Big Tech companies including Meta, Microsoft, Alphabet, Apple, and Amazon all reported their quarterly earnings this past week. We speak to Wall Street insiders to analyze the results, key themes for investors including Ai capex spending, the outlook for growth, and opportunities for investors. For more of the latest Big Tech news, please visit: https://finance.yahoo.com/ #youtube #Meta #Amazon #Microsoft #Google #Alphabet #Apple About Yahoo Finance: Yahoo Finance provides free stock ticker data, up-to-date ...

Group 1: Tech Earnings Overview - The earnings season has shown a year-over-year increase of approximately 10% for S&P 500 earnings, with the tech sector experiencing a 20% rise [2] - Meta was the only major tech company that did not receive a positive reception during earnings reports, contrasting with the overall strong performance of other tech firms [1][2] - The tech sector's strong performance is expected to sustain the equity market rally, particularly as investors look to include major tech names in their portfolios [2] Group 2: Sector Rotation and Investment Opportunities - Many sectors are positioned for catch-up as they appear undervalued relative to the tech sector, which has driven up overall market valuations [3][4] - There are opportunities in cyclical and value sectors, particularly in quality dividend growth stocks that have lagged behind in the recent rally [5] - The net debt to EBITDA ratio for the S&P 500 is at an all-time low of 1.5 times, indicating high-quality large-cap stocks and potential for broad market rotation [6] Group 3: Federal Reserve and Interest Rates - The Federal Reserve's recent comments suggest that further cuts to interest rates will be challenging until inflation approaches 2% [7][8] - The current neutral position of the Fed indicates that the market may not face significant headwinds or tailwinds from interest rate changes in the near term [10][12] - The long-term interest rates are expected to remain stable, influencing large-cap stock valuations more than short-term rate changes [10][11] Group 4: Trade and Tariff Impacts - The recent de-escalation of trade tensions between the U.S. and China is viewed positively, but the long-term impacts of tariffs on inflation and GDP remain uncertain [14][16] - The economic principle of supply and demand suggests that tariffs could lead to a slight decrease in GDP if they remain high [15] Group 5: Company-Specific Insights - Apple's recent earnings report showed a revenue of $49.03 billion, slightly below expectations, but strong demand for the iPhone is anticipated heading into the holiday season [18][72] - Amazon's AWS segment reported a 20% growth, which is crucial for its overall performance, and the company is focusing on expanding its grocery business to compete with Walmart [25][36][52] - Meta's strategy of prioritizing AI infrastructure over immediate returns has led to a significant drop in its stock price, reflecting investor concerns about its long-term growth strategy [90][92]

For more on the big takeaways from Mega Cap tech earnings, let's bring in Madrona managing director Matt Mwane. Matt, good to see you. We got a we got an overall look that we can show you of this tech earnings and the AI story.Uh looking at the the capex that's out there and the degree to which they're going to be able to to prove that it's worth it, at least what they've shown so far. So, we'll put that up in a moment. There it is.It's uh it's up on the wall. What was your impression of meta earnings in pa ...

Five tech titans just sent a clear message to Wall Street: The artificial intelligence megatrend remains strong. All that talk about an AI bubble bursting and AI stocks crashing should be set aside – at least for now. Meta Platforms (META), Microsoft (MSFT), Google parent Alphabet (GOOGL), Amazon (AMZN) and Apple (AAPL) all posted solid results this past week. All signaled that they plan to step up already-massive bets on the artificial intelligence megatrend. The Facebook parent's big spender talk did spoo ...

