 20% sales growth, helped by mining demand for copper and gold, plus they closed the Skycatch acquisition in July — that's AI-powered spatial data tech for mining operations.

ALEX: Now, we can't ignore tariffs — they came up a lot on this call. CFO Kyle Epley said the company got a $392 million benefit from IEEPA tariff recoveries this quarter, and actual tariff costs came in lower than expected, around $400 million versus the $700 million they'd guided to in April. For the full year, they now expect about $2.2 billion in tariff costs, the low end of their prior range.

JORDAN: That's a meaningful swing, and it's part of why margins beat — adjusted operating profit margin hit 21.9%, up 430 basis points year-over

This episode includes AI-generated content.

More earnings analysis: https://betafinch.com
Groups: RETAIL (https://betafinch.com/groups/RETAIL)
──────────
**BETA FINCH — Booking Holdings (BKNG) Q2 2026**

ALEX: Welcome to Beta Finch, your AI-powered earnings breakdown. I'm Alex.

JORDAN: And I'm Jordan. Today we're digging into Booking Holdings' second quarter 2026 results.

ALEX: Before we get into it — this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: Good to have that on record. So, Alex, headline here: Booking beat guidance across the board again.

ALEX: Yeah, and in a genuinely messy environment too. Room nights grew 5%, gross bookings up 9% — or 8% constant currency — revenue up 8%, and adjusted EBITDA hit about $2.6 billion, up 9%. All of that came in above the high end of their own guidance.

JORDAN: The EPS number is the one that jumps out to me — $2.54, up 15% year-over-year. That's growing faster than EBITDA, and a big chunk of that is financial engineering: a 6% reduction in share count from buybacks.

ALEX: Right, and they weren't shy about it — $3.7 billion in repurchases this quarter alone, $7.4 billion for the first half at an average price around $173 a share. Plus they returned $4.1 billion total to shareholders, a record quarter for capital returns.

JORDAN: Now here's the context that matters — this wasn't a clean quarter. CFO Ewout Steenbergen was pretty direct about the Middle East conflict weighing on long-haul international travel, airline capacity, and flight prices. That hit international room nights, which only grew "slightly," versus domestic room nights growing high single digits.

ALEX: And flights specifically decelerated to just 4% growth, rental cars were soft too. But management framed that as almost entirely exogenous — Steenbergen actually said their flights business is outperforming the broader airline industry, which was hurt worse by the same dynamics.

JORDAN: Let's talk regions for a second, because there's a real divergence. Europe grew mid-single digits, Asia mid-single digits domestically hit especially hard by Strait of Hormuz exposure, and the U.S. — high single digit room night growth, which CEO Glenn Fogel was clearly proud of.

ALEX: He called it out multiple times — said the U.S. has been a multi-year investment priority and they're "doing something right." Direct channel growth in the U.S. continues too, which matters because it's cheaper customer acquisition.

JORDAN: Speaking of which, can we talk about the SEO comment? That was one of the more candid moments on the call. An analyst pushed on whether AI Overviews in Google search are pressuring organic traffic, and Fogel basically confirmed it — said the AI overview changes at Google "definitely put some pressure on SEO."

ALEX: But he was quick to add SEO was always a small slice of the business, and their direct booking mix held steady in the mid-60% range. Their read is that people who used to arrive via SEO are just finding them another way — the absolute direct number kept growing.

JORDAN: The AI thread ran through basically the entire Q&A. Multiple analysts asked variations of "is AI actually moving the needle yet?" And the honest answer from management was — not really, not yet, at least not visibly.

ALEX: Steenbergen gave a specific number here that I think listeners should note: traffic coming from large language models, both paid and organic, is still "significantly below 1%" of room nights, and it hasn't moved much in recent quarters.

JORDAN: So despite all the AI-powered discovery rollouts — Booking.com's new inspiration search, Priceline's Penny assistant, Agoda's gallery view — the actual booking impact is still tiny. Management's line was essentially "we're positioned well for whenever this shifts, but it hasn't shifted yet."

ALEX: Where AI

This episode includes AI-generated content.

More earnings analysis: https://betafinch.com
──────────
Welcome to Beta Finch, your AI-powered earnings breakdown of the companies moving the market. I'm Alex, and I'm here with Jordan, and today we're digging into AppLovin's second quarter 2026 results.

