- AI networking and servers led the gains. Arista Networks rose 12% after guiding fourth-quarter earnings to $1.26 to $1.30 per share on revenue of $3.9 billion to $4.0 billion, versus LSEG estimates of $1.15 and $3.60 billion; the revenue midpoint is about 9.7% above consensus by our calculation. Super Micro Computer jumped more than 9% after a beat and a fiscal 2027 sales forecast of $72 billion to $82 billion, with the $77 billion midpoint about 11% above the $69.17 billion consensus.
- Skyworks was the biggest loser. Shares slumped about 16% after the company guided fiscal first-quarter adjusted earnings to about $1.25 per share and revenue to $1.80 billion to $1.90 billion, short of LSEG estimates of $1.50 and $1.99 billion. The revenue midpoint is about 7% below consensus by our calculation, in the first combined quarter since Skyworks completed its deal with Qorvo in early October.
- Software and services had mixed reactions. Duolingo surged 11% on third-quarter revenue of $309 million versus $303 million expected and 153 million monthly active users versus 149 million, while Alight popped 17% after raising its 2026 revenue outlook to $2.115 billion to $2.125 billion, above the $2.09 billion FactSet consensus. Freshworks fell about 6% despite beating estimates, after rallying more than 20% over the past three months.
- Some beats were not enough. Avis Budget fell more than 7% as earnings dropped to $5.15 per share from $10.11, a decline of about 49% by our calculation, even as revenue of $3.44 billion edged past the $3.42 billion consensus. Toast slipped 4% after topping estimates and announcing that CFO Elena Gomez will leave at the end of 2026.
What Happened?
A slate of companies moved sharply in extended trading on Tuesday, largely on earnings. Beyond the names above, AMD rose 7% and Block more than 6% after beating estimates, and CVS Health edged higher on a Wall Street Journal report that it will split off its retail pharmacy business. Alight’s adjusted EBITDA guidance of $410 million to $420 million also beat the $404.4 million Street estimate. Freshworks earned an adjusted 22 cents per share on revenue of $245.4 million, above the 18 cents and $245.1 million analysts polled by FactSet expected. Toast said senior vice president of finance Michael Senno will replace Gomez.
Why It Matters?
The after-hours tape shows investors still pay up for AI infrastructure when guidance is strong, even after recent fears of AI overspending. Arista and Super Micro both guided well above consensus, a sign that data center networking and server demand remains firm. Skyworks’ drop shows how harshly the market treats a weak first outlook after a big merger. The Freshworks and Toast reactions suggest that for stocks that have already run, a beat alone is not enough.
What’s Next?
These moves will be tested at Wednesday’s open, where futures are reacting to the Democratic midterm sweep and pressure on AI-linked stocks. Watch whether Arista and Super Micro hold their gains if the broader AI trade sells off, and how Skyworks management explains the combined company’s outlook. For Avis, investors will look at whether the steep earnings decline reflects one-time items or a weaker rental pricing trend.
Affected Tickers and Coins: ANET, SMCI, SWKS, DUOL, ALIT, CAR, TOST, FRSH
Source: CNBC
