Tuesday, October 9, 2012
Alcoa (AA) Earnings, Revenue Plummet YOY
Earnings and revenue for aluminum giant Alcoa (AA) plunged from the same quarter last year, suffering a net loss of $143 million, with revenue falling from $6.42 billion last year to $5.83 billion this year. Earnings dropped from a profit of $172 million last year to a loss of $143 million this year. I'm not sure why the headlines are screaming about the company meeting analysts' expectations, as the expectations were so low it would have been hard to lose in that environment. Analysts had been looking for the company to generate revenue of $5.54 billion, and for earnings to come in even with last year's numbers. CEO Klaus Kleinfeld continues to beat the drum about aluminum demand going to double sometime between 2010 and 2020, but things will have to change drastically for that to happen in the years ahead. Of course there's little place to go up for the price, so if there ever is the beginnings of a real economic recovery, aluminum prices could shoot up, but there are far too many variables and questions concerning the global economy to be able to even suggest that is going to happen in the near future. Again, I'm not sure how these dismal numbers can be called a beat, other than analysts lowered their estimations so much that it was inevitable that Alcoa would surpass them. But at least they were able to. Anything less would have been an even greater disaster for the struggling company. Some of the segments Kleinfeld says grew were in the automotive business in the United States, as well as the aerospace unit. Alcoa closed at $9.13, up by a penny, or 0.11 percent. In after hours trading the company was down $0.10.