TLDR
- Stock futures edged higher Thursday as investors waited for July wholesale inflation data
- Cisco dropped 6% despite beating earnings estimates, as gross margin declined year over year
- Cerebras Systems fell 17-19% after posting a sharp earnings miss and a second-quarter loss
- StubHub tumbled 17% as rising costs wiped out revenue gains from the 2026 FIFA World Cup
- Coherent slipped 4.4% despite beating expectations, hurt by high market expectations after rival Lumentum’s strong results
Stocks moved sharply Thursday as a fresh wave of earnings reports hit the market. Investors were also watching for July wholesale inflation data that could shape the Federal Reserve’s next move on interest rates.
Cisco Takes a Hit Despite Strong Numbers
Cisco reported fiscal fourth-quarter revenue of $17.3 billion, up 18% year over year, beating the $16.85 billion estimate. Adjusted earnings per share came in at $1.22, above the $1.17 forecast.
Despite the beat, shares fell 6%. The issue was gross margin, which declined from the same period last year, unsettling investors.
Cisco’s product orders grew 35% year over year, with networking orders up 40% for an eighth straight quarter. The company guided first-quarter fiscal 2027 revenue to $18 billion to $18.2 billion, above consensus. Full-year 2027 revenue guidance of $72.2 billion to $73.4 billion also topped estimates.
Management expects $7.5 billion in AI-related hyperscaler revenue in fiscal 2027, with hyperscaler orders more than doubling in the fourth quarter.
Cerebras and StubHub Post Losses
Cerebras Systems shares dropped between 17% and 19% after the AI chipmaker posted a big earnings miss. Revenue rose 74.3% year over year to $180.1 million but fell short of the $194 million estimate. Adjusted earnings per share came in at -$2.98, well below the -$0.17 estimate.
Core gross margin improved to 41%, and management said cloud revenue nearly quadrupled year over year. The company’s backlog held steady at around $25 billion.
For the third quarter, Cerebras guided core revenue to $214 million to $216 million, ahead of consensus. Full-year 2026 core revenue is projected at $880 million to $890 million.
StubHub fell 17% after reporting a second-quarter loss. The ticket resale platform saw a revenue boost from the 2026 FIFA World Cup, but surging costs offset those gains.
Other Notable Movers
Coherent dropped 4.4% despite posting better-than-expected earnings. Investors had set high expectations following rival Lumentum’s strong results earlier in the week.
JD.com slipped 3.2% even after the Chinese e-commerce company beat Wall Street’s second-quarter earnings and revenue targets.
On the positive side, Omeros surged 15% after strong second-quarter results driven by the launch of YARTEMLEA, which generated $32.2 million in gross revenue, up 190% from the first quarter.
Fossil rose 7% after beating earnings expectations and raising its full-year outlook. Gross margin expanded nearly 490 basis points to 62.4%.
Virgin Galactic fell 11% after the company pushed back its commercial service launch to February 2027, citing delays in avionics and systems work.
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