The World Cup may be a “yellow card” for earnings at US technology companies as hundreds of millions of fans worldwide glue themselves to the soccer tournament in South Africa, Goldman Sachs Group Inc said.
In the quarter coinciding with three of the last five World Cups, technology companies on the Standard & Poor’s 500 Index had their biggest earnings-per-share misses of the year, Sarah Friar, a San Francisco-based Goldman Sachs analyst, wrote in a report this week.
By contrast, the April-to-June period was the worst quarter in only three of the past 15 non-tournament years since 1990, she wrote.
“World Cup-year second quarters appear more susceptible to missing consensus estimates,” she wrote. “With macro and currency concerns already weighing on technology stocks, some view the World Cup as another possible near-term negative.”
The planet’s most popular sporting event kicked off last week and is expected to draw half a billion TV viewers globally by the time it ends on July 11, according to FIFA, soccer’s governing body. Even in the US, where the sport’s popularity lags behind American football and basketball, about 14.5 million people tuned in a match this week between the home team and England, according to estimates from ratings-company Nielsen Co.
The information technology sub-index of the S&P 500 has risen 3.7 percent since Friday, when the tournament started, while the broader index gained 2.6 percent.
“Some impact is a possibility, though the likelihood is not overwhelming,” Friar wrote.
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