The Daily Earnings Reports Podcast

General Mills, Inc. (GIS) Q2 FY2025 Earnings Breakdown

Key Highlights

• Net Sales:
  • Q2 2025 Net sales increased 2% to $5,240.1 million, compared to $5,139.4 million in Q2 2024. Organic net sales increased 1%.
  • For the first six months, net sales essentially matched the same period last year, totaling $10,088.2 million.
  • Volume growth contributed positively, but this was partially offset by unfavorable net price realization and mix.
• Operating Profit:
  • Q2 2025 operating profit increased 33% to $1,077.9 million, compared to $811.8 million in Q2 2024. This was primarily due to a goodwill impairment charge in fiscal 2024, lower restructuring charges, lower input costs, and a favorable change in the mark-to-market valuation of certain commodity positions and grain inventories.
  • For the six-month period, operating profit increased 10% to $1,909.4 million.
• Earnings Per Share (EPS):
  • Diluted EPS increased 39% to $1.42 in Q2 2025 from $1.02 in Q2 2024.
  • For the first six months, diluted EPS increased 13% to $2.45.
• Adjusted Performance (Non-GAAP):
  • Adjusted operating profit for Q2 2025 was $1,064 million, a 7% increase on a constant currency basis. Adjusted diluted EPS was $1.40, a 12% increase on a constant-currency basis.
  • Adjusted operating profit for the first six months was $1,929 million, a 2% increase on a constant currency basis. Adjusted diluted EPS was $2.47, a 6% increase on a constant-currency basis. *These adjustments factor out items like restructuring, acquisition integration costs, and mark-to-market effects, and aim to provide a clearer picture of underlying business performance.
• Cash Flow: Net cash provided by operating activities was $1,774.7 million for the six-month period. The company noted an increase in cash and cash equivalents of $1,874.8 million over the six-month period, ending at $2,292.8 million.

Costco (COST) Q1 FY 2025 Earnings Breakdown

Key Highlights:

Financial Performance:

• Net sales increased 7.5% to $60.99 billion, compared to $56.72 billion in the same period last year.
• Net income for the quarter was $1.798 billion, or $4.04 per diluted share, compared to $1.589 billion, or $3.58 per diluted share, in the prior year. This includes a $100 million tax benefit related to stock-based compensation.
• Excluding the tax benefit, net income and diluted EPS growth were 9.9% and 9.8%, respectively.
• Gross margin improved by 24 basis points, driven by strong sales performance.

Sales and Comparable Sales:

• Comparable sales for the first quarter increased by 5.2%, with adjusted comparable sales (excluding gasoline prices and foreign exchange impacts) rising by 7.1%.
• U.S. comparable sales were particularly strong at 7.2% (adjusted).
• E-commerce comparable sales surged by 13.0% (13.2% adjusted).

Membership:

• Membership fee revenue increased by 7.8%.
• The worldwide membership renewal rate remained high at 90.4%, with a 92.8% renewal rate in the U.S. and Canada.
• Total paid memberships grew by 7.6% to 77.4 million, while total cardholders increased by 7.2% to 138.8 million.

Warehouse Expansion:

• Costco opened two new warehouses during the quarter, one in Zaragoza, Spain and the other in Napa, California.
• The company has plans to open six additional warehouses in the remainder of FY 2025.

Digital Metrics:

• E-commerce site traffic increased by 16%.
• Average order value for online purchases grew by 4%.
• Costco Logistics deliveries saw a 13% increase, with items delivered rising by 19%.

Broadcom Inc. (AVGO) Q4 FY 2024 Earnings Breakdown

Key Highlights:

• Record Revenue Growth: Broadcom achieved record revenue of $51.6 billion for FY 2024, marking a 44% year-over-year increase. This growth was driven by both the semiconductor solutions and infrastructure software segments.

“Broadcom’s fiscal year 2024 revenue grew 44% year-over-year to a record $51.6 billion, as infrastructure software revenue grew to $21.5 billion, on the successful integration of VMware." - Hock Tan, President and CEO of Broadcom Inc.

• Strong AI Performance: AI revenue soared to $12.2 billion in FY 2024, representing a remarkable 220% year-over-year growth. This success was attributed to Broadcom's leading AI XPUs and Ethernet networking portfolio.

"Semiconductor revenue was a record $30.1 billion driven by AI revenue of $12.2 billion. AI revenue which grew 220 percent year-on-year was driven by our leading AI XPUs and Ethernet networking portfolio.” - Hock Tan, President and CEO of Broadcom Inc.

• Increased Dividend: Based on strong cash flow performance, the Board of Directors declared a quarterly dividend of $0.59 per share, marking an 11% increase from the previous quarter. This represents the fourteenth consecutive annual dividend increase since 2011.

"Based on increased cash flows in fiscal year 2024, we are increasing our quarterly common stock dividend by 11% to $0.59 per share for fiscal year 2025. The target fiscal year 2025 annual common stock dividend of $2.36 per share is a record, and the fourteenth consecutive increase in annual dividends since we initiated dividends in fiscal 2011.” - Kirsten Spears, CFO of Broadcom Inc.

• VMware Integration Success: The successful integration of VMware contributed significantly to the growth of infrastructure software revenue, reaching $21.5 billion in FY 2024.
• Strong Q4 2024 Performance: Q4 2024 revenue reached $14.054 billion, a 51% increase from the prior year period. Adjusted EBITDA for Q4 2024 was $9.089 billion, representing 65% of revenue.

