Earnings vs. Reality
AVGO, CRWD, LULU
Hey!
Welcome to another edition of Earnings vs. Reality. This week, we're diving into the latest reports from a trio of fascinating Nasdaq-100 companies: the AI powerhouse AVGO 0.00%↑ (Broadcom), the cybersecurity leader CRWD 0.00%↑ (CrowdStrike), and the premium apparel giant LULU 0.00%↑ (Lululemon).
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What are earnings calls, anyway?
In a nutshell, it’s when companies share how they performed financially in the last quarter and provide clues about future prospects. Management fields questions from analysts and reveals the good, the bad, and sometimes the downright perplexing. For us, these calls offer a treasure trove of data to guide our investing decisions.
Let's get into it.
Broadcom ($AVGO)
Broadcom came out swinging, reporting a truly massive, record-breaking quarter. The numbers were impressive across the board, with revenue hitting $15 billion. They made it clear that their growth is coming from two main places: booming demand for their AI chips and the successful, high-profit integration of their big VMware acquisition. They also guided for an even stronger next quarter, signaling that the good times are set to continue.
CrowdStrike ($CRWD)
CrowdStrike also delivered a strong quarter, beating analyst expectations. Management spent the call highlighting the success of their new "FalconFlex" subscription model, which they say is getting customers to spend more, faster. They painted a picture of a company dominating its market, stealing customers from competitors, and leading the way into the next generation of AI-powered security. Their outlook was very confident, predicting that growth will actually pick up in the second half of the year.
Lululemon ($LULU)
Lululemon's report was a mixed bag. They technically beat expectations for the first quarter, driven by very strong sales in their international markets, especially China. However, the big story was the slowdown in their most important market: the United States. Even worse was their forecast for the future. They slashed their profitability outlook for the rest of the year, blaming a hesitant US consumer and new tariffs. This sent a shockwave through the investment community.