Piper Jaffray's Munster Breaks Down Alphabet (GOOGL) and Amazon.com's Earnings
NEW YORK (TheStreet) --Google parent company Alphabet (GOOGL) - Get Report and Amazon.com (AMZN) reported 2016 second quarter earnings after the closing bell on Thursday and both companies beat analyst expectations.
Amazon posted earnings of $1.78 per share, toppling expectations of $1.11 per share on revenue of $30.4 billion, above estimates of $29.55 billion. Alphabet posted earnings of $8.42 per share, above the projected $8.04, on revenue of $21.5 billion, above the expected $20.76 billion.
Piper Jaffray senior research analyst Gene Munster joined CNBC's "Squawk Box" this morning to analyze both reports and discuss his biggest takeaways from each, beginning with Alphabet.
"It was all about acceleration from revenue which was up 20% versus 18% from last quarter. The takeaway here is search is doing well for Google and they've got some reason to be optimistic about new ad formats that should be positive for revenue growth," Munster explained.
Additionally, another point worth mentioning Munster said when discussing Alphabet was a continued focus on machine learning. "I think this is somewhat of an overused term, but ultimately I think that this is going to have a profound impact," he said before addressing the doubters.
"I've covered Google for a long time and there's always going to be some doubters but I think for the at least the next quarter they have silenced them.," he noted.
Moreover, Munster mentioned that there is room for Alphabet to increase buybacks after the September report, which he feels will "keep investors engaged over the next three months."
Continuing on to Amazon, Munster believes the company is only "strengthening its death grip on traditional retail," and is impressed by continued push to open more fulfillment centers (18 to be opened this year versus only six the previous year).
"The big takeaway here was that unit growth accelerated, it was 28% year-over-year, it was 27% in the March quarter, and 22% a year ago. So those are small increases, but when you think of the magnitude of how big amazon is it's hard to move the needle at all," he explained.
Shares of Alphabet are higher 4.08% to $797.11 and shares of Amazon are higher 1% to $760.17 this morning.
(Amazon.com is held in the Growth Seeker portfolio. See all of the holdings with a free trial.)
(Apple is a core holding of Jim Cramer's charitable trust Action Alerts PLUS. See all of his holding with a free trial here.)