- Microsoft, Meta smash quarterly expectations
- AI continues to power growth
- Pair added nearly $500 billion to their combined market caps
AI continues to power earnings of major US techs firms but blowout earnings from Microsoft (MSFT:NASDAQ) and Meta Platforms (META:NASDAQ) overnight will really have supporters crowing.
Microsoft stock jumped more than 8% in after-hours trading, Meta did even better, surging 11.5% after smashing expectations, between them adding nearly half a trillion dollars to their combined market caps.
Satya Nadella, Microsoft CEO, said Azure cloud computing growth was fuelled by ‘demand across every industry and sector’ as companies increasingly adopt AI-driven tools.
‘This was a slam-dunk quarter for Microsoft with cloud and AI driving significant business transformation across every sector and industry’, Wedbush analyst Daniel Ives said.
MAGNIFICENT SEVEN TO FAMOUS FIVE
‘It’s time to bid farewell to the Magnificent Seven banner’, wrote Daniel Coatsworth of AJ Bell and you can see why. Share prices of both Apple (AAPL:NASDAQ) and Tesla (TSLA:NASDAQ) have suffered double-digit declines this year, and while Amazon (AMZN:NASDAQ) and Alphabet (GOOG:NASDAQ) have both lagged the S&P 500, its leaves the iPhone and EV firms out on a limb.
‘Their underperformance has persisted, which means the Mag7 name is no longer relevant - these stocks are no longer driving the market, so the banner needs refreshing’, wrote Coatsworth.
‘We’re now in the new era of the Famous Five, with Meta and Microsoft doing their best to dethrone Nvidia (NVDA:NASDAQ) as the ones delivering the most excitement,’ the sort of thrills kids used to get from reading those Enid Blyton books.
DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The author of this article (Steven Frazer) and the editor (James Crux) own shares in AJ Bell.