ALEX: Before we get into it, quick disclaimer — this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: And this one's actually a pretty interesting story, Alex, because it's a rare miss for AppLovin.

ALEX: Right, so let's start with the numbers. Revenue came in at $1.92 billion for the quarter, up 53% year-over-year, but that landed just below the midpoint of guidance. Adjusted EBITDA was $1.61 billion, up 58% year-over-year with margins expanding about 300 basis points — but again, just under the guided range.

JORDAN: And CEO Adam Foroughi was pretty direct about it right out of the gate. He basically said, "we fell short of our own standard." Which, for a company that's been beating and raising for something like twelve straight quarters, is notable.

ALEX: So what actually happened? It comes down to their AI models. AppLovin's whole growth engine is model performance — better models mean advertisers can spend more profitably at their target return on ad spend. This quarter, the pace of model improvement was just lighter than usual. The "next step up," as Foroughi called it, landed just after the quarter closed instead of during it.

JORDAN: Which is really a timing issue, not a demand issue. That distinction matters a lot here. He pointed out that MAX, their publisher marketplace, grew double digits quarter-over-quarter, and their share of ad inventory stayed consistent. So advertisers weren't pulling back — the models just didn't get their usual mid-quarter boost.

ALEX: And now that the new model is live in Q3, they're saying the business has already re-accelerated.

JORDAN: The other big storyline is the consumer business — that's their e-commerce and web advertising push. Advertiser spend hit a record, 28% above Q4 2025 levels, and Q4 is normally their seasonal peak. Growing past peak-season levels in what's usually a slow quarter is a pretty strong signal.

ALEX: Right, and CFO Matt Stumpf made clear the higher costs this quarter were deliberate — they're investing in more complex, compute-hungry model architectures, and that spending is tied directly to the performance gains they're now seeing in Q3.

JORDAN: There's also a fun detail buried in there — they officially opened their ad platform to the public in June under the AppLovin Ads Manager name. Remember, this used to be branded AXON, then it went back to AppLovin.

ALEX: Foroughi joked they "can't get rid of the name AppLovin" — everyone just kept calling them that no matter what they rebranded to.

JORDAN: What stood out to me in the Q&A was the partnership strategy. They're now doing deals with companies like attribution and analytics platforms — Triple Whale got called out by name — to funnel in mid-market advertisers in a targeted way, rather than just opening the floodgates to long-tail signups.

ALEX: Which makes sense given where their model sophistication is. Foroughi was pretty candid that gaming is a mature, well-oiled machine at this point — new games hit their return targets almost immediately — but e-commerce is still early. Small shops don't always have the budget or the creative assets to make it work yet. Mid-market is the sweet spot right now.

JORDAN: One thing worth flagging for listeners — there was a housekeeping item. AppLovin confirmed the SEC concluded its previously disclosed voluntary inquiry with no recommended action. So that overhang is officially resolved.

ALEX: Also notable: free cash flow came in at $863 million, lower than normal due to timing of international tax and i

This episode includes AI-generated content.

More earnings analysis: https://betafinch.com
Groups: CHIPS (https://betafinch.com/groups/CHIPS), AI_LEADERS (https://betafinch.com/groups/AI_LEADERS)
──────────
**BETA FINCH — AMD Q2 2026 EARNINGS BREAKDOWN**

ALEX: Welcome to Beta Finch, your AI-powered earnings breakdown. I'm Alex, joined as always by Jordan, and today we're digging into Advanced Micro Devices — AMD — and their second quarter 2026 results. Jordan, this one's a big one.

JORDAN: It really is. Record revenue, and the guidance for next year is honestly kind of stunning. Let's get into it.

ALEX: Before we do — quick disclaimer. This podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: Good to have that up front. Okay, let's talk numbers.

ALEX: AMD posted revenue of $11.5 billion for Q2, up 50% year-over-year and 13% sequentially. That's their sixth straight quarter of greater-than-30% growth, which is a pretty remarkable streak.

