Major benchmarks were mixed on Wednesday after the U.S. Department of Justice unveiled a broad antitrust review of the business practices of unnamed "leading online platforms" in the internet search, social media, and retail services segments. The Dow Jones Industrial Average (DJINDICES:^DJI) lost about 0.3%, while the S&P 500 (SNPINDEX:^GSPC) notched a record high.
Today's stock market
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Caterpillar's growth slows to a crawl
Shares of Caterpillar fell 4.5% after the heavy equipment manufacturer announced weaker-than-expected second-quarter 2019 results and tempered its full-year earnings guidance.
Quarterly revenue climbed 3% year over year to $14.43 billion, translating into a 5.1% decline in profit to $1.62 billion. Thanks to stock repurchases over the past year, however, Caterpillar's per-share profit increased by $0.01 to $2.83. Analysts, on average, were expecting earnings of $3.12 per share on slightly higher revenue.
In part, the company blamed its shortfall on a combination of unfavorable product mix within the energy and transportation and construction industries, as well as higher material costs including the impact of tariffs.
Looking to the full year, Caterpillar also told investors it now expects its per-share profit to be at the lower end of its previous guidance range of $12.06 to $13.06.
Texas Instruments' quarter adds up to an earnings beat
Meanwhile, Texas Instruments stock jumped 7.4% after the semiconductor company released stronger-than-expected quarterly results -- though that's not to say TI's performance looked good at first glance. Second-quarter revenue dropped 8.7% year over year to $3.668 billion, including a 6% decline from its analog segment and a 16% drop in embedded processing product sales. On the bottom line, that translated into a 7% decrease in net income to $1.305 billion and -- again thanks to repurchases -- a more modest 3% decline in per-share earnings to $1.36.
Most analysts were only expecting earnings of $1.22 per share on revenue of $3.6 billion.
In keeping with Texas Instruments' goal of dedicating all free cash flow to capital returns, Chairman and CEO Rich Templeton noted the company has returned a whopping $8 billion to shareholders over the past year through stock repurchases and dividends.
For the third quarter, Texas Instruments sees revenue ranging from $3.65 billion to $3.95 billion -- down from $4.26 billion a year earlier -- with earnings per share between $1.31 and $1.53. Relative to the midpoints of those ranges, consensus estimates predicted slightly lower per-share earnings of $1.38 on somewhat higher revenue of $3.83 billion.
Given the company's relative outperformance to end the first half, however, it's hardly surprising that Texas Instruments shares rallied today.