We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
Oil - US Crude
Mixed
Bitcoin
Bearish
More View more
Real Time News
  • Australian Dollar May Fall vs Yen as RBA Bets, Charts Line Up - https://www.dailyfx.com/forex/analyst_picks/todays_picks/ilya_spivak/2020/01/22/Australian-Dollar-May-Fall-vs-Yen-as-RBA-Bets-Charts-Line-Up.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Spivak&utm_campaign=twr #AUDJPY #trading https://t.co/Q5o5LwRXeS
  • US President Trump says if they cannot make a deal with the EU then they will put 25% tariffs on EU autos $EUR
  • UK Chancellor Javid says they plan to carry out digital service tax in April Keep in mind, the Trump Administration has threatened the UK with tariffs if this were to go ahead $GBP
  • US President Trump states that tax cut plan will be coming in 90-days
  • UK Chancellor Javid states that a trade deal with the EU can be done before the end of the year $GBP
  • BoC rate decision - Near enough fully priced in for rates on hold today - $USDCAD ATM break-evens at 50pips - Money markets 60% priced in for rate cut by year-end $CAD TD Securities (Trading the BoC) https://t.co/AUSaV8rLwU
  • US Treasury Secretary Mnuchin says trade agreement with the UK is the priority for 2020 - CNBC
  • 🇬🇧 GBP Public Finances (PSNCR) (Pounds) (DEC), Actual: 16.6b Expected: N/A Previous: 9.9b https://www.dailyfx.com/economic-calendar#2020-01-22
  • 🇬🇧 GBP Central Government NCR (DEC), Actual: 15.6b Expected: N/A Previous: 9.6b https://www.dailyfx.com/economic-calendar#2020-01-22
  • US Treasury Secretary Steve Mnuchin says Phase 2 trade deal can be done before or after the US election, adds that there is no deadline for the Phase 2 deal
US Dollar Impacted Firms’ Earnings amid Varying Growth in Sales

US Dollar Impacted Firms’ Earnings amid Varying Growth in Sales

2015-10-22 23:54:00
Ryan Cox,
Share:

Talking Points:

  • The impact of a stronger dollar reduced 3M’s 3Q sales by 7.4 percent year-on-year
  • Amazon.com saw a 3Q revenue increase of 23 percent year-on-year even with a $1.3 billion exchange rate impact
  • Microsoft and Alphabet (Google’s new parent entity) posted better than expected results despite currency headwinds

The Third Quarter earnings season continued with a pocket of high profile, major corporations posting their results Thursday. The balance of the day was particular strength in the technology sector, but there was perhaps a more uniform factor across these figures: a heavy impact on international profits due to the high level of the US Dollar.

One of the more disappointing outcomes, industrial-product maker 3M Co. reported its third-quarter sales declined 5.2 percent year-on-year. The fortune 500 company, with $31.8 billion in sales last year, derives approximately two-thirds of its revenue from outside of the US. In the company’s earnings report it stated that foreign currency translation reduced sales by 7.4 percent year-on-year. 3M Co. became just another of an increasing number of multinational firms that saw third-quarter revenues impacted by a stronger dollar.

Microsoft posted a third-quarter profit of $5.6 billion, or $0.67 per share. The company beat analyst’s estimates of $0.587 per share which is an increase of 3 percent from the same quarter last year. Microsoft did beat estimates for revenue by 3.2 percent; however, year-on-year growth for Microsoft declined 6.6 percent. The company’s earnings report showed that the constant currency impact on revenue was $1.15 billion.

Google, under its newly minted parent entity Alphabet Inc. reported earnings after the close. The company posted a third-quarter profit of $3.98 billion, or $7.35 per share. Alphabet Inc. performed well compared to one year ago with net income up 15.7 percent and revenue up 14.7 percent to $18.68 billion. In the earnings conference call Alphabet Inc.’s CFO Ruth Porat stated that currency headwinds from a strong dollar amounted to a $1.6 billion negative impact on revenues. Its share price jumped to a record high in afterhours trading.

Amazon.com posted a third-quarter profit of $79 million, or $0.17 per share. It topped analysts’ estimates that projected a net loss of -$0.13 per share. The company not only beat analyst’s estimates for the bottom line numbers but also reported third-quarter revenue at $25.3 million, up 23 percent from the same period a year ago. With a strong performance from the online retailer foreign exchange rates throughout the quarter had an unfavorable impact of $1.3 billion on net sales.

Amazon.com is in the consumer discretionary sector, the best performing US sector over the last ten years. Within this sector Amazon.com is defined as being an internet and catalog retailer. This industry saw extraordinary growth over the past five years - only second behind biotechnology. The performance in revenue growth for consumer discretionary firms like Amazon.com may reflect consumers’ willingness to spend. Since consumer spending makes up close to 70 percent of US GDP it may also reflect on the health of the US economy.

Don’t know where to start in forex trading? Check out our courses here.

US Dollar Impacted Firms’ Earnings amid Varying Growth in SalesUS Dollar Impacted Firms’ Earnings amid Varying Growth in Sales

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.