Alcoa kicks off earnings season with a whiff

Alcoa unofficially launched the third quarter earnings season on a bad note.

The aluminum maker reported an adjusted quarterly profit of 7 cents a share, missing analysts 13 cents a share estimate. Revenue of $5.6 billion came in roughly in line with estimates. Adjusted profit during the quarter was down 77% from the same period last year.

Shares of Alcoa (AA) are down more than 3% in after-hours trading. The shares closed Thursday down 8 cents, or 0.7%, to $11.01. The company is preparing to separate itself into two businesses, one to focus on finished product making and one on smelting.

Investors pay close attention to Alcoa's earnings report because it's one of the first major companies to report quarterly profit. The negative surprise from Alcoa sets the stage for a quarter investors expect could be the first decline in profit since the third quarter of 2009. Investors see profit of companies in the Standard & Poor's 500 to fall 5%, says S&P Capital IQ.

It's too soon to completely write-off the third quarter after Alcoa's miss, says JJ Kinahan, chief strategist at TD Ameritrade. "Next week we get four of the major financials with J.P. Morgan, Wells Fargo, Citigroup and Bank of America and that will probably set a much better picture of what the rest of the earnings season can look like," he says.

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