Apple and Amazon Earnings Roll In, Eli Lilly Tanks, And Markets Brace For Jobs Report 5/1/25

0:00Live from the Nasdaq market site in the heart of New York City's Times Square this is fast money Here's what's on tap tonight. Another big night of earnings. Apple and Amazon headlining the action tonight, but we've got reports from many more. We are dialed into the calls to bring you all the details. Plus, losing weight. Shares of Eli Lilly paring down in a big way, seeing their worst day since 2008. Why the company's earnings report sent the stock sharply lower. And stocks in rally mode. The Nasdaq now back above where it was on President Trump's so-called Liberation Day. Can the momentum keep going?

0:29And what will tomorrow's jobs report mean for the run? I'm Melissa Lee coming to you live from Studio B at the NASDAQ. On the desk tonight, Tim Seymour, Carter Worth, and Guy Adami, three musketeers here. We start off with a triple night of earnings tonight. Apple, Amazon, Airbnb all reporting in the last hour as well as a slew of other names. We've got full team coverage of the results. Deidre Bosa standing by on Airbnb. Kate Rooney's got the details on Amazon. We start off with Steve Kovac who's got Apple results and more on the company's monster buyback. Steve. monster buyback mel but not as big as the monster buyback a year ago we'll get to that in a second first let's go over the results here apple's eps was a beat at a buck 65 street wanted to see a dollar 63 per share apple revenues were also a beat 95.36 billion street was looking for 94.66 and then iphone revenues this is a beat as well 46.84 billion dollars beating by about a billion and up 2 % year-on-year.

1:24Services, though, just a teeny, teeny, teeny, tiny miss here. Still up about 12%, though. That is likely what's hanging on the stock right now after hours. China revenues down slightly 2 % year-on-year to$16 billion, but showing some improvement quarter over quarter. And then I did catch up with CEO Tim Cook on all these results and talked about a number of topics. First, on pool for demand, we talked about that a lot going into these results. Tim Cook telling me, quote, But we don't believe that there was a significant pull forward due to tariffs into the March quarter. There's no obvious evidence of that.

1:58And then on China, going into this report, also something that he teased last quarter about those national subsidies for some electronics. He's telling me, quote, that they have this national subsidy program and it's helping to some degree. You can see in our results accelerated sequentially. We were at negative 11 percent in the Q1 time period. We accelerated to a negative 2%. And then he goes on to say, if you measured all that in constant currency, they were roughly flat for the year or year and year rather. And then on India, another huge topic of conversation about all those iPhones being produced there to get around tariffs.

2:35He says, if you look at the current quarter that we're in now, if you look at the U.S., over half of the U.S. sales of iPhone come from India. That's a really important thing. But how on the rest of tariffs, we're expecting to hear more from Mr. Cook on the call, which is getting kicked off right now. Also, guidance. Will they pull their guidance or give a little bit less color than normal due to all the uncertainty we're seeing out there? We'll find out in a few minutes, Melissa. Steve, back to the services number. I mean, wasn't 12 percent basically consensus? Yeah, it's almost in line. It was just slightly lower than expectations by just just a few million dollars, I think.

3:13So that could be what's weighing down on the stock here. But other than that, it's a big growth quarter. Can I also ask you potentially a stupid question, but I think a lot of people want to know the answer. How would you know that the sales that they booked in the quarter were not pull forward? Yeah, that is a very good question. I know I can only tell you what Mr. Cook told me, which is he saw no evidence of pull forward. And that doesn't mean this. Keep in mind, this is March before the Liberation Day tariff. So it's definitely possible in April, which is the quarter we're in now, that they did see some pull forward in early April.

3:48We just don't know that yet. We're going to have to wait to see if maybe we get a hint of that in the guidance, Melissa. Right. OK, Steve, keep us posted. Steve Kovach, that Apple call going on right now, it's now about three percent. Timothy, what do you make of the quarter? I'm in trouble, Timothy. And by the way, not a dumb question and very interesting, because, you know, if you're looking at headlines coming out of the journal right now, Now, they're basically saying iPhone demand surged ahead of tariff uncertainty. So I think that's part of the problem with this number. It does look fantastic.

