Apple (AAPL) CEO Tim Cook and company will take center stage on Thursday when the company reports its first quarter earnings results. The Street is looking for a strong showing on the strength of Apple’s iPhone 17 sales and Services segment. During Apple’s fourth quarter earnings call, Cook said the company anticipates first quarter revenue to be the “best-ever for the company and the best ever for iPhone.” That’s set some big expectations for the company’s results. But there’s more going on in Apple Wo ...

Group 1 - Alphabet Inc. (NASDAQ:GOOGL) is considered a strong buy growth stock by hedge funds, with RBC Capital reiterating a Buy rating and setting a price target of $375, while BofA raised its price target to $370 from $335 [1] - A multi-year collaboration between Alphabet Inc. and Apple was announced, where Apple's next generation Foundation Models will utilize Google's Gemini models and cloud technology, enhancing Apple's AI capabilities [2] - The partnership with Walmart aims to integrate Walmart's inventory into the Gemini app using Google's Universal Shopping Protocol, which BofA believes supports a higher valuation for Alphabet due to the traction of its Gemini capabilities [3] Group 2 - Alphabet Inc. operates through segments including Google Services, Google Cloud, and Other Bets, with Google Services encompassing products like Android, Google Maps, Google Play, Chrome, Search, and YouTube [4]

Core Viewpoint - Apple Inc.'s decision to outsource its AI foundation to Google is seen as a sign of significant trouble for the company, rather than a strategic advantage [1][2]. Financial Dynamics - Apple is now required to pay Google approximately $1 billion annually for AI services, reversing a previous arrangement where Google paid Apple around $20 billion per year to be the default search engine on iOS, resulting in a net loss of $21 billion for Apple [3]. Product Culture and Innovation - The partnership highlights Apple's decline in innovation and product curation, with the company lacking the internal talent to develop its own AI models [3][4]. - Current AI features from Apple have received poor user feedback, with many users disabling them due to unwanted actions [4]. Strategic Perspective - The partnership is viewed as a defensive strategy by both Apple and Google to maintain their market positions against new entrants like OpenAI, indicating a preference for established relationships over potential disruptors [5]. - While the deal may prevent immediate obsolescence for Apple, it underscores the company's loss of its status as an innovation leader [6]. Stock Performance - Apple's shares have decreased by 4.38% in 2026, although they have increased by 24.61% over the last six months and 11.44% over the past year, indicating a stronger medium to long-term price trend despite short-term weaknesses [7].

Core Viewpoint - Positive developments for major technology stocks are emerging early in 2026, benefiting investors in tech-focused ETFs like Invesco QQQ Trust (QQQ) and Invesco NASDAQ 100 ETF (QQQM) [1] Group 1: Company Developments - Nvidia (NVDA) received significant praise at the Consumer Electronics Show (CES), being the largest holding in QQQ and QQQM [2] - Apple (AAPL) and Alphabet (GOOGL) announced a partnership where Apple Foundation Models will utilize Google's Gemini models and cloud technology, enhancing user experiences while maintaining privacy standards [2] - Alphabet's market capitalization surpassed $4 trillion for the first time, making it the fourth U.S. company to achieve this milestone, joining Apple, Microsoft, and Nvidia [3] Group 2: Analyst Insights - Goldman Sachs reiterated a "buy" rating for Microsoft (MSFT) and raised its price target from $630 to $655, indicating a potential upside of approximately 35% [3] - Analyst Gabriela Borges noted that Microsoft's strategic investments are designed to create opportunities for significant upside while minimizing risks associated with specific vendors or approaches [4] - Palantir (PLTR) was upgraded by Citi from "neutral" to "buy," with a new price target of $235, up from $210, as it is seen as a beneficiary of AI expansion, particularly in defense and national security [4][5]

Group 1 - The AI frenzy is expected to continue dominating market headlines in 2026, with a focus on distinguishing real winners from pretenders [1] - Alphabet (GOOGL) and Apple (AAPL) have announced a multi-year collaboration to develop the next generation of Apple Foundation Models based on Google's Gemini models and cloud technology [2][3] - This partnership is seen as a significant development for Apple, which has faced criticism for lagging in the AI race, and aims to enhance user experiences while maintaining privacy standards [3][4] Group 2 - The performance disparity between AAPL and GOOGL has been notable, with GOOGL outperforming AAPL over the past year, partly due to differing excitement levels regarding their AI trajectories [5][8] - Analysts have revised EPS expectations positively for both companies, with GOOGL's EPS estimate increasing by 18% over the last year [6][10] - The collaboration is viewed as beneficial for both companies, with Apple securing its AI foundation and Google reinforcing Gemini's role in AI infrastructure [11]