Core Insights - The overall sentiment regarding major tech companies like Amazon, Meta, and Microsoft is positive, with substantial growth reported despite rising expenses [1][2][3] - Earnings estimates for the S&P 500 are increasing, driven by strong performance from these companies, which collectively represent 25% of the index [2] Amazon - Amazon is experiencing a significant acceleration in AWS growth, reaching its highest growth rate in years, with expectations of continued strong performance [4][8] - The company is projected to spend approximately $125 billion this year on capital expenditures, the highest among its peers [10] - AWS's backlog has reached $200 billion, reflecting a 22% increase, indicating strong future business prospects [13] Meta - Meta's advertising revenue increased by 26%, with impressions up 14% and price per ad rising by 10%, suggesting effective monetization strategies [11] - Despite the positive metrics, there are concerns about the company's ROI compared to its spending, leading to a more cautious outlook [9][12] Microsoft - Microsoft has been added to the investment portfolio, with a focus on growth opportunities, particularly in AI and capital expenditures [3] - The company is expected to see substantial capital expenditures, contributing to the longevity of its AI initiatives [4] Industry Trends - A shift in sentiment regarding generative AI investments is noted, with a Wharton study indicating that 74% of enterprises investing in generative AI are seeing returns, contrasting with previous findings [6][7] - The overall capital expenditure from major tech companies is projected to reach around $400 billion this year, increasing to nearly $600 billion next year and $700 billion the following year, providing a strong tailwind for growth [4]

Financial Performance - Meta Platforms reported adjusted earnings of $7.25 per share on revenue of $51.24 billion, exceeding consensus estimates [2] - Revenue in Q3 2025 rose 26% year-over-year, marking the company's strongest growth rate in 18 months [2] - The company absorbed a one-time tax charge of $15.93 billion related to recent tax legislation, which will reduce future cash tax payments [2] Capital Expenditure and Investment Strategy - Meta projected capital spending to range between $70 billion and $72 billion in 2025, above the previous midpoint guidance of $69 billion [4] - CEO Mark Zuckerberg defended the aggressive investment strategy, stating the need to build capacity ahead of potential breakthroughs in superintelligence [4] - Meta's recent investments include $14.3 billion in AI startup Scale AI and multiple cloud deals to enhance AI capabilities [5] AI and Reality Labs Division - The Reality Labs division reported a $4.4 billion operating loss on $470 million in sales during the quarter, with cumulative losses exceeding $70 billion since late 2020 [6] - Despite losses, the Ray-Ban AI glasses are gaining traction, with the $799 display version selling out quickly [6] - Zuckerberg outlined an ambitious vision for establishing Meta as a leading frontier AI laboratory, serving 3.5 billion daily active users across its family of apps [8]

Core Insights - The social-media platform is benefiting from its globalization efforts, indicating a successful strategy in expanding its international presence [1] Group 1 - The company has significant potential for further international growth, suggesting that there are still untapped markets available [1]

Core Insights - Reddit shares increased by over 12% following the release of third-quarter results that surpassed Wall Street expectations and provided a positive outlook for the current quarter [1] Financial Performance - The third-quarter results exceeded Wall Street estimates, indicating strong financial performance [1] - The company provided an optimistic outlook for the upcoming quarter, suggesting continued growth [1]

Core Insights - Amazon shares surged to a record high following better-than-expected earnings, contributing to the rise of major U.S. equity indexes including the Dow, S&P 500, and Nasdaq [1][5] Company Performance - Amazon was a top performer in the S&P 500, leading gains in both the Dow and Nasdaq, with significant growth attributed to its Amazon Web Services segment [2] - Reddit's shares increased sharply after reporting quarterly earnings that exceeded analysts' expectations, driven by a rise in user numbers, particularly internationally [2] - Western Digital experienced a boost in its stock price due to strong demand for data storage hardware supporting artificial intelligence, resulting in better-than-expected quarterly results [3] Market Reactions - Newell Brands saw its shares decline after lowering its full-year outlook, which was partially influenced by tariffs [3][5] - Dexcom's shares fell amid concerns regarding its future outlook and the accuracy of its G7 glucose monitoring system [4]

