Stocks reacted sharply in pre-market trading after a wave of earnings reports delivered a mix of beats, misses and updated guidance across sectors ranging from consumer staples to semiconductors and cloud software. Several companies gained on stronger-than-expected results, while others fell as investors focused on revenue, margins and forward-looking outlooks.
Key takeaways
- McDonald’s shares rose after adjusted earnings came in above estimates, even as revenue slightly lagged expectations.
- Merck climbed after an adjusted earnings shortfall and a revenue miss were offset by an increase in full-year revenue guidance.
- Palantir Technologies surged on results driven by a sharp increase in U.S. commercial revenue.
- Caterpillar gained after second-quarter figures exceeded analyst expectations on both profit and revenue.
- DigitalOcean dropped despite an earnings and revenue beat, pointing to how investors weighed results against other factors.
What drove the move
For consumer and healthcare companies, investors parsed the gap between quarterly profit versus revenue and the strength of guidance. McDonald’s shares advanced after the company reported adjusted earnings of $3.38 per share compared with an LSEG consensus of $3.32. Revenue of $7.1 billion, however, came in below the $7.13 billion expected by analysts polled by LSEG.
Merck’s stock also rose after the company reported an adjusted loss of 13 cents per share on revenue of $16.61 billion, according to the earnings report. Analysts polled by LSEG had expected a loss of 27 cents per share on revenue of $16.36 billion. Beyond the quarter, the pharmaceutical company boosted its full-year revenue guidance, which helped offset the weakness reflected in the adjusted earnings outcome.
In pharma, Pfizer shares moved higher after second-quarter results beat Wall Street estimates. The company earned an adjusted 77 cents per share on revenue of $15.03 billion, versus LSEG expectations for profit of 68 cents per share on revenue of $14.41 billion. Pfizer also increased the low end of its full-year revenue outlook, giving investors an additional signal on forward performance.
Tech and industrial results drove some of the most pronounced reactions. Palantir Technologies jumped 15% after posting a “blowout” second quarter, with results supported by nearly a 150% surge in U.S. commercial revenue. Caterpillar gained 8% after delivering an adjusted $8.17 per share on revenue of $20.54 billion, topping LSEG’s expectations for profit of $6.20 per share on revenue of $19.34 billion.
Market reaction across earnings winners and losers
Semiconductors and social media saw strong positive momentum where investors found operational improvement or clear metric outperformance. On Semiconductor shares rose more than 7% after its second-quarter results topped expectations. The company reported adjusted earnings of 74 cents per share on revenue of $1.6 billion; LSEG had forecast profit of 71 cents per share on revenue of $1.59 billion. The report also cited better-than-expected margins, a key factor investors often use to assess the durability of earnings power.
Snap gained about 5% after it released second-quarter results. The company reported a loss of 10 cents per share, with it not specified whether that number was directly comparable to an LSEG consensus. Revenue of $1.6 billion beat the $1.54 billion estimate tracked by LSEG. The company’s user and monetization metrics also exceeded expectations, with global daily active users and average revenue per user both coming in above forecasts.
Not all beats translated into gains. Whirlpool shares were little changed after posting a second-quarter loss that was larger than analysts anticipated and lowering its full-year earnings guidance. The company reported an adjusted loss of 21 cents per share compared with the 5-cent loss expected by analysts polled by LSEG, alongside revenue of $3.52 billion below expectations.
Wayfair fell 4% even after posting results that beat estimates. Wayfair reported adjusted earnings of 95 cents per share, excluding items, on revenues of $3.52 billion, versus LSEG expectations for 89 cents per share on revenue of $3.47 billion. The move suggests investors may have been focused on the trajectory of margins, broader demand assumptions, or forward outlook elements not fully captured by the headline beat.
DigitalOcean dropped 11% despite recording an earnings and revenue beat. The cloud computing company reported 45 cents per share on revenue of $281 million, according to LSEG, beating expectations of 26 cents per share on revenue of $279 million. The selloff underscores that investors can react negatively when factors such as guidance, profitability trends, or other details do not align with expectations—even if quarterly numbers clear estimates.
What to watch next
As the market digests this earnings mix, investors are likely to concentrate on guidance updates and the quality of growth, including margin performance and commercial revenue trends. With multiple companies raising or updating outlooks—most notably Merck and Pfizer—traders will also watch for additional commentary on full-year demand and cost discipline. The next catalysts will come from upcoming earnings releases across remaining sectors and the broader macro backdrop for interest rates and inflation expectations, which continue to shape valuation sensitivity for both industrial and growth-oriented stocks.
