How to Read Earnings Reports — Why a Stock Can Fall on Good Numbers

1. When and how earnings are released

U.S.-listed companies report results four times a year (once a quarter). Reports usually come out three to six weeks after the quarter ends, and the month or so starting in mid-January, April, July and October is called “earnings season.”

• Release time: Most results come out before the market opens (7–8 a.m. U.S. Eastern Time) or after the close (after 4 p.m.). This is to avoid large swings in the share price during trading hours. After-hours results often move the stock sharply in extended trading, so the first reaction shows up before the next day’s open.
• Original sources: The original documents are the investor relations (IR) press release on the company’s website and the 8-K filing submitted to the U.S. Securities and Exchange Commission (SEC).
• You can see scheduled report dates and results in one place on this site’s Earnings Calendar page.

2. Four numbers you should check

Adjusted EPS vs. GAAP EPS: Companies often report both profit calculated under accounting standards (GAAP) and an “adjusted” profit that excludes one-off costs (legal settlements, restructuring charges, etc.). Different articles may use different figures, so check which basis is being used.

3. The yardstick for “beat” and “miss”: consensus

When an earnings story says results “beat” or “missed” expectations, the yardstick is the consensus — the average forecast of the Wall Street analysts who cover the company. Data providers such as LSEG and FactSet compile it.

• Forecasts can differ slightly from one provider to another. That is why this site publishes a forecast only when the same figure is confirmed by multiple sources.
• Most large U.S. companies report results slightly above consensus, often because they issued conservative guidance in advance. As a result, it is common for a slight beat alone not to lift the share price.

4. Why a stock falls when the numbers are good

Let’s look at a real example. On October 21, 2026, Meta reported third-quarter revenue of $64.6 billion, above market expectations (about $63.4 billion). Yet the stock fell 6.98% the next day. The reported reasons were:

1. One-off legal costs: A legal charge of about $9.9 billion pushed operating income below expectations.
2. Cost outlook: The company guided 2026 capital spending to $135–145 billion as AI-related costs keep rising.
3. Cash flow: Quarterly free cash flow (cash earned minus investment spending) turned negative.

As this shows, share prices react to future profits and risks rather than past numbers. For the same reason, a stock can rise even when results miss expectations, if guidance is good.

5. What to check before an earnings report

• Release date and time: Distinguish between a date the company has officially announced and an estimate from a calendar website (this site labels them “confirmed / unconfirmed / tentative”).
• Recent share price trend: If the stock has risen sharply in the month or two before the report, expectations may already be high.
• Share price reaction to past reports: Even for the same company, moves of ±5–10% in a single day after a report are common.
• Guidance items: Whether the company met, raised or cut the outlook it gave last time.

6. Earnings from overseas chipmakers

• Samsung Electronics publishes preliminary quarterly results (revenue and operating profit only) shortly after the quarter ends, an early read on memory demand that often moves Micron and other U.S. chip stocks. Full results follow a few weeks later.
• For memory makers, DRAM and NAND prices and sales of HBM (high-bandwidth memory) are the key numbers. For details, see the Semiconductor Cycle guide.

This article explains how to read earnings figures. It is not a recommendation to buy or sell any particular stock.