Core Insights - Reddit shares surged approximately 40% in 2025, with a notable 18% increase following the release of better-than-expected earnings and an optimistic outlook [1][5] Financial Performance - Reddit reported third-quarter earnings per share of $0.80, significantly surpassing the consensus estimate from analysts [2] - Revenue increased by 68% year-over-year, reaching $585 million, also exceeding expectations [2] User Growth - Daily active unique users (DAUqs) rose by 19% to 116 million, with international users increasing by 31% to 64.4 million, particularly strong in France, Brazil, and India [3] - U.S. DAUq grew by 7% to 51.6 million [3] Strategic Focus - CEO Steve Huffman highlighted progress in core product development, search capabilities, and internationalization during the earnings call [4] - Huffman identified search as a significant opportunity, noting that over 75 million users utilized Reddit for internet searches during the period, with this number on the rise [4]

Core Viewpoint - Meta Platforms experienced a significant drop in share price, over 11% in a single day, due to concerns over high AI spending and a rare earnings miss [1][2] Financial Performance - The third quarter results appeared negative on the surface, primarily due to a one-time $16 billion tax charge and ongoing cash burn from the Reality Labs division [3][4] - When excluding the tax charge, the financial numbers were robust, indicating that higher expenses impacted margins but did not fundamentally weaken the company's position [5] AI Investment Strategy - Meta's aggressive investment in AI is seen as a strategic move to capitalize on the AI revolution, with expectations to monetize innovations sooner than competitors [6] - The current market sentiment may be influenced by fears of an "AI bubble," but the company's long-term strategy is viewed as sound [2][6] Market Sentiment and Valuation - The recent decline in share price is considered overblown and unwarranted, suggesting a potential buying opportunity for investors [6] - Meta's shares are trading at approximately 26 times forward price-to-earnings (P/E), which may mitigate the impact of any potential AI bubble on its valuation [7]

Core Insights - Reddit's stock increased by over 18% following the announcement of strong third-quarter results and positive advertising growth [1] Financial Performance - Reddit's revenues rose 68% year-over-year to $585 million, exceeding the LSEG estimate of $546 million [2] - Earnings per share reached 80 cents, surpassing the expected 51 cents [2] - The company provided an optimistic sales outlook for Q4, projecting revenues between $655 million and $665 million, above the Wall Street forecast of $638 million [2] Growth Potential - Analyst Brian Nowak from Morgan Stanley noted that the results indicate continued progress in Reddit's advertising and platform initiatives [3] - Active advertisers increased by 75% year-over-year in Q3, suggesting significant growth potential [3] - Nine of Reddit's top 15 advertiser verticals experienced growth of over 50%, highlighting strong demand [3] - Ongoing investments in automation are enhancing return on advertising spending, further supporting growth [3]

Core Insights - Reddit (RDDT.US) shares surged nearly 19%, closing at $230.92, following the release of its third-quarter earnings report which significantly exceeded expectations [1] Financial Performance - Revenue for the third quarter increased by 68% year-over-year, reaching $585 million, while earnings per share (EPS) stood at $0.80, surpassing the target of $0.51 [1] - Net profit amounted to $163 million, up from $133 million in the same period last year, reflecting a 23% increase [1] Future Guidance - The company raised its fourth-quarter performance expectations, forecasting revenue between $655 million and $665 million, well above Wall Street's prior estimate of $638 million [1] - Adjusted earnings expectations for the fourth quarter are set between $275 million and $285 million, exceeding the previous forecast of $259 million [1]

Skip to content S&P 500 6,860.80 -0.13% Dow Jones 47,570.20 -0.11% Nasdaq 100 25,991.20 -0.16% Russell 2000 2,475.91 +0.52% FTSE 100 9,716.00 -0.52% Nikkei 225 52,423.70 +1.58% Stock Market Live October 31: S&P 500 (SPY) Soaring on Amazon and Apple Earnings Home >Investing >Opinion: Meta Stock's Post-Earnings Plunge is a Golden Opportunity to Buy Investing Opinion: Meta Stock's Post-Earnings Plunge is a Golden Opportunity to Buy ByJoey Frenette Oct 31, 2025 10:31 am This post may contain links from our spon ...