bring in Maxim Group, senior consumer internet analyst Tom Forte. He has a hold uh on Apple and a buy on Amazon with a 272 price target. I'm just taking a look at Amazon there.It's 226 U. Tom. All right, let's start with Amazon.After what we saw from the cloud businesses of Alphabet and Microsoft, what are your expectations for the allimportant Amazon Web Services component of Amazon overall. >> Yeah. So David, what's interesting about Amazon is that earlier this week from a headcount standpoint, they annou ...

Amazon - Amazon Web Services (AWS) is facing challenges compared to Microsoft and Google due to its slower growth rate and less direct ties to open AI technologies [3][4] - The recent layoffs announced by Amazon are the largest in the company's history, which may impact its operational efficiency [2] - If AWS revenue growth meets or exceeds the previous quarter's growth, it could positively influence Amazon's stock price in the near term [5] Apple - The iPhone 17 is reportedly outperforming expectations, with management guiding for mid to high single-digit revenue growth for September [6] - Ongoing geopolitical discussions between the U.S. and China may benefit Apple, particularly regarding the sourcing of rare earth minerals critical for consumer electronics [7][8] - The easing of geopolitical risks has contributed to a rebound in Apple's shares, indicating positive market sentiment [9]

Core Viewpoint - Amazon.com Inc (NASDAQ:AMZN) is highlighted as a strong investment opportunity due to its attractive valuation and potential for growth in the cloud sector, despite facing challenges in its e-commerce business [1][3]. Valuation and Market Position - The stock is currently trading at 25 times forward earnings, one of its lowest valuations ever, indicating a potential for upside [2]. - The company has increased its position in Amazon from 4.5% to 6%, suggesting confidence in its future performance [2]. Cloud Business Performance - AWS experienced a year-over-year revenue growth of 17.5% in the second quarter, which is a deceleration compared to previous quarters, while competitors like Microsoft Azure and Google Cloud reported growth rates of 26% and 32%, respectively [3]. - The shift in the cloud market towards AI-first platforms is impacting AWS, as companies are now favoring solutions that integrate generative models [3]. Investment Strategies - Mairs & Power Balanced Fund initiated a new position in Amazon during the second quarter, capitalizing on stock weakness due to tariff news and market declines [4]. - The fund believes Amazon is well-positioned to capture market share in retail and grow its cloud business [4].

Core Viewpoint - The recent initiative by Amazon and other e-commerce platforms to report tax information of Chinese sellers has sparked significant reactions in the cross-border e-commerce industry, indicating a shift towards compliance and regulation [1][2]. Group 1: Tax Reporting Regulations - Starting from October 2025, Amazon will report relevant information of Chinese sellers to tax authorities quarterly, including seller identity, transaction volume, income, and fees [2]. - This marks the first time Chinese cross-border sellers have received such tax information reminders, following the issuance of regulations by the State Council and the National Taxation Administration earlier this year [6]. - As of October 15, 2023, over 6,654 domestic and foreign platforms have reported their basic information, with more than 4,100 platforms reporting tax-related information, exceeding 60% of the total platforms required to report [6]. Group 2: Industry Impact and Seller Response - The new tax compliance measures are expected to challenge mid-tier and small sellers, many of whom have historically maintained a "0 declaration" status and lack compliance awareness [8][9]. - Larger sellers, particularly listed companies, are generally well-prepared for compliance, while mid-tier sellers are hesitant to invest in compliance due to concerns about costs becoming sunk [8][9]. - Small and micro enterprises, which often operate with low profit margins and limited resources, are particularly vulnerable to the new regulations, as they have previously lacked a robust compliance framework [9][10]. Group 3: Compliance Challenges and Strategies - Some sellers are attempting to evade tax obligations by using Hong Kong companies as intermediaries, but this approach is deemed non-compliant and risky [12][14]. - Industry experts suggest that sellers should focus on refining their product offerings and adapting their operations to meet compliance requirements, rather than seeking loopholes [12][14]. - The long-term vision for the industry involves a transition from a focus on scale to one centered on quality, with larger companies setting a compliance and quality benchmark for the industry [11][13].

Earnings Reports - 173 S&P 500 companies are reporting earnings this week, with Apple and Amazon.com reporting after Thursday's close [1] - 84% of the S&P 500 companies that have reported so far have beaten forecasts, indicating a strong Q3 earnings season [1] - Q3 profits are expected to rise by 7.2% year-over-year, the smallest increase in two years, while sales growth is projected to slow to 5.9% year-over-year from 6.4% in Q2 [1] Market Reactions - US stock indexes are mixed, with Meta Platforms down over 10% and Microsoft down over 2% due to disappointing earnings, while Alphabet is up over 4% after beating Q3 earnings [4][5] - Chipmakers are experiencing declines, led by Nvidia's 2% drop after comments from President Trump regarding sales approvals [13] - Sprouts Farmers Market reported Q3 net sales of $2.20 billion, below the consensus of $2.23 billion, leading to a decline of over 24% in its stock [15] Economic Indicators - The US government shutdown is ongoing, affecting market sentiment and delaying the release of key economic reports, with an estimated 640,000 federal workers furloughed [7] - Eurozone Q3 GDP rose by 0.2% quarter-over-quarter and 1.3% year-over-year, exceeding expectations [11] Interest Rates - Markets are pricing in a 70% chance of a 25 basis point rate cut at the next FOMC meeting on December 9-10, with an overall expected cut of 81 basis points by the end of 2026 [3] - The 10-year T-note yield has risen to a 2.5-week high of 4.11%, influenced by reduced safe-haven demand and rising inflation expectations [9][10]