Core Insights - November is traditionally a strong month for the stock market, and the artificial intelligence (AI) sector is projected to grow rapidly, reaching a market size of US$1.68 trillion by 2031, with a CAGR of 36.89% from this year [1] Group 1: AI Sector Growth - The AI sector is experiencing significant growth, making it a focal point for investors looking for opportunities in AI-driven stocks [1] - Companies like QUALCOMM, Microsoft, and Meta Platforms are highlighted as momentum picks for November, benefiting from the sector's growth [2][9] Group 2: Driehaus Investment Strategy - The Driehaus strategy, known as "buy high and sell higher," emphasizes investing in stocks that are increasing in price rather than those in decline [3] - Key criteria for this strategy include strong earnings growth rates, impressive earnings projections, and a history of beating estimates [5] Group 3: Screening Parameters - Stocks are screened based on Zacks Rank (1-3) and Momentum Score (A or B), which have shown to provide the best upside potential [6][7] - Specific parameters include last 5-year average EPS growth rates above 2%, trailing 12-month EPS growth greater than 0, and positive percentage change in the 50-day moving average [8][10] Group 4: Selected Stocks - QUALCOMM (QCOM) has a Zacks Rank of 3 and a Momentum Score of A, with an average trailing four-quarter earnings surprise of 6.2% [10] - Microsoft (MSFT) holds a Zacks Rank of 3 and a Momentum Score of B, with an average trailing four-quarter earnings surprise of 8.5% [11] - Meta Platforms (META) has a Zacks Rank of 2 and a Momentum Score of B, with an average trailing four-quarter earnings surprise of 18.9% [12]

Core Insights - Five major tech firms, referred to as the "Magnificent Seven," reported their earnings, marking a significant moment for the economic outlook of 2025 [1] Company Earnings - Apple (AAPL), Amazon (AMZN), Microsoft (MSFT), Google (GOOGL), and Meta (META) provided earnings reports that shed light on their performance during the ongoing AI revolution [1]

Core Insights - Microsoft (MSFT) shares dropped nearly 3% to $525.97 due to new earnings and litigation news, but analysts view this as a buying opportunity during market downturns [1] - The company is solidifying its leadership in cloud technology and artificial intelligence, with several firms raising price targets following increased Azure adoption and initial success of AI Foundry technology [1] Company Performance - Microsoft reported an 18% revenue growth to $77.7 billion in the fiscal first quarter of 2026, with operating income growth of 24% to $38 billion [7] - The company achieved a GAAP EPS of $3.72, a 13% increase, while non-GAAP EPS rose 23% to $4.13 [7] - Microsoft has a forward price/earnings ratio of 35.2 and a price/sales ratio of 14.3, which are relatively high compared to the S&P 500 technology industry average of 26x [5] Market Position - Microsoft is the largest software firm globally, with a market capitalization of $3.89 trillion, and operates in cloud computing, productivity software, and AI technology [3] - The company has a strong balance sheet, a profit margin of 36%, and a return on equity of 32%, reinforcing market confidence as it approaches 2026 [2] - Over the past 52 weeks, MSFT's stock has ranged from $344.79 to $555.45, reflecting a 23% growth year-to-date, outperforming the S&P 500's 16% growth [4]

Core Insights - The current phase of growth in the tech industry is characterized by significant capital expenditures (capex) driven by the AI arms race, with major players like Microsoft, Amazon, Alphabet, and Meta heavily investing in infrastructure to support AI and cloud services [1][5][27] - The competition among Big Tech firms has shifted from abstract growth metrics to tangible infrastructure investments, with a focus on power, capacity, and physical assets [3][7][20] Company Summaries - **Alphabet**: Increased its projected 2025 capex to $91–93 billion, focusing on servers and networking gear, with analysts noting that its ad revenue growth supports this infrastructure investment [2][13] - **Microsoft**: Reported record revenue of $77.7 billion for the quarter, up 18%, with a backlog of $392 billion, showcasing its operational efficiency and strong demand for Azure services, which grew approximately 40% year over year [12][18][17] - **Amazon**: Achieved a 20% growth in AWS revenue, reaching $33 billion, and emphasized its strategy of acquiring energy contracts to support its infrastructure needs, which contributed to a 10% increase in its stock price post-earnings [6][19][14] - **Meta**: Announced plans to spend $70–72 billion in 2025, despite lacking a rentable cloud, indicating a commitment to infrastructure investment to catch up with competitors [4][27] - **Apple**: Continued to show strong performance in its services segment, with revenue climbing 15% to $28.8 billion, maintaining high margins even as hardware sales softened [25][27] Industry Trends - The cloud and AI sectors are converging, with companies now competing for control over infrastructure rather than just software capabilities, marking a shift in how dominance is measured in the tech industry [7][20] - The ad economy remains a crucial funding source for infrastructure investments, with significant revenue growth reported by Meta and Alphabet, indicating that traditional revenue streams are still vital for supporting new capital expenditures [22][21] - The competitive landscape among Microsoft, Amazon, and Alphabet is intensifying, with each company demonstrating strong growth and infrastructure commitments, leading to a more complex and competitive environment [16][19][27]

