Key facts
- Hewlett Packard Enterprise (HPE) stock surged 23% after reporting record second-quarter results.
- HPE accelerated financial goals, raising its fiscal 2026 revenue growth outlook to 29%-33%.
- Broadcom analysts raised price targets to $490, citing strong AI demand.
- Advanced Micro Devices (AMD) received multiple analyst upgrades, with price targets up to $525.
- Lululemon shares dropped 8% after cutting its annual profit forecast and projecting a Q2 sales decline.
- Lululemon's stock has lost two-thirds of its value in 12 months.
- Salesforce reported Q1 revenue of $11.1 billion, up 13% year-over-year.
- Salesforce AI platforms contributed nearly $3.4 billion in annual recurring revenue.
- GameStop announced a record quarterly net income of $389.6 million.
- GameStop approved a new $2 billion share repurchase program.
- ServiceNow's Q1 revenue of $3.77 billion beat estimates with 22.1% year-over-year growth.
- DocuSign reported Q1 cash flow reaching $289 million, driven by AI solutions.
A wave of corporate earnings reports reveals a bifurcated market landscape, with artificial intelligence demand fueling growth for some technology firms while retail and other sectors grapple with challenges. Hewlett Packard Enterprise (HPE) stock surged 23% in extended trading following its record second-quarter results, driven by robust demand for AI data center expansion. The company also accelerated its long-term financial goals by two years, raising its fiscal 2026 revenue growth outlook to 29%-33%. Advanced Micro Devices (AMD) received multiple analyst upgrades, with price targets raised to as high as $525, on the back of strong AI-driven CPU and GPU demand, though concerns about its premium valuation persist. Similarly, Broadcom analysts have raised price targets ahead of its Q2 FY26 earnings report on June 3, with UBS and Susquehanna setting targets at $490, anticipating strong AI demand. Wall Street expects $22.12 billion in revenue and $2.40 earnings per share for Broadcom, with a projected 10.65% stock move post-earnings.
In contrast, Lululemon shares fell 8% after the company cut its annual profit forecast and projected a sales decline in the second quarter, its first since the pandemic, citing product missteps and weak consumer spending. The stock has lost two-thirds of its value in 12 months. Nike shares extended losses due to competitive pressure from brands like Adidas, On, and Hoka, and tariff-related margin strain, with gross margin declining 130 basis points to 40.2% and revenue remaining flat year-over-year at $11.3 billion. Salesforce reported Q1 revenue of $11.1 billion, up 13% year-over-year, with AI platforms contributing nearly $3.4 billion in annual recurring revenue, but its Q2 revenue projection fell below analyst expectations, and bookings missed estimates for the second consecutive quarter.
Other companies reported mixed outcomes. GameStop announced a record quarterly net income of $389.6 million and a 14% year-over-year increase in net sales to $835.3 million, driven by collectibles, and approved a new $2 billion share repurchase program. ServiceNow's Q1 revenue of $3.77 billion beat estimates with 22.1% year-over-year growth, attracting institutional interest. DocuSign reported strong Q1 financial results, with cash flow reaching $289 million, driven by AI-powered Identity and Access Management solutions, surpassing expectations, though its stock slipped due to cautious future financial projections. Veeva Systems Inc. also surpassed earnings expectations and raised full-year guidance, but its stock fell in after-hours trading as analysts lowered price targets due to growth outlook, valuation, and AI disruption concerns. Zscaler received an upgrade to Buy with a $214 price target, despite a post-earnings drop after guiding FY2027 revenue and ARR growth below expectations, with Guggenheim citing a rich pipeline of large deals. GitLab shares declined following a workforce reduction plan, even as its Q1 results surpassed expectations. Oklo Inc. shares dropped approximately 11% after a co-founder and CEO sale of around 200,000 Class A shares. Snap shares declined 1.5% amid doubts on its turnaround strategy and ability to improve profit margins, despite modest revenue growth and narrowing losses, with layoffs aiming for $500 million in savings. Cognyte Software's stock declined due to a year-over-year decrease in quarterly revenue. Torrid's stock dropped 21% after issuing weak fiscal 2026 net sales guidance of $940 million-$960 million, despite beating Q1 expectations. Ambev's stock remained stable, outperforming the Ibovespa index due to strong consumer demand and solid quarterly results.
Looking ahead, several companies are scheduled to report their earnings results on June 1 and June 2, 2026, which will provide further insights into company performance and future outlooks. Investors are closely watching these reports for impacts on stock prices, particularly in light of ongoing AI developments and broader economic conditions.