Core Viewpoint - The Federal Open Market Committee (FOMC) announced a 25 basis point interest rate cut, with mixed reactions in the stock market, particularly among major tech companies reporting earnings [1][2]. Group 1: Microsoft - Microsoft reported Q3 revenue of $77.67 billion, an 18% year-over-year increase, and operating income of $37.96 billion, up 24% [3]. - The diluted earnings per share (EPS) was $3.72, reflecting a 13% increase year-over-year [3]. - Azure cloud services experienced approximately 40% growth, matching the highest growth rate in two and a half years [3]. - Despite strong earnings, Microsoft's stock fell slightly in after-hours trading due to supply constraints in cloud services [3]. - CEO Satya Nadella indicated that Microsoft has signed cloud contracts worth $392 billion that are yet to be realized [5]. - To meet the rising demand for AI and cloud services, Microsoft plans to increase AI computing power by 80% this year and double its data center capacity over the next two years [6]. Group 2: Meta - Meta's Q3 revenue reached $51.24 billion, a 26% year-over-year increase, with expectations for Q4 revenue between $56 billion and $59 billion [6]. - However, net profit plummeted 83% from $15.69 billion to $2.71 billion, primarily due to a one-time tax expense of $15.9 billion [6][7]. - Following the earnings report, Meta's stock dropped over 8% in after-hours trading [7]. - Meta plans to significantly increase capital expenditures next year, with analysts predicting a rise from $72 billion this year to $97 billion, driven by AI infrastructure investments [9]. Group 3: Alphabet - Alphabet's Q3 revenue surpassed $100 billion for the first time, reaching $102.3 billion, a 16% year-over-year increase, with net profit growing 33% to approximately $35 billion [10]. - Cloud revenue was $15.2 billion, marking a 34% year-over-year growth [10]. - Following the earnings announcement, Alphabet's stock rose by 7.7% in after-hours trading [10]. - The company raised its capital expenditure budget to $91-93 billion, significantly higher than the $52.5 billion planned for 2024, to support AI model development and data center construction [12]. - CEO Sundar Pichai emphasized that AI is driving tangible business results across the company [12]. Group 4: Amazon and Apple - Amazon is expected to report Q3 revenue of $177.9 billion, with an EPS of $1.57, amid a 4% stock price increase this year [14]. - Analysts predict strong growth for Amazon Web Services (AWS), potentially exceeding 20% growth by early 2026 [14]. - Amazon's advertising business is also expected to grow significantly, although a recent $2.5 billion settlement with the FTC may lower revenue guidance [15]. - Apple investors are focused on the sales performance of the iPhone 17, with expectations for Q4 iPhone sales revenue of $50.1 billion, an 8.5% year-over-year increase [15]. - Apple's total revenue is projected to reach $102.2 billion, with an EPS of $1.78, up from $1.64 a year ago [15].

Core Viewpoint - Apple and Amazon experienced stock declines of 1.5% and 2.5% respectively following the announcement of their quarterly earnings reports [2] Company Summary - Apple reported a 1.5% drop in stock price after its quarterly earnings announcement [2] - Amazon's stock fell by 2.5% in the after-hours trading following its earnings report [2]

Group 1: US-China Trade Relations - President Trump described his meeting with China's Xi Jinping as amazing, announcing a reduction of the fentanyl-related tariff from 20% to 10% as part of a trade reset [2][7] - The agreement includes China extending rare earth exports for another year and renewing soybean purchases, which is seen as beneficial for American farmers [8][11] - However, key issues such as semiconductors and TikTok were not addressed, indicating ongoing complexities in US-China relations [9][19] Group 2: Technology Earnings - Investors are reacting to earnings reports from major tech companies, with Alphabet shares rising over 7% after strong results, while Meta shares fell nearly 9% due to a one-time tax charge and heavy AI spending [10][30] - Microsoft reported a 26% year-over-year growth in its cloud business, but its capital expenditures surged by 74% to $35 billion, primarily for AI infrastructure [30][32] - OpenAI is preparing for a potential $1 trillion IPO, reflecting the ongoing AI boom and the company's restructuring into a for-profit public benefit corporation [33][34] Group 3: Federal Reserve Actions - The Federal Reserve cut interest rates by 25 basis points, but future cuts are uncertain as officials weigh inflation against a cooling job market [4][36] - Fed Chair Jerome Powell indicated that the policy is not on a preset course, and there are differing views on proceeding with further rate cuts [35][37] - The Fed's cautious approach reflects concerns about the labor market and supply-side issues, particularly immigration affecting worker availability [39][40] Group 4: Semiconductor Industry - Samsung Electronics reported a significant operating profit of approximately $4.9 billion in Q3, an 80% increase year-over-year, driven by strong demand for memory chips [47] - Nvidia reached a $5 trillion market cap, highlighting the growing importance of AI and data processing capabilities in the semiconductor sector [48][50] - The lack of discussion on Nvidia's Blackwell chips during the US-China meeting raises questions about future developments in the semiconductor industry [49]

Good morning! Moving to a new city is hard enough, let alone with a couple of young kids. But a stay-at-home mom told BI her children were the key to making friends in a Houston suburb. It's the final story in a BI series that followed three people for a year to understand the realities of relocating your life. You can also read about a woman who was paid to move from Los Angeles to Georgia and a couple who changed coasts when one of them got into Harvard.In today's big story, Amazon's massive layoffs have ...

Core Viewpoint - Apple and Amazon experienced stock declines of 1.5% and 2.5% respectively, following the announcement of their quarterly earnings reports [1] Company Summary - Apple reported a 1.5% drop in stock price after its quarterly earnings announcement [1] - Amazon's stock fell by 2.5% in the after-hours trading following its earnings report [1]