We had AMD Google and Microsoft report earnings today, but it was Google Alphabet, the mother company that, um, pretty much aggressively sold off after the market opened and in this video, we're going to be breaking it all down. and why Google sold off even when it be expectation. This is a question that a lot of beginners often have and I really hope that it at least at least shed some light on the questions you might have. So I hope that you learned something new, and if you do, please consider dropping a thumbs up and subscribing if you feel like we earned it.

And let's go ahead and jump right into it. So again, AMD Microsoft and Alphabet also known as Google reported earnings today and as you guys could see, I did short Google on the second win that it had to lows of 140 I made $4,400 shorting Google again I trade with half a million dollars. Please make sure that you're aware of that. But the really beautiful thing about this is that I've often said it before.

why predict when you can wait to react instead of buying Google Google and then just fingers crossed hoping for something to happen I waited for direction to be clear I saw that it was getting rejected by that moving average and I took a short position on the way down making money as it sold off. Then when it began to indicate signs of a support, I bought to cover, closed that position and walked away with $4,400 in the green. Now the question that I have is did Google pull back enough that I potentially want to buy it longterm? Well, let me share with you some of my thoughts and you let me know down in the comments section what you think So first off, what did it report Microsoft also reported ear today earnings per share at 293 versus the expectation of 278 Revenue came in at 62 billion, expectation at 61.1 Yet when Microsoft reported earnings, it also sold off Like let's not sugarcoat it like it actually sold off. but then it had its guidance call.

If you watched today's earlier video I make it very clear there's the earnings report that is released right after the market closes and then about an hour to maybe 2 hours after there is a guidance call. it's called its earnings call and this is where the executives talk about up and cominging quarters. I've said it before. Earnings calls are often more important for the overall individual stocks reaction if it's going to continue to sell off, or if it's going to recover and you can see for Microsoft's sake it recovered, but definitely not for Google.

One of the things that we saw with Google is Alphabet also beat expectations for earnings per share at 162 Uh, 164 versus 159. Expect ation and revenue came in at 86.3 billion versus the expectation of 85.2 Three, Now the reason that we saw that micro I'm sorry. the reason that we saw Alphabet sell off is because although it be expectation for overall Revenue add Revenue there. I mean there's individual kind of like Focus points for each company and how it produces revenue and within those Focus points one of the main things for Google is is AD revenue.

and guess what? ad Revenue did come in a little bit lower than what was expected and it came in at 65.5 billion versus the expectation of 65.8 billion. But you can see that in almost everything else it be based off of cloud. Revenue it' be based off of earnings per share. It' be based off of overall Revenue 72.3 2 billion.

but guess what? it did not. Beat It by Ad Revenue and AD revenue is where Google makes most of its actual money. But if you really think about it, I'm not saying that it's not a lot of money but 65.5 versus 65.8 and yet you're going to sell off when it be everything else. This is how delicate earnings can sometimes be.

Remember I've told you when markets become very overbought, very overextended. expectations become very high high. So if they based off of what they report, if they don't meet those same expectations, there's this reaction. Remember and I've said it so many times before: I'm not trying to instill fear in you.

it's because I've experienced this that you cannot be surprised that when markets are extremely overbought, when individual stocks are extremely overbought, that they correct themselves. because in reality they all eventually do. They might have a long Bull Run great. But if you're not locking in profits, reducing position size, that overbought levels in preparation for a potential pullback, then think about it.

For all those that bought up here, that that was a great buy. now they're down on their position. Now for those like us that have stayed cash, or that either liquidated, some shares at these overbought levels can load up at oversold levels or wherever it is that, it makes sense for us because now we're able to take advantage of these lower prices. Remember these very valuable companies.

These trillion dollar companies I don't freak out when they begin to sell off I Get excited because I get to buy them at a discounted rate and is that not what we're looking forward to for deals, right? I wanted to share with you What? Um, some of the people from Yahoo finance said and I'm I'm just going to break it down and kind of like make it more simple to understand so hear them out. We got alphabet earnings as well. Another big name. those Shares are down in the after hours.

Remember nice run into this print Julie The stock was up about 10% this year, more than 50% last 12 months. Initial reaction: We're down here EPS 164 that's a Beat The Street was close to 159 on Revenue 8631 billion. Also, a Beat Street was at uh closer to 85.3 6 billion. cloud is interesting because remember that disappointed last time reported but this time 9.19 billion.