Core Insights - The rise of artificial intelligence has created significant profit opportunities, with Nvidia being a major beneficiary due to its graphics chips powering various AI applications [1] - Wall Street is beginning to question whether Nvidia's growth potential is already reflected in its stock price, leading to a shift in investor focus towards companies that can generate recurring revenue from AI rather than relying solely on hardware sales [2] Company Analysis - **Nvidia (NASDAQ:NVDA)**: Nvidia has been a leader in the AI space, but its margins and scale are seen as being priced for perfection. The demand for compute power remains high, but the market may be shifting towards companies that provide AI integration rather than just hardware [2][3] - **AMD (NASDAQ:AMD)**: AMD is positioning itself for the "AI efficiency" phase, with its MI300 chip offering a 2x performance-per-watt advantage. This could be pivotal as inference workloads become more critical. AMD is viewed positively by industry experts, with potential for significant growth in the cloud sector by 2026 [5][6] - **Microsoft (NASDAQ:MSFT)**: Microsoft is rapidly monetizing its AI integrations across various platforms, contributing an estimated $10 billion in incremental revenue for FY2025. The company is making substantial infrastructure investments to enhance its compute capabilities, although it is still in the early stages of realizing its AI potential [7][9][11] - **Taiwan Semiconductor Manufacturing Company (NYSE:TSM)**: TSMC is crucial for the AI ecosystem as it manufactures chips for major players like Nvidia and AMD. The company's move to increase manufacturing in the U.S. helps mitigate geopolitical risks [10] Future Trends - The next wave of AI winners may not be traditional chipmakers but rather companies that excel in AI integration and infrastructure. As gross margins stabilize, investors are likely to favor firms that enhance productivity rather than those that burn capital [3][11]

Core Viewpoint - The artificial intelligence megatrend remains robust, with major tech companies signaling strong ongoing investments despite concerns about an AI bubble [1][2][30]. Group 1: Earnings Reports and Capital Expenditures - Major tech companies including Meta, Microsoft, Google, Amazon, and Apple reported solid earnings, with significant capital expenditures aimed at AI infrastructure [2][5][6]. - Google reported capital expenditures of $24 billion, up 83% year-over-year, while Microsoft spent $35 billion, a 74% increase [7]. - Meta's capital expenditures reached $19.4 billion, more than double the previous year's spending, and it expects even larger expenditures in 2026 [7][16]. Group 2: AI Ecosystem and Market Impact - The AI ecosystem is becoming a significant part of the stock market, with major players like Microsoft, Meta, Google, and Amazon collectively accounting for over $11.5 trillion in market capitalization [11]. - The construction of AI-capable data centers is projected to require $5.2 trillion in capital expenditures, indicating a substantial economic impact [10]. - Microsoft plans to increase its AI capacity by over 80% this year and double its data center footprint in the next two years [12]. Group 3: Company-Specific Developments - Meta's aggressive spending plans for AI have raised concerns among investors, leading to a significant drop in its stock price following its earnings report [15][16]. - Amazon's AWS reported revenue of $33 billion, a 20.2% increase year-over-year, alleviating concerns about its market position [19][20]. - Nvidia is projected to generate over $300 billion in data center revenue next year, reflecting strong demand in the AI sector [22]. Group 4: Industry Trends and Future Outlook - The ongoing debate about an AI bubble continues, with some analysts expressing concerns about the sustainability of high capital expenditures without immediate returns [30][28]. - Despite concerns, many analysts remain optimistic about the long-term potential of AI investments, viewing them as a catalyst for the next industrial revolution [32].