4:18If you look at the March quarter, these are the best numbers in a couple of years. You can't like the service numbers. And you can't like the service numbers because that's been supporting the margin and ultimately supporting the valuation. Should a hardware company trade it 30 times? No. Should a hardware company trade it 34 times? No. And, you know, it's traded anywhere in there. And if you put even a 28 on this thing, I think the company is probably going to struggle a little bit. So that's the story. I do think the Indian news, how much production, how quickly is stuff that the market really cares about in the medium term.

4:52But in the short term, I really do think it is about where's the new demand coming from and how much of a hit will China be. Yeah. I look at it and I understand what Tim is saying, but now services are almost 28 percent of overall revenue. So even though it was a very slight miss, it's a bigger percentage of overall revenue. It might be the biggest we've ever seen. I don't know. My sense is it probably is, which sort of justifies it. Margins are holding in there. To your point, there's no way to tell unless you say historically in this quarter, if we saw it pull forward, we'd be seeing this plus X or something.

5:23I don't know how they came to that determination. I'm sort of surprised the stock is sold off. Sounds like we've got an apple ball. No, no, no. I just want to be fair here. I mean, I'm surprised the stock is lower on the back end. I mean, you have to be so defensive about being an Apple board. There's nothing wrong with that. I still love you. No, in all seriousness, I raise that question because there was pull forward with everything else out there. Everything. Of course there was. Cars, clothes, everything. So why not an iPhone, one of the biggest purchases people would make, especially if there is an impending upgrade cycle and there are old iPhones out there.

5:58And you know that you, I know that I have an iPhone 11 and I need to upgrade. Why wouldn't I do it before the tariffs? I didn't, by the way. But that's beside the point. Carter, what do you make of the stock? Well, I mean, I don't think there's anything idiosyncratic about the stock. I think that it's the same setup we've seen in other big stocks. We know that almost all stocks that have been very important have advanced for the past two years, all broke hard with the market, all have ricocheted. And now two that gapped up, Microsoft and Meta, now we're going to get the opposite out of Apple and Amazon.

6:28And so I don't think there's anything unique to this. and I think it's a question of whether one fades these moves or not. My hunch is to fade. All right. By the way, an increase in the dividend 4 % by 4 % and up to$100 billion in share repurchases. Well, that speaks to the capital market side of their business, which makes Apple extremely defensive. And I do think Apple will be somewhat defensive. The hardest thing here is the multiple. I accused Guy of being an Apple bull. I'm actually Long Apple. So you are an Apple bull. So to the extent that I actually believe in the story And I don't believe that we priced in AI refresh.

7:03I really don't. And maybe we shouldn't have. In fact, Apple intelligence really isn't a whole lot of anything. What kind of worries me here, and it's great having Carter, isn't that a downtrend on Apple that I'm looking at really from kind of the end of the year that right now it could be selling off right at the top end of that down channel? And that's the setup that is, I know Microsoft is also back up to the downtrend and Microsoft has gapped above that. But I think the issue really for Apple, because it's always about one thing, are you generating alpha in your selection? It's relative performance.

7:35The Q's peaked in Q4 of 2022 or Q1 of 2025. It has not delivered the goods. All right. Let's get to Amazon shares right now. They are also falling in the after-hour session. Despite a top-and-a-bottom-line beat, the conference call kicked off at the top of the hour. CNBC's Kate Marais got the numbers. Hey, Kate. Hey, Mel. Yeah, so Amazon earnings did beat by 23 cents on strong revenue for the quarter. A miss, though, on cloud growth really hitting the stock after hours. It has been down about 4 percent around that range now. AWS growth was the big disappointment for investors, though. It was 17 percent year over year, shy of consensus, which was looking for 17.6 percent.

8:11And expectations had been even higher heading into Amazon's print after Microsoft's strong quarter on the cloud side. The whisper number was around 20 percent as far as expectations. Q2 operating income as far as guidance was also disappointing as well. although Q2 revenue guidance was stronger than expected. Amazon noting a slight headwind from foreign exchange in Q2. Advertising was a bright spot, up 19 % year-over-year, beating expectations. North America's sales beat, but retail margins did contract sequentially. Tariff impact in the press release was called out explicitly in the forward-looking statements.

