As earnings season rolls into February, investors are bracing for another wave of major financial reports(Palantir). While the overall outlook remains strong, this week’s results from Palantir Technologies (PLTR) and Amazon.com (AMZN) are expected to reinforce the bullish sentiment. But there’s a new factor stirring uncertainty: fresh tariffs imposed by the Trump administration on imports from Canada, Mexico, and China.
These tariffs, announced on Saturday, won’t impact the earnings about to be reported, but they could shake up first-quarter results for several companies. And they’ve already rattled the markets.
Tariffs Take a Toll on Stocks
Friday’s stock market action reflected the nervousness surrounding the new trade policies. Early gains faded as the day progressed. The S&P 500, which was up 50 points by noon, saw its momentum crushed by the tariff news, ultimately closing down 31 points (-0.8%) at 6,041. The Dow Jones Industrial Average dropped 337 points (-0.8%) to 44,545, while the Nasdaq Composite slipped 54 points (-0.3%) to 19,627.
While these losses were relatively minor, they marked the second instance of unexpected volatility in just a week. Monday saw the S&P 500 and Nasdaq plunge after reports surfaced that a little-known Chinese firm, DeepSeek, had developed a significantly cheaper AI chip to rival Nvidia’s (NVDA) market-leading systems. Nvidia shares tumbled 15.8% over the week, with its market cap dipping below $3 trillion for the first time since last fall.
The Impact of Tariffs on Consumer Goods
Beyond the markets, these tariffs will hit everyday goods—think cell phones, cars, clothing, Mexican fresh produce, and even maple syrup, thanks to Canada’s dominance in the industry. Canada and Mexico are already planning retaliation, while China is taking its grievances to the World Trade Organization.
Key Earnings to Watch This Week
Amid the trade war concerns, the earnings calendar remains packed with crucial reports from major companies across the Dow, S&P 500, and Nasdaq-100. Here are four stocks investors will be closely monitoring:
Palantir Technologies (PLTR)
- Earnings Release: Monday after market close
- Market Cap: $187.9 billion
- Stock Price: $82.49 (+1.2% Friday, +9.1% in January)
- Earnings Estimate: $0.11 per share (+37.5% YoY)
- Revenue Estimate: $776.8 million (+28% YoY)
Palantir, the data analytics powerhouse led by CEO Alex Karp, has seen a relatively subdued January compared to its staggering 340% surge in 2024. Between the Nov. 5 election and year-end, the stock jumped nearly 48%. Founded with a focus on big data for government agencies, Palantir has strong ties to high-profile tech figures like co-founder Peter Thiel.
Alphabet (GOOGL, GOOG)
- Earnings Release: Tuesday after market close
- Market Cap: $2.51 trillion
- Stock Price: $204.02 (+1.6% Friday, +7.8% January, +20% since election)
- Earnings Estimate: $2.12 per share (+29% YoY)
- Revenue Estimate: $96.7 billion (+12% YoY)
Google’s parent company remains the dominant force in search, mobile (Android), and digital advertising. Like Meta (META), Alphabet faces ongoing antitrust pressures but continues its aggressive investment in AI and AI-related hardware. If DeepSeek proves to be a legitimate challenger in the AI space, Alphabet could actually benefit by reducing its AI development costs.
Amazon.com (AMZN)
- Earnings Release: Thursday after market close
- Market Cap: $2.5 trillion
- Stock Price: $237.68 (+1.3% Friday, +8.3% January, +19% since election)
- Earnings Estimate: $1.46 per share (+46% YoY)
- Revenue Estimate: $187.2 billion (+10.2% YoY)
Amazon remains a Wall Street favorite, with shares soaring 44.3% in 2024 and hitting an all-time high of $238.15 last week. The e-commerce giant continues expanding its reach through investments in logistics, AI, and cloud computing. Its Amazon Web Services (AWS) division leads the cloud industry, and its in-house AI chip development aims to reduce reliance on Nvidia.
Eli Lilly (LLY)
- Earnings Release: Thursday before market open
- Market Cap: $729.4 billion
- Stock Price: $811.08 (-1.5% Friday, +5% January, +0.6% since election)
- Earnings Estimate: $5.16 per share (+114% YoY)
- Revenue Estimate: $13.5 billion (+43.5% YoY)
Eli Lilly has been riding the success of its diabetes and obesity drugs, Mounjaro and Zepbound. However, recent projections for its GLP-1 drugs fell short of expectations, leading to some selling pressure. The stock remains 16.6% below its August 52-week high of $972.53.
What’s Next for the Markets?
With earnings reports from these heavyweights and a brewing trade war, volatility could remain a key theme this week. Investors will be closely watching corporate guidance for any signals on how tariffs may impact future earnings. The road ahead looks uncertain, but one thing’s for sure—the market is in for another eventful week.