As earnings season ramped up last week, investors were swarmed with headlines about many different companies. But with so many reports being released, investors may have easily overlooked some of the week's most interesting news.
In this week's recap, here three notable stories, including Snap's (NYSE:SNAP) and Alphabet's (NASDAQ:GOOGL) (NASDAQ:GOOG) impressive quarterly updates and Apple's (NASDAQ:AAPL) acquisition of most of Intel's (NASDAQ:INTC) modem business.
Snap crushes estimates
Shares of Snap soared after the social network reported its second-quarter results. Revenue for the quarter surged 48% year over year to $388 million, crushing analysts' consensus estimate for revenue of $360 million. Growth was fueled by the company's improving engagement as Snap continues to invest in improving its platform.
Importantly, daily active users increased 8% year over year to 203 million. In addition, the company said the audience watching content on the app's Discover feature, which includes content from friends, subscriptions, recommended shows, influencers, and sponsored stories, grew 35% year over year. Even more impressive, daily time spent by users watching Discover content increased 60% year over year.
Snap also said that there was a 10% increase in the retention rate of users who open Snapchat for the first time.
Alphabet's strong second quarter
Shares of Google parent Alphabet also soared when the online search giant reported its second-quarter results. Constant-currency revenue jumped 22% year over year -- an acceleration from 19% growth in Q1. Revenue in Q2 was $38.94 billion, easily beating analysts' average forecast for revenue of $38.15 billion.
While some of this growth was driven by a 16% increase in advertising revenue, Alphabet saw especially strong momentum in its "Google other" segment. The segment, which includes revenue from the company's cloud, app store, and hardware businesses, soared about 40% year over year.
Alphabet management was pleased with the company's cloud business performance. "Q2 was another strong quarter for Google Cloud," said Google CEO Sundar Pichai in the company's second-quarter earnings call, "which reached an annual revenue run rate of over $8 billion and continues to grow at a significant pace." Management also noted that cloud was a major driver of the company's Google other revenue growth.
Finally, there was the announcement that Apple agreed to acquire the majority of Intel's smartphone modem business. The acquisition will include about 2,200 Intel employees, intellectual property, equipment, and leases.
Valued at $1 billion, the deal will hardly put a dent in Apple's net cash of $113 billion as of the end of the company's fiscal second quarter. Despite its small price tag relative to Apple's massive pile of cash, investors shouldn't underestimate the potential impact of the acquisition. In a press release about the deal, Apple said it believes the acquisition will help the company "expedite our development on future products and allow Apple to further differentiate moving forward." Citing a person "familiar with the matter," Reuters noted this week that the deal could help Apple have a 5G modem ready for its products by 2021. This is years earlier than was previously thought the tech giant's 5G technology would be ready.
The acquisition is expected to close in the fourth quarter of 2019.