JORDAN: And the story underneath that number is really about data center. It's now 58% of total revenue, up from 42% a year ago. Data center segment revenue was $6.7 billion, more than doubling year-over-year. Split that in two: server CPUs — that's EPYC — grew over 70% in both cloud and enterprise, fifth consecutive quarter of record server CPU revenue. And Instinct, their AI accelerator line, more than doubled.

ALEX: Profitability kept pace too. Gross margin hit 56%, up over 200 basis points year-over-year. Operating income was $3.1 billion, a 27% operating margin. And non-GAAP diluted EPS grew about 82% year-over-year — meaningfully outpacing revenue growth.

JORDAN: That's the operating leverage story playing out in real time.

ALEX: Client and gaming was more mixed. Client — that's PCs — grew 23% to $3.1 billion on record mobile processor sales and strong commercial Ryzen PRO adoption. But gaming dropped 31% to $779 million, mostly semi-custom console revenue fading late in that console cycle, plus some pricing pressure on graphics cards from component costs.

JORDAN: Embedded was a bright spot too — up 19% to $977 million, their strongest growth in three years, with networking and defense customers leading the way.

ALEX: Now let's talk strategy, because this is where CEO Lisa Su really leaned in. The headline announcement was Helios — their new rack-scale AI platform combining EPYC Venice CPUs, MI450 GPUs, networking, and their ROCm software stack.

JORDAN: And the customer list here is the story. They already had multi-generation, gigawatt-scale commitments with OpenAI and Meta. Now add a brand-new strategic partnership with Anthropic — up to 2 gigawatts of MI450 GPUs, with the first gigawatt deploying in early 2027. There's also a joint engineering piece where Anthropic's Claude models help optimize workloads for AMD's chips.

ALEX: And Microsoft is expanding its footprint too, deploying Helios at scale on Azure for frontier model inferencing.

JORDAN: What stood out to me is how much AMD raised its own long-term targets. They now expect the AI accelerator market to hit roughly $1.4 trillion by 2030, and the server CPU market around $220 billion. Combined, they're calling the total high-performance and AI computing market close to $2 trillion by 2030.

ALEX: And Lisa Su said flatly that AMD is tracking materially ahead of the long-term model they laid out at last November's Analyst Day — revenue growth well above their prior 35% target, and EPS expected to "significantly exceed" their $20 target.

JORDAN: That's a big statement to make less than a year after setting those targets.

ALEX: Let's get into guidance. For Q3, AMD is guiding to about $13 billion in revenue, plus or minus $300 million — that's 41% year-over-year growth at the midpoint. Gross margin guided at approximately 56%.

JORDAN: And looking further out, th

This episode includes AI-generated content.

More earnings analysis: https://betafinch.com
Groups: CHIPS (https://betafinch.com/groups/CHIPS)
──────────
ALEX: Welcome to Beta Finch, your AI-powered earnings breakdown, coming to you fresh off Applied Materials' fiscal third quarter 2026 report. I'm Alex, joined as always by Jordan. Before we dive in — this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: And this was a big one, Alex. Applied Materials just posted the highest quarter-over-quarter revenue growth in company history.

ALEX: Let's start with the numbers. Q3 revenue came in at $9.1 billion — up 15% sequentially and 25% year-over-year. Non-GAAP gross margin hit 50.4%, and operating margin expanded to a record 34%. EPS was $3.50, up 41% year-over-year.

JORDAN: And it's not slowing down — Q4 guidance is $10.25 billion, plus or minus $500 million, which would be up 51% year-over-year. EPS guide of $4.02, up 85% year-over-year. Those are eye-popping growth rates for a company this size.

ALEX: The story here is really AI infrastructure. CEO Gary Dickerson framed it as two races happening at once: a race for technology leadership and a race for capacity. Chipmakers can't build fast enough to meet AI demand.

JORDAN: Right, and Applied's positioned right at the intersection — leading-edge foundry logic, DRAM, and advanced packaging. Management said those three areas represent roughly 80% of wafer fab equipment growth in both 2026 and 2027. DRAM revenue alone grew 52% year-over-year, and packaging revenue is now expected to grow more than 70% for the calendar year.

ALEX: What stood out to me was the visibility. CFO Brice Hill said some customers are now giving them rolling eight-quarter forecasts, and in some cases conversations stretching out to 2030.

