Monday, November 20, 2023

Good news for analysts everywhere just before the Thanksgiving holiday: Calcbench has released its Q3 2023 Wrap-Up, so you have something to read surreptitiously on your phone while the in-laws gripe about politics.

We release our wrap-ups at the end of every earnings season (you probably figured out that part already) to study broad trends in revenue, net income, capital spending, and other important metrics. This quarter’s report tallies up the data for more than 3,300 non-financial firms — not quite every filer that’s out there, but more than enough to give us a sense of this quarter’s corporate performance. 

Most notably, we saw an 11.8 percent increase in net income compared to the year-earlier period. That compares to more modest increases in capital expenditures (up 3.4 percent) and inventory (up 1.7 percent), and overall revenue actually edged downward by 1.1 percent. See Figure 1, below.

(To be clear, all firms included in this report filed earnings for Q3 in both 2023 and 2022, for the most apples-to-apples comparison.)

The Q3 Wrap-Up also examines three specific sectors: retail, software, and chemicals, to get a sense of how performance varied from one sector to another.

Sometimes that performance varied by a lot. The 230 companies in our retail group, for example, reported a year-over-year jump in net income of 148.4 percent, while capital expenditures dropped 11.2 percent. Various specific companies had equally impressive numbers. Walmart ($WMT) revenue rose 5 percent; ($AMZN) net income jumped from $2.9 billion to $9.9 billion.

Meanwhile, the software sector saw year-over-year revenue rise 9.5 percent, while net income rose 72.7 percent — led, not surprisingly, by tech giants such as Facebook ($META), Google ($GOOG), and Microsoft ($MSFT), which all reported multi-billion dollar increases in profit. See Figure 2, below.

The highlights in this report are a great place to start when analyzing Q3, but they certainly do not tell individual stories of specific companies. For example, Berkshire Hathaway ($BRKA) reported a year-over-year revenue of $16.3 billion (yay!) and a decrease in net income of $9.8 billion (yuck). To find out more about the specific companies you follow, you’ll need to do more digging and reading in the footnote disclosures. 

For example, did you know Berkshire reported investment losses of $24.1 billion in the quarter? We did, because our Interactive Disclosure tool lets you dig into the footnotes and bring those important kernels of insight to the surface in short order. 

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