As earnings season gains momentum, a handful of technology stocks are scheduled to report over the next few days. Notably, after market close today, the market will get results from Facebook (META 1.54%), Microsoft (MSFT 1.78%) and PayPal (PYPL 2.22%).
Here's an overview of what to expect from each of these companies, including a preview of Facebook's active user growth, PayPal's active customer account growth, and one of Microsoft's most important catalysts.
As usual, analysts have breakneck growth expectations for Facebook. On average, they expect the social network's fourth-quarter revenue of $12.55 billion and earnings of $1.95 per share. Those results would represent year-over-year revenue and EPS growth of 42.5% and 38%, respectively.
Importantly, that forecast looks quite realistic when viewed next to the social network's most recent quarter, when year-over-year revenue and non-GAAP EPS growth were 47% and 77%, respectively.
Beyond revenue and EPS, one key metric to watch when Facebook reports its results will be its user growth. To maintain the 3% sequential growth in monthly and daily active users it posted in its third quarter, it will need to report about 2.13 billion monthly active users and 1.41 billion daily active users.
For the second quarter of its fiscal 2018, the analysts' consensus is that the software giant's revenue and non-GAAP EPS will come in at $28.4 billion and $0.87, respectively. These figures compare to $26.1 billion and $0.83 in the year-ago quarter, and if accurate, would represent 8.9% and 4.8% year-over-year growth, respectively.
For some context, in Microsoft's fiscal Q1 2018, its revenue and earnings per share rose 12% and 17%, respectively.
One key area to watch for the software and cloud company will be the revenue growth of its commercial cloud computing platform, Azure. Sales in the important segment jumped 90% year over year in Q1, and given that it has been one of Microsoft's fastest-growing cloud products, investors will want to know just how strong that growth is now.
On average, analysts expect financial-technology company PayPal to report revenues of $3.63 billion and non-GAAP EPS of $0.52, representing 21.9% and 23.8% year-over-year growth, respectively. If top-line growth hits those figures, it would reflect a notable acceleration compared to PayPal's strong third-quarter revenue growth of 21.4%.
Analysts' consensus estimates for PayPal's Q4 revenue and non-GAAP earnings per share fall toward the high end of management's guidance ranges provided in its third-quarter earnings release. The company forecast revenue in the ranges of $3.57 billion to $3.63 billion, and EPS of $0.50 to $0.52. But management updated its outlook in mid-November to reflect the impacts of a sale of a U.S. consumer credit portfolio. In the November update, management said it expected GAAP and non-GAAP revenue in the ranges of $3.64 to $3.7 billion and $3.595 billion and $3.655 billion, respectively. Its guidance for non-GAAP EPS was unchanged.
Investors should keep an eye on PayPal's growth in active customer accounts -- i.e., registered accounts that have sent or received at least one payment or payment reversal during the past 12 months. In Q3, PayPal's active accounts surged higher, with net additions of 8.2 million -- up meaningfully from the 6.5 million active customers PayPal added in its Q2.
Investors will find these companies' earnings releases for their most recently ended quarters in the investor relations sections of their websites, shortly after market close on Wednesday.
Editor's note: an earlier version of the article didn't include PayPal's updated guidance for its fourth quarter. The article has been updated.