JORDAN: That's unusual for this industry, which has historically been pretty cyclical and choppy. Longer-term agreements mean Applied can plan supply chain and manufacturing capacity with much more confidence. They're actually building toward doubling their quarterly system output by 2028.

ALEX: Doubling. That's a serious bet on sustained demand.

JORDAN: And to be fair, management was careful to clarify that's a capacity statement, not a revenue forecast — an analyst pushed on that directly during Q&A. But it tells you how confident they are that this isn't a short-term spike.

ALEX: Let's talk strategy for a second — the EPIC Center. Applied is opening a new R&D facility in Silicon Valley where they co-locate with customers and partners to speed up innovation. They've now got 11 announced partners, including a new one this quarter — Broadcom — plus SCREEN and UC Berkeley.

JORDAN: The logic is pretty simple: get designed into next-generation chip architectures earlier, and you capture more value and get better visibility into what customers actually need five, even ten years out. Gary Dickerson said some of these technology conversations go out a decade.

ALEX: Now, gross margins were a hot topic in the Q&A — multiple analysts pressed on this.

JORDAN: Yeah, a few different angles. One, why margins are guided roughly flat near-term despite all this growth — and the answer was ramp costs. They're hiring aggressively, over 1,500 people added this quarter alone in manufacturing and service support, and that creates a temporary headwind even as segment mix improves.

ALEX: And two, this value-based pricing strategy Brice talked about. Essentially, Applied re-prices tools based on the value they deliver rather than just cost-plus, and that's added about 300 basis points to company gross margins over the last three years.

JORDAN: Segment-level margins are already north of 55% in semiconductor systems, which is genuinely strong for an equipment maker. And services — Applied Global Services — had a great quarter too

This episode includes AI-generated content.

More earnings analysis: https://betafinch.com
Groups: CHIPS (https://betafinch.com/groups/CHIPS)
──────────
ALEX: Welcome to Beta Finch, your AI-powered earnings breakdown of the companies moving the market. I'm Alex.

JORDAN: And I'm Jordan. Today we're digging into Analog Devices' fiscal Q3 2026 results — and Alex, this one's got a headline number that's hard to miss.

ALEX: Before we get into it — quick reminder for everyone listening. This podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: Good. Now let's talk numbers. ADI just posted its first-ever $4 billion quarter — $4.02 billion in revenue, up 11% sequentially and 40% year over year. That's a big deal for a company this size.

ALEX: It really is. And it wasn't just one segment carrying the load — growth was broad-based. Industrial was up 53% year over year, automotive up 16%, communications up a massive 84%, and even consumer, which has been the laggard, grew 6%.

JORDAN: Communications is the one that jumps out to me. Data center now makes up 80% of that segment, and it grew over 100% year over year — both optical and power products doubled. That's the AI infrastructure story playing out in real numbers.

ALEX: Right, and it flowed straight to the bottom line. Gross margin hit 72.5%, operating margin was 50%, and EPS came in at a record $3.45 — up 68% from a year ago.

JORDAN: And the guidance for Q4 is even stronger. They're calling for $4.3 billion in revenue and gross margin jumping another 150 basis points to around 74% — levels we haven't seen since the 2022 peak. CFO Rich Puccio said that's coming from favorable mix, higher fixed-cost absorption, and — this caught my ear — price increases that haven't even fully kicked in yet.

ALEX: Let's talk strategy, because CEO Vincent Roche spent a lot of time on what he called the "grid-to-chip" story. Basically, ADI isn't just selling chips that go inside AI servers — they're positioning themselves across the entire power chain, from the electrical grid all the way down to the processor.

JORDAN: This is the part I found most compelling. Power, not compute, is now the bottleneck for AI. Roche made the point that going from 97% to 98% power conversion efficiency sounds trivial, but it cuts heat loss by roughly half — which matters enormously at data center scale. He even quantified it: their Empower acquisition, which lets them deliver power right into the processor package, can save about $30 million a year in a one-gigawatt data center.

ALEX: And on the optical side, they're riding the shift from 800-gigabit to 3.2-terabit networking speeds, with optical circuit switching revenue expected to roughly double this year — and double again in 2027.

