3M beats Q3 forecasts and raises guidance as Amazon data-centre deal lifts stock
3M posted Q3 earnings of $2.50 a share on $6.6bn of sales, raised full-year guidance, and expanded its commercial relationship with Amazon, which gets warrants for 3.2m shares tied to $6bn of data-centre product spending.
3M reported third-quarter earnings on Tuesday that beat Wall Street estimates and raised its full-year guidance, but it may have been the company’s AI data-centre ambitions that did most of the lifting for the shares.
The industrial giant posted earnings of $2.50 per share on $6.6bn in sales, against analyst expectations of $2.38 per share, according to Barron’s. A year ago 3M earned $2.19 a share on $6.2bn of sales. The company raised full-year earnings guidance to a range of $9.10 to $9.15 a share, up from $8.80 to $8.95, and said organic sales grew 3.3% — figures confirmed by 3M’s own results release.
Shares rose 3.6% to $167.89 in premarket trading while S&P 500 futures slipped 0.1% and Dow Jones Industrial Average futures edged up 0.2%.
Also moving the stock was news announced on Monday of an “expanded strategic commercial relationship with a wholly-owned subsidiary of Amazon.com”. Amazon received warrants to purchase 3.2 million 3M shares, vesting once it spends $6bn on “optical connectivity and other data center products”, per Dow Jones via Morningstar.
3M is also collaborating with Genius Electronic Optical on “expanded beam optics”, a fibre-optic connection technology. Fibre optics are a key component of AI data centres, carrying most of the data between server racks — making the Post-it Note maker, improbably, an AI data-centre play.
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