8:45We do expect to hear more about that. Andy Jassy just mentioned this on the call right before we were coming to Aramela. I want to get you to this comment quickly. He said here, obviously, None of us know where tariffs will settle or when. We haven't seen any attenuation of demand yet. To some extent, we've seen heightened buying in certain categories that may indicate stocking up in advance of any potential tariff impact. Also said we have not seen the average selling price of retail items appreciably go up yet. So that is brand new from the earnings call. Mel, back over to you. All right, Kate, keep us posted.

9:16Thank you, Kate Rooney. Amazon shares down by 3.6 percent. So basically guidance, the revenues at least, the bracket was above where consensus is. I mean, consensus is at the bottom of the bracket. But there's a big asterisk here with this guidance. So if you're, yeah, it's the second quarter operating income guidance, which was$13 billion to$17.5, and the street was at$17.6. So that ratcheted things down. Okay, that's fine. But then you look at the quarter itself, 11.8 % operating margins. I mean, that's pretty extraordinary, I think. The street was looking for 11.3. It's up from 10.7 a year ago.

9:52I mean, these are all good numbers. Yeah, you can nitpick here without question. And maybe cloud disappointed a little bit. But I think you hit the nail on the head. I think that guide is giving people a little bit of a concern. And drilling into that margin, operating income margin at AWS at the street, I think, by 350 basis points. So this profitable part of the business that we all know, some people say you get e-commerce for free, is part of the story. I think it just gets into Amazon has always had some cyclicality to it. And I feel like that's a term I know I've been using this week on Fast Money because I do think it's very important when we think about a week when we've digested not some great macro.

10:28And we're trying to contemplate what's really going on in addition to tariffs. And I think in the case of Amazon, that's part of the story here. I do think that the e-commerce business, it's a secular trend. It's their business to control and dominate, I think. I mean, Walmart would say something different. But I think on AWS, again, growing cloud. and then they add this marketing business. So, I mean, I like it. I like it relative to itself on valuation. I think you have plenty of headlines that don't look great for Amazon, but I think in the medium term, you love this stock. Do you? Again, I don't think there's anything specific.

10:59It's just the nature of this market right now. We know macro is the big thing. Amazon's been an uptrend for the past two years, yes. Amazon drops hard with almost every other stock starting in February, yes. Amazon's ricocheted, yes. And here it is sort of in the middle of the tennis court, if you will, no man's land. If you were, I mean, did I just hear a pair of twos? It might just be. I learned just the other day was the worst hand you could possibly have, except for five random cards. I didn't even know there were five cards in the hand, but now I learned a lot that day. It depends on what you're playing.

11:31No, but, you know, pair of twos, but we talked about 2-7 offsuit being, you don't want that. Yeah, I don't know what you're talking about now. Let's move on, guys. Okay, Mel, I'll do that. You know, what all these stocks have in common, though, and the broader market does as well, The 50-day moving average crossed down through the 200-day. We've talked about this ad nauseum on the show, this death cross. All these individual names and the S &P 500 all have traded back up to the 50-day. Some have overshot it. Microsoft, for example. The question is, with those death crosses or that formation, is it strong enough to thwart what has been some good quarters?

12:05And to Carter's point, all these moves have gotten us back to a level. Is it, in fact, a pair of twos that you fade? We're going to find out over the next couple of days. All right, let's get more on these tech results with Deepwater Asset Management's Gene Munster. Gene, great to have you. Hi, Melissa. Let's kick it off with Amazon since we were just talking about that. You think the guidance is actually better than how the street is interpreting. Can you explain? Exactly, Melissa. They typically come in at the high end of their range, and so you have to factor that in. Look at the high end. The high end was 2 % higher than where the street is at for the June quarter.

12:37And that really is a powerful statement relative to the macro we're in. And that's what I'm curious to hear on the call is like what was factored into that? Were they being conservative? Were they taking the current environment and running with it? Whatever that might be. But that piece on the operating income side, a lot of people looked at that as a disappointment. Again, you have to go to the high end of the range that was in line with the street. So the way I look at this, they guided revenue up by 2 % in a really tough retail market. So I see that as a net positive. I mean, Gene, just to be clear, the guidance that Amazon gave is for the second quarter, correct?

13:09I mean, there are a lot of things. That's correct. For instance, you know, in the e-commerce side of the business, I've read reports that, you know, they believe that there is enough inventory pretty much to cover through May. And so that would encompass pretty much the entire quarter. So their ability to give guidance for the current quarter is much greater than the back half of the year. So, you know, embedded with this, along with this asterisk to the second quarter, there's also the big unknown of the second half of the year and how they're thinking about that second half of the year. That's a big piece to it, too.

