Good morning investors!

During the ever important earnings season, we publish our “Earnings Recap” — an in-depth summary of the earnings reports for stocks that we cover on a regular basis.

This earnings season officially kicked off this week and we are here to keep you well informed on all of the names we cover.

Let’s dive in.

Taiwan Semiconductor (TSM)

Taiwan Semiconductor $TSM ( ▼ 1.59% ) topped expectations as AI-driven chip demand fueled record quarterly profit. The stock is +6.8% so far this week.

🔑 Key Points

  • EPS: $2.92 vs $2.63 est.

  • Revenue: $33.10B vs $32.07B est.

  • AI demand: HPC and AI chips drove 57% of revenue, offsetting smartphone softness.

  • Advanced nodes: 74% of sales came from 7nm and below, led by strong 3nm ramp.

  • Capex strain: Free cash flow fell 25% YoY on heavy equipment and packaging investment.

  • Margins firm: Gross margin 59.5%, operating margin 50.6%, both improved YoY.

  • Guidance: Q4 sales $32.2B-$33.4B, FY growth raised to mid-30% on strong AI demand.

🔐 Edge Takeaway: TSMC’s quarter showed AI remains the driving force behind its growth. HPC and advanced nodes lifted margins back near 59.5%, and management raised full-year revenue growth to the mid-30%, up from ~30%. Capex stays heavy at $40B-$42B for 2025, but it is pointed at AI capacity and advanced packaging that customers are demanding. Looking further ahead, the…upgrade to Edge+ to read the Full Edge Takeaway.

JPMorgan Chase (JPM)

JPMorgan $JPM ( ▼ 0.33% ) topped expectations as strong trading, consumer lending, and wealth inflows powered record quarterly revenue. The stock is -0.8% so far this week.

  • EPS: $5.07 vs $4.85 est.

  • Revenue: $47.12 B vs $45.47 B est.

  • Markets strength: Fixed income +21% and equities +33% drove record $8.9B trading revenue.

  • Consumer momentum: Card and deposit growth lifted Consumer Banking revenue +9% YoY to $19.5 B.

  • Wealth inflows: AUM +18% YoY to $4.6T on $109B net inflows and higher markets.

  • Credit costs: Provision for credit losses +9% YoY to $3.4 B with $810M reserve build as credit normalizes.

  • Guidance: Sees FY NII ~$95.8 B, expenses ~$95.9 B, and Card NCO rate ~3.3%.

🔐 Edge Takeaway: JPMorgan’s Q3 proved why it continues to set the benchmark for U.S. bank performance. Revenue climbed 9% and profit rose 12%, showing…upgrade to Edge+ to read the Full Edge Takeaway.

Johnson & Johnson (JNJ)

Johnson & Johnson $JNJ ( ▲ 0.57% ) beat estimates as strong MedTech and pharma sales lifted results. The stock is +0.7% this week after the beat and planned orthopedics spin-out.

🔑 Key Points

  • EPS: $2.80 vs $2.76 est

  • Revenue: $23.99B vs $23.76B est

  • Pharma growth: Oncology and Immunology offset Stelara declines, Darzalex +22%, Tremfya +41%.

  • MedTech strength: Cardiovascular, Abiomed, and Vision units powered +7% segment growth.

  • Efficiency gains: R&D down 26% YoY, boosting operating income +125%.

  • Margins firm: Gross margin 69.6%, operating margin doubled to 31%.

  • Guidance: FY25 sales raised to $93.7B midpoint, EPS outlook reaffirmed at $10.80-$10.90.

🔐 Edge Takeaway: Johnson & Johnson’s quarter checked every box that matters. The company beat expectations and doubled down on…upgrade to Edge+ to read the Full Edge Takeaway.

Bank of America (BAC)

Bank of America $BAC ( ▲ 1.67% ) topped expectations as record net interest income, investment banking strength, and solid credit quality drove double-digit profit growth. The stock is +3.7% this week.

  • EPS: $1.06 vs $0.95 est.

  • Revenue: $28.09B vs $27.52B est.

  • Net interest income: Hit a record $15.2B, up 9% YoY from higher loan and deposit balances.

  • Investment banking: Fees jumped 43% YoY to $2.0B on resurgent M&A and debt underwriting.

  • Trading revenue: Sales and trading climbed 9%, with equities +14% and FICC +5%.

  • Expense control: Noninterest expense rose just 5% YoY, improving efficiency ratio to 62%.

  • Capital returns: Returned $7.4B to shareholders, including an 8% dividend increase and $5.3B buyback.

🔐 Edge Takeaway: The quarter confirmed that Bank of America is finally getting leverage out of its balance sheet again, with…upgrade to Edge+ to read the Full Edge Takeaway.

Abbott Labs (ABT)

Abbott Laboratories $ABT ( ▲ 0.71% ) posted mixed Q3 results as Medical Devices strength offset weakness in Diagnostics and Nutrition. The stock is -3.7% this week.

  • EPS: $1.30 vs $1.30

  • Revenue: $11.37B vs $11.39B

  • Medical Devices: Up 15% YoY to $5.45B on strong Diabetes, EP, and Structural Heart momentum.

  • Diagnostics: Down 7% YoY to $2.25B as COVID test sales fell sharply to $69M.

  • Nutrition: Up 4% YoY to $2.15B, led by Ensure and Glucerna in Adult Nutrition.

  • Margins: Adjusted op. margin rose 40 bps to 23.0% from cost control and mix.

  • Guidance: FY25 EPS $5.12–$5.18, organic sales growth 7.5–8.0% reaffirmed.

🔐 Edge Takeaway: Abbott’s Q3 showed the device business carrying the quarter as diagnostics…upgrade to Edge+ to read the Full Edge Takeaway.

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Thank you, and until next time investors!

Mark & Chris

The Investor’s Edge

Disclosure

This is not investing advice. It is very important that you do your own research and make investments based on your own personal circumstances, preferences, goals and risk tolerance.

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