That's also a beat. But some interesting questions here: I There's obviously the move here in part was this kind of General um more positive optimistic Outlook about the general kind of advertising environment in 2024 I think You' be looking for more questions about the cloud business as well and what they see ahead. Did you say the ad Revenue number already I did not. Okay, so ad Revenue here at$ 65.5 billion 65.8 is what anals were looking for.

And to your point, there was a lot of attention on that and from what I was seeing from a lot of the preview, a lot of optimism around ad spending. So the fact that that number missed and obviously that number is a big number for uh for the company that's the biggest source um of its Revenue So that uh is something that I think people are are paying attention to here that Miss in the ad Revenue perhaps one of the things responsible for that quick drop that we were seeing in the shares. yeah and AI is a very dist. I mean listen that I'll be in focused again.

It's a bit different than Microsoft in that when you talk about Ai and we're about to, you know, going to speak to some Smart Financial analysts The question is kind of like, all right, what's the contribution like right with Google I Think it's a way more sort of interesting conversation about as AI develops. how much does that kind of upend and redefine traditional search and what that kind of means for Google most definitely. And and what's that going to do to their advertising? Revenue As a result of that, So Pai Um, his statement here in the earnings release He says we're pleased with the ongoing strength and search and the growing contribution from YouTube and Cloud Each of these kind of to your point is already benefiting from our AI, Investments and Innovation As we enter the Gemini era. he says the best is at to come Gemini their generative AI offering.

Although he only said AI once, it just wait for the conference call. just said it three times. So I don't I don't think we can read anything into that, but it is. Um, obviously AI is going to be a very large part of the discussion.

Um, you know. initial first bless as we look at the drop. Here There were so much hope and sometimes these companies do come out and surpass those expectations. but at least at First Blush year, it doesn't look like that alphabet has in particular with that 4% drop.

Yeah, we see. Also, you know, be interesting. Another question: Is there going be some changes in the SE suite at this company know Ruth Porat remember you know she she's she already announced Obviously well respected. CFO Who's going to be the replacement? There are some analysts J You see that as a potential Catalyst ahead.

When they finally name that CFO right, we'll be watching to see if there are any indications that we end up getting about who for sure. Okay, so as you can see, I mean for me when I when I see that Google itself sold off so aggressively just because of that news. It really excites me because I just want to buy and hold right because Google's so incredibly bullish. But the thing that this is also reminded me is that you have to think about it very quickly.

Google and Microsoft are some of the big trillion dollar companies that just reported earnings we still have Amazon and Apple. Uh, they are going to be reporting earnings on Thursday and the thing that I want to remind you is that this is kind of setting the tone. So we have a Tesla selloff last week, we now have had Google and Microsoft sell off. We'll see if that sell off continues into tomorrow's Market open and then we have Amazon and Apple reporting earnings Thursday after the Market opens.

So I just want to see if that sentiment continues where markets are too overbought and expectations are too high that based off of what is reported, they miss. and then we see these Corrections So although yes, I do see Google be cheap if overall larger companies continue to report lower than expected earnings, then Google can definitely get cheaper. So this is again just a good reminder of maybe why to stay patient, but to get prepared. So um, wanted to make it as simple um as possible to understand they're obviously investing a lot into Ai and anytime I mean it's a it's a joke where so many companies just say AI So many times during their earnings call and anything that has to do with artificial intelligence has seen um like Nvidia and AMD a huge spike in overall demand.

Uh, so we'll see if this momentum continues into the next uh, you know, next couple of days as Apple and Amazon uh report earnings. So um, other than that again, I'm going to keep um leading up to Apple and Amazon reporting earnings. I'm going to stay relatively a little bit lighter on my positions and I want to be a little bit more careful? uh with the idea of over for trading because I just I want to make sure that I don't jump into something that has the intention to go long. but then Apple and Amazon can maybe drag down the market because of how influential they are due to how large their market cap is.

So very excited to follow up. I'll keep you guys up to date and again, if you guys want me to host those live streams all I literally ask you to do is drop a thumbs up in these videos and subscribe to the channel and I'll take care of the rest. Um, also, don't forget to tune on into our live trading session I Trade Live every morning where you get to see every entry and every exit that I take. If you want to, you know, look into that.

It's going to be the second link in the description down below. And if you sign up today, you can watch me Trade Live as soon as tomorrow at Market Open I Appreciate your time like always. Let's make sure that we end the year on a green note. Take Care Team.