JORDAN: The number that really stood out to me, though, was the SAM update — their addressable market for data center and energy by 2030 has more than doubled from what they projected just a year ago. That's not a small revision.

ALEX: Now, the Q&A had some great moments. Analysts kept pushing on one question: how much of this growth is secular versus just a cyclical upswing? Vivek Arya from Bank of America basically asked, "if I annualize your Q4 guide, that implies 20%-plus growth into fiscal 2027 — is that real?"

JORDAN: And Roche didn't shy away from it. He said he expects a "brisk growth year" in 2027, driven by the AI and defense super-cycles, Maxim acquisition synergies — which are on track to hit $1 billion-plus next year — and share gains across auto and consumer. He even said the analog industry, which historically grew mid-single digits, could sustain double-digit growth for years.

ALEX: There was a great historical callback too — an analyst from Evercore asked him to compare this to the late-'90s telecom buildout, which also had big secular promises that ulti

This episode includes AI-generated content.

More earnings analysis: https://betafinch.com
Groups: ENERGY (https://betafinch.com/groups/ENERGY)
──────────
ALEX: Welcome to Beta Finch, your AI-powered earnings breakdown for the companies moving the market. I'm Alex, joined as always by Jordan. Today we're diving into ExxonMobil's second quarter 2026 results — and this one's a doozy, because the backdrop was serious geopolitical disruption.

Before we get into it — this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: Yeah, so let's set the scene. This quarter played out against the Middle East conflict, which knocked out roughly 10% of Exxon's upstream production. That's a huge hit operationally.

ALEX: Right, but here's the headline — despite losing a tenth of their production, Exxon still posted $14.5 billion in earnings and $23.6 billion in cash flow from operations. That's industry-leading, disruption or not.

JORDAN: It really speaks to the diversification strategy. Outside the Middle East, upstream production actually hit its highest level in over two decades. And chemical margins jumped about 180% quarter-over-quarter because their North American plants stepped in to cover the supply shortfall.

ALEX: Let's talk Guyana, because this was the star of the Q&A. Production hit about 900,000 barrels a day gross, a fifth FPSO — that's a floating production vessel — set sail in June, and there's already talk of a ninth one being evaluated.

JORDAN: The really interesting nugget is what CFO Neil Hansen called an "inflection point." Exxon has now recovered its full $55 billion investment in Guyana almost two years ahead of schedule. Under the contract structure, once you hit that recovery cap, more of the revenue flows straight to free cash flow instead of being funneled back into cost recovery.

ALEX: So less volume growth going forward, but way more cash hitting the bottom line.

JORDAN: Exactly — management was clear multiple times: "this is about value, not volume." They're projecting free cash flow from Guyana to roughly double by 2030 compared to 2025.

ALEX: Now, refining — this is where it got really interesting given the Strait of Hormuz situation. CEO Darren Woods pointed out there's about 3 million barrels a day of refining capacity offline globally right now between the Strait closure, China halting exports, and Ukraine's strikes on Russian refineries.

JORDAN: And Exxon's positioned well for that because of a decade of portfolio high-grading — they shed weaker refineries and invested in the strong ones. Their Gulf Coast operations ran at over 95% reliability this quarter and delivered record second-quarter diesel production.

ALEX: One analyst pushed back a bit, though, noting refining earnings looked softer than some peers expected. Management chalked that up to volatility making margins hard to model in the moment, not any underlying operational issue.

JORDAN: Specialty products was actually a quiet standout — record quarterly and first-half earnings, best-ever basestock margins. Their integrated value chain let them pivot around the crude supply disruptions better than competitors.

ALEX: There was also a notable corporate move — Exxon officially redomiciled from New Jersey to Texas on July 1st, aligning their legal home with where they've actually operated for decades. Shareholders overwhelmingly approved it.

JORDAN: And don't sleep on the cost story. Structural cost savings are now at $16.3 billion cumulative since 2019, on track for $20 billion by 2030. They're basically holding cash costs flat year-over-year despite inflation and continued growth spending — that's the discipline that's funded all this shareholder return.

ALEX: Speaking of which — over $9 billion returned to shareholders this quarter through dividends and buybacks, plus more than

This episode includes AI-generated content.