13:39Just one more just on this what's going to happen in the June quarter. That's true on the inventory side, but there is an element in terms of how consumers are thinking even if they're able to keep pricing where they're at because they've got inventory. There is a question about how consumers are going to be spending. And so I think that that guidance, in my view, plus 2 percent factors in is a little bit more resilient of a consumer than what I would have thought a couple days ago. All that said, you're correct. Like, the back half of the year is going to be any commentary about that is going to have a big impact on how the stock trades tomorrow.

14:12How about Apple, Gene? What did you make of Tim Cook saying he has no idea whether there's pull forward? Well, I think that this is the first time in a long time I've said that they beat the iPhone number, and that's important. I think Cook, he's a straight shooter, and I think he can see the numbers. He can see what happens. If they would have seen a spike in the last week of the quarter, for example, I think he would have reported that. So I think you need to take this plus 2 % iPhone number at face value, the 2 % growth, and that's a solid number. But the real question isn't related to the iPhone number.

14:45And the long time that I've been following and researching this company, investing in it, I think that the dynamic around what's going to happen and their commentary around shifting production tariffs and AI is going to be a big part. I would mention this. In terms of AI, Cook, and the prepared remarks just before I jumped on here, did mention that they have more of their own models that they're starting to implement. What he's, I think, starting to tease out is they're not beholden to Gemini or OpenAI and trying to show to investors that they've got more AI chops than they're given credit for.

15:17Gene, are you worried about any of the Google revenue, which is 25 % of, again, operating income and a lot of headlines around this, and would really be kind of a game changer? It's the kind of annuity that makes Apple kind of an annuity in terms of that buyback. If I kind of think about all these pieces, I think that Google piece is probably the thing that makes me not rest well at night. I think they're going to actually figure out the tariff stuff. I think they're going to figure out what's going to happen on production over time. They'll sort all that out. But how this Google revenue, that's, you know, call it, it's 10, 15 percent of their earnings.

15:53I mean, it's a big number that they get from that relationship. And so I think that that is something that, you know, this, the case that came up, this revision related to the Epic trial today. I just want to remind people that Apple made these decisions and tweaks and adjustments knowing that this could happen. I think that they're going to prevail on this, but ultimately that's related to the Epic thing, which is somewhat related to Google. I think that the Google piece is an unanswered question. We're not going to get clarity tonight. What I think investors are going to leave with tonight is pretty straightforward.

16:25They got a billion and a half customers that love their products. They're not going anywhere. Even if it takes them three years to figure AI out, they're not going anywhere. And I think investors are going to give them the benefit of the doubt that they're going to be able to navigate all these cross currents in the near term and get to much higher growth in 2026. Stand by, Gene. We're going to go back to Steve Kovach, who's got some more details from the conference call. I believe Tim Cook is talking about tariff impact. Steve? Yeah, that's right, Melissa. So just some commentary here from CEO Tim Cook about tariff impact here.

16:56The headline number here is Cook saying, assuming everything stays the way it is right now, they're expecting a$900 million cost in the June quarter due to the tariffs. Again, as we know, things can change. Things can go back and forth. But right now, as things stand, he's saying to expect a$900 million cost in the quarter, but also saying they can't predict beyond that just because of so much uncertainty. also saying in related tariffs for the March quarter, the quarter that they're reporting on, there were some limited impacts is the way he said from tariffs, but they were still able to have some supply chain optimization and get inventory ready for the current quarter we're in, which may be some of those reports that we got about iPhones being flown in in India and stuff like that.

17:40He didn't say that directly, but that's kind of how I read it. So basically getting things ready for the June quarter to mitigate the impacts, but still expecting a$900 million cost because of the tariffs, assuming everything stays the same here, Melissa. And we're seeing the stock lift off of the after-recession lows. Steve, thank you. Steve Kovach, keep us posted, stock down 2%. Gene, your quick take on that$900 million cost. Yeah, that$900, we can put in the numbers. That's 1%, a 1 % hit they're talking about to earnings, 1 to 1.2%. Pretty modest. And I think that's why you're seeing the stock move higher.