Planet Labs (PL) Q3 2024 Earnings Breakdown

Key Highlights:

• Revenue Growth: Revenue increased by 11% year-over-year, reaching $61.3 million for Q3 2024. This growth was driven primarily by new customer acquisition in the Civil Government and Defense & Intelligence verticals.
• "Revenue increased $5.9 million, or 11%, to $61.3 million for the three months ended October 31, 2024 from $55.4 million for the three months ended October 31, 2023."
• Customer Base Expansion: Planet Labs reported an End of Period (EoP) Customer Count of 1,015, representing a 4% increase compared to the same period last year. This demonstrates continued market adoption of their platform.
• Strong Recurring Revenue: 97% of their ACV Book of Business consists of recurring revenue from annual or multi-year contracts. This indicates a stable and predictable revenue stream.
• Focus on Agile Space Systems: Planet Labs utilizes a strategy of deploying numerous low-cost satellites rather than investing in a few expensive ones. This approach has resulted in lower capital expenditures compared to competitors.
• Investing in New Verticals: The company is actively expanding its offerings to cater to emerging markets like energy, finance, insurance, and consumer packaged goods. They are also leveraging AI to make their data more accessible and actionable.
• Related Party Transactions with Google: Google, holding over 10% of Planet Labs' Class A common stock, is both a customer and a service provider. Planet Labs licenses content to Google and utilizes Google Cloud Platform for hosting and other services.
• Legal Proceedings: A stockholder class action lawsuit has been filed against former officers and directors of dMY IV (Planet Labs' SPAC predecessor) and the company itself, alleging breaches of fiduciary duties.

Oracle (ORCL) Q2 FY2025 Earnings Breakdown

Key Highlights:

• Cloud and License Business Continues to Drive Growth: The cloud and license business remained the primary revenue driver, representing 85% of total revenues on a trailing 4-quarter basis.
• Growth in cloud services revenues was particularly strong, driven by both new customer acquisitions and renewals.
• "Excluding the unfavorable effects of foreign currency rate fluctuations ... the increase in our cloud and license business revenues was primarily due to growth in our cloud services revenues as customers purchased our applications and infrastructure technologies and also renewed their related cloud contracts to continue to gain access to the latest versions of our technologies."
• Hardware Business Decline: The hardware business faced challenges, with revenues declining by 4% in reported currency and 3% in constant currency.
• This decline is attributed to the company's focus on cloud-based infrastructure technologies.
• Services Business Decline: Similar to the hardware business, the services business also saw a decline in revenues, decreasing by 3% in both reported and constant currency.
• This decline was attributed to decreases across all primary service offerings.
• Investment in Ampere: Oracle continues its investment in Ampere Computing Holdings LLC, with a total carrying value of $1.5 billion as of November 30, 2024.
• While Ampere is currently generating net losses, Oracle remains confident in its long-term potential.
• Significant R&D Investments: Oracle continues to invest heavily in research and development, deeming it essential for maintaining its competitive position.

Macy's (M) Q3 2024 Earnings Breakdown

Key Highlights:

• Despite the internal control weakness, Macy's delivered positive results in certain areas of its business, demonstrating the effectiveness of its "Bold New Chapter" strategy.
• The identified material weakness raises concerns about the design and effectiveness of Macy's internal control environment. The company's remediation plan is crucial to restoring confidence in its financial reporting.
• Investors should closely monitor the progress of the remediation plan and its impact on future financial performance.

AutoZone (AZO) Q1 FY2025 Earnings Breakdown

Key Highlights:

• Net Sales: $4.3 billion, a 2.1% increase year-over-year.
• Same Store Sales: Domestic: 0.3%, International: 1.0% (13.7% excluding currency fluctuations).
• Gross Profit Margin: 53.0%, a 16 basis point increase year-over-year.
• Operating Profit: $841.1 million, a 0.9% decrease year-over-year.
• Diluted EPS: $32.52, compared to $32.55 in the prior year.
• New Store Openings: 34 new stores opened during the quarter (23 U.S., 6 Mexico, 5 Brazil).
• Total Store Count: 7,387 as of November 23, 2024.
• Inventory: Increased 8.7% year-over-year, with net inventory per store at negative $166 thousand.
• Share Repurchases: 160 thousand shares repurchased for a total of $505.2 million.

GameStop (GME) Q1 FY2025 Earnings Breakdown

Key Highlights:

• Net Sales Decline: GameStop experienced a significant decrease in net sales, down 20.2% for the quarter and 27.0% for the nine months ended November 2, 2024, compared to the prior year periods. This decline was observed across all product categories and geographic segments.
• Shift to Higher Margin Products: Despite the sales decline, gross profit as a percentage of net sales increased, driven by a strategic shift towards higher-margin products like collectibles and pre-owned hardware and accessories.
• Increased Interest Income: The Company recognized substantial net interest income, largely attributed to higher returns on invested cash and cash equivalents resulting from the At-the-Market ("ATM") equity offering.
• International Asset Optimization: GameStop continued its efforts to optimize international operations, including exiting operations in Ireland, Switzerland, and Austria during fiscal 2023, initiating a wind-down of operations in Germany, and selling its Italian subsidiary.
• Significant Cash Position: The Company maintains a substantial cash position, primarily driven by proceeds from the ATM offering. This cash is intended for general corporate purposes, including potential acquisitions and investments.
• New Investment Policy: A new investment policy was approved, granting authority to an Investment Committee, which includes CEO Ryan Cohen, to manage the Company's portfolio in public and private markets.