Published on 29 Apr 2024 on Zacks via Yahoo Finance

What's in Store for These 4 Technology Stocks in Q1 Earnings?

Technology stocks are expected to report strong quarterly results, driven by the increasing adoption of generative AI technology.The strong demand for generative AI chips required in large language models has been on the rise, which is expected to have continued benefiting the semiconductor companies in first-quarter 2024.The increasing adoption of machine learning (ML), Augmented Reality/Virtual Reality devices, quantum computing, and cloud computing is expected to bolster the performances of the technology companies.Strong demand for data centers, fueled by the need for increasing cloud capacity to support AI-related workloads, is anticipated to have acted as a tailwind.Rising PC shipments and signs of improvement in memory spending, especially in NAND and DRAM, are likely to have aided the technology stocks’ performance in the to-be-reported quarter.The adverse effects of the ongoing war between Russia and Ukraine, macroeconomic headwinds, including persistent inflation, and unfavorable currency fluctuations are likely to have hurt the sector’s prospects in the to-be-reported quarter.

Insight Into Key Releases

Here we discuss four stocks in the Zacks Computer and Technology sector, namely, Advanced Micro Devices  AMD, IPG Photonics IPGP, Littelfuse LFUS and Skyworks SWKS, which are scheduled to release their quarterly earnings on Apr 30.Per the Zacks model, a company needs to have the right combination of two key ingredients — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — to increase the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.You can see the complete list of today's Zacks #1 Rank stocks here.AMD is expected to benefit from its robust portfolio and an expanding partner base. The adoption of its fourth-Gen EPYC processor by hyperscalers to power their internal workloads and public instances is expected to have acted as a tailwind in the to-be-reported quarter.AMD expects first-quarter 2024 revenues to be $5.4 billion (+/-$300 million). The Zacks Consensus Estimate for revenues is pegged at $5.42 billion, suggesting growth of 1.24% year over year.The consensus estimate for first-quarter earnings is pegged at 60 cents per share, up by a penny in the past 30 days.The combination of a Zacks Rank #2 and an Earnings ESP of +28.33% increases the odds of an earnings beat for AMD. (Read More: Should You Buy Advanced Micro Devices Ahead of Q1 Earnings? )