18:13All right, Gene, we'll check Back in with you. Thanks for that. Thank you. Guy, your take on this quarter. Well, I mean, down 2 % in China off the last quarter, down 11. I think it's a win. I think, you know, services being a bigger percentage of overall revenue, I think it's a win. I think margins holding in there is a win. I think it's all pretty good. I'm surprised the stock is off, you know, marginally. But again, technically, a lot of these stocks, I think, are breaking down. All right. We'll keep an eye on Apple and Amazon, of course. Keep you posted on the conference calls. Meantime, we've also got all the other after hours action.

18:43Airbnb, Live Nation, Amgen, Roku, Instacart, all reporting results. The details out of the quarters next. And speaking of earnings, shares of Eli Lilly dropping on the back of their results this morning. Why top and bottom line beats were not enough for investors. Do not go anywhere. Fast Money is back in two. Welcome back to Fast Money. Eli Lilly dropping over 11.5 % after earnings for its worst day since the financial crisis. The farmer giant beating estimates, but shares getting hammered on trimmed guidance and on news that CVS Caremark will make rival Novo Nordisk's Wiggovi its preferred GLP-1 drug.

19:17Caremark will also drop Lily's Zepbound from its standard formularies list. For more on all this, Mizuho healthcare strategist Jared Holtz joins us here on set. Jared, always good to see you. That 11 percent decline, how much of it was CVS? How much of it was the results? Tough to say, but I think on a day where pharma struggled, I think maybe 2 or 3 percent pharma weakness, just a couple percent on the sector rotation, dynamics, et cetera. The quarter, I thought, was fine, not anything to write home about. And so maybe an extra 5 % for CVS Novo. I mean, it doesn't seem like it's going to be doomsday for Lilly by any means, but you don't want a competitor out there linking up with a PBM and taking share.

19:59So it kind of makes sense. How much of an impact is it losing CVS Caremark for Lilly? We don't really know. I mean, they're no longer the preferred vendor. It doesn't mean they can't prescribe it for certain patients that, you know, are looking for extra weight loss. We don't know the details of this plan as of yet. But a lot of patients are starting on the Novo drug and then they're opting to go to ZepBound because of either adverse events or they want more weight loss. So I do think there's a possibility that it starts out fairly favorable for Novo, but in the end winds up being a small impact.

20:31So, again, this isn't a day where that relative value trade tilts you more towards Novo. And again, then weaving that into the earnings just to complete the question, they reaffirm guidance. I mean, this is a company that's kicking on all cylinders, and these are tough headlines, but it doesn't change that view? It doesn't. I mean, I've been on here. I mean, last time we spoke, I mean, I was kind of bullish on Novo at 70, right? So it's kind of like right back there hasn't done much. I was probably bullish at 80. Yeah. So, I mean, the valuation argument has been there for Nova for a while because the disparity has been so massive.

21:04I still think on a 12 percent pullback or 11 to 12 percent pullback in Lilly, you got to buy some. You've got oral next year. The earnings are still rock solid. I don't really think this changes the trajectory for the drugs at all. So you just have like a better opportunity to buy it now than you did yesterday. You have to have staying power, though. Does today's action show that maybe the valuation cushion, to the extent that there is one, is just not there and it's sell first, ask questions later? It's tough to say on the valuation. It's been trading in a bubble for such a long time relative to the group.

21:34Is today the day where everyone kind of decides that it doesn't deserve to trade at 2 or 3x the peer group multiple? I'm not sure that's the case. It's still by far, when you look at the fundamentals across Pfizer, Merck, Bristol, you still wind up coming back to this one. It's just a matter of what you want to pay for it. But I think on weakness, you kind of have to buy it. What are the odds as time goes on that Novo actually buys an asset, buys a drug in the pipeline? I mean, Pfizer got a huge boost, just sort of alluding to the fact that it would be in the market to buy something. You saw GPCR.

22:05You saw Viking pop on that. I mean, why wouldn't Novo just do that? I think they eventually have to. I think they will. I mean, are they stubborn to some degree because they feel that they're the market leader and don't have to or one of the market leaders and don't have to? I would think that's probably part of the equation. But as time goes on, if they don't have an oral offering and you've got Lilly on the market next year with or for Glypron, it's going to be pretty bad for them. So I'd say high chance, just timing is tough. All right. We've got to leave it there, Jared. We've got some news on Amazon.