Back in June 2024, researcher Leopold Aschenbrenner left OpenAI’s superalignment team and predicted that Alphabet (NASDAQ:GOOGL | GOOGL Price Prediction) stock would “explode.” Two years later, that call has aged remarkably well. The stock has done exactly what he said it would, and the underlying business matches the picture he sketched.”I care about it once you get the AI beta. Right. And so at some point Google will get $100 billion of revenue from A.I. probably their stock will explode.”
The Stock Did Explode When Aschenbrenner recorded that episode, Alphabet was trading at $173.81. As of Friday’s close, shares sit at $359.68, a 107% gain from the day his episode aired. The one-year return alone is 105%. I have owned Alphabet since April 2012, and the last 24 months have been the most validating stretch I can remember for the AI thesis.
Aschenbrenner’s framing was straightforward: the market would care about Google’s AI work the moment it showed up in the revenue line. That moment has arrived.
Cloud Is Where the $100 Billion Thesis Lives Google does not break out an “AI revenue” line, but Google Cloud is the closest proxy. In Q1 FY2026, reported April 29, 2026, Cloud revenue hit $20.03 billion, up 63% year over year, with backlog nearly doubling quarter on quarter to over $460 billion. That backlog number is contracted future revenue, much of it tied to AI infrastructure and Gemini workloads.
The Cloud growth curve is bending the right way: 32% in Q2 2025, 34% in Q3, 48% in Q4, 63% in Q1 2026. CEO Sundar Pichai said on the last call: “Our AI investments and full stack approach are lighting up every part of the business.” You can read the full release in the company’s Q1 2026 8-K filing with the SEC.
Gemini Is Scaling Like a Real Product The consumer and developer side matters too. The Gemini App crossed 750 million monthly active users by Q4 2025. API usage hit 16 billion tokens per minute, up 60% from the prior quarter. Gemini Enterprise paid monthly active users grew 40% quarter over quarter. Search revenue, which many feared would get gutted by chatbots, accelerated to 19% growth as AI Overviews and AI Mode rolled out globally.
For full-year 2025, Alphabet crossed $400 billion in annual revenue for the first time, finishing at $402.84 billion.
The Bear Case The cost of becoming the AI infrastructure layer is enormous. Capex more than doubled in Q1 2026 to $35.67 billion, up 107% year over year. Management guided 2026 full-year capex of $175 to $185 billion. Free cash flow in Q1 fell 47% year over year. Other Bets losses widened. Insider activity recently shows net selling across 160 transactions.
Prediction markets reflect the tension. Polymarket traders give a 0.34 probability that GOOGL hits $340 in June 2026 and only a 0.049 probability that Google is first to put an AI model at 1550 on Chatbot Arena this year. The crowd is not pricing in another explosion from here.
What I Am Watching Now Aschenbrenner’s prediction has largely played out on revenue and share price. The forward question is whether the capex cycle pays back. Alphabet trades at a forward P/E of 26, with 57 buy or strong buy ratings against 7 holds and zero sells, and an analyst target of $432.83.
If you believe the Cloud backlog converts to revenue and Gemini keeps compounding API usage, the second leg of the explode call is still ahead. If capex outruns monetization, the next year tests that thesis. Either way, the researcher who walked out of an AI lab in 2024 to bet on the incumbents looks a lot smarter today than he did then.
Had you invested $1,000 in the Berkshire Hathaway (BRKA +0.05%)(BRKB 0.11%) holding company when Warren Buffett became chief executive in 1965, it would have turned into a staggering $48 million by the time he stepped down at the end of 2025. The same investment in the S&P 500 index would have grown to just $399,700 over the same period.
Berkshire owns numerous subsidiaries, a $337 billion portfolio of publicly traded stocks, and a massive $397 billion pile of cash. Buffett's chosen successor, Greg Abel, took over as CEO at the start of 2026, and he has plenty of resources at his disposal to extend the conglomerate's incredible run of market-beating returns.
Abel is already swinging for the fences, having acquired around 65 million shares in Google parent Alphabet (GOOG +1.09%)(GOOGL +1.10%) since the start of the year, worth roughly $21.6 billion (by my estimate). He has effectively more than quadrupled Berkshire's position, and here's why it might be a winning move over the long term.
Image source: The Motley Fool.
Artificial intelligence is transforming Google Search Artificial intelligence (AI) chatbots offer a fast and convenient way to find information online, so investors were initially worried they would pose a threat to traditional internet search engines like Google Search. But Alphabet developed a series of new AI-powered features to create the ultimate hybrid search experience, and the company says they are driving growth in the platform overall.
AI Overviews combine text, images, and links to third-party sources to provide an AI-generated answer when users type a query into Google Search. These responses appear above the traditional search results, saving users from sifting through web pages to find answers. Then there is AI Mode, which opens a chatbot-style interface where users can expand on their original query by asking additional questions.
When users enter more queries into Google Search, they see more ads, and Alphabet makes more money. As a result, the platform generated a record $60.4 billion in revenue during the first quarter of 2026, which was a 19% increase from the year-ago period. It was the fourth straight quarter of accelerating growth, so AI appears to be fueling significant momentum.
Google Cloud is producing explosive growth Google Cloud offers businesses all the necessary tools to develop and deploy AI software, from computing capacity to ready-made AI models. Its centralized data centers are fitted with thousands of graphics processing units (GPUs) from top suppliers like Nvidia, but to provide customers with some variety, it also designed its own chips called Tensor Processing Units (TPUs).
Google Cloud recently unveiled its eighth-generation TPUs, the most powerful yet. The 8t delivers three times as much performance in AI training workloads compared to the previous generation, while the 8i provides an 80% improvement in performance-per-dollar in inference workloads. These TPUs are so good that some AI customers are actually buying them for their own data centers, creating an entirely new revenue stream for Alphabet.
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Google Cloud generated a record $20 billion in total revenue during the first quarter, which was a blistering 63% increase from the year-ago period. It grew much faster than cloud competitors like Amazon Web Services and Microsoft Azure, which saw revenue increases of 28% and 40%, respectively, in their most recent quarters.
But even faster growth could be around the corner for Google Cloud, because its order backlog nearly doubled sequentially to $462 billion during the first quarter, as customers line up around the block for more computing capacity.
Alphabet stock is still cheap Even though Alphabet stock doubled over the last 12 months, its price-to-earnings (P/E) ratio is just 27.4. That is a notable discount to the Nasdaq-100 index, which trades at a P/E ratio of 34.6, suggesting Alphabet might still be undervalued compared to a basket of its big-tech peers.
Warren Buffett is a textbook value investor. He targeted companies he perceived as cheap, as long as they generated steady growth and reliable earnings, and had strong management. He was never afraid to be aggressive when he found an opportunity he liked; he put a whopping $38 billion into Apple between 2016 and 2023, and it paid off spectacularly because the position was worth north of $170 billion in early 2024.
Greg Abel worked with Buffett at Berkshire for over two decades before taking on the CEO role, so it's no surprise he's following in his predecessor's footsteps with the big investment in Alphabet. This probably won't be his last bold move, given Berkshire's enormous cash pile.
Google on Tuesday released the final version of its Android 17 operating system, as well as its counterpart for smartwatches, Wear OS 7. The latest release, which arrives first on its own Pixel devices, is also accompanied by a Pixel Drop, bringing new features that include support for the latest AI models, like the music-generation model Lyria 3, the multimodal Gemini Omni, and speech-to-translation tools for the Pixel 10a with AudioLM.
The latest feature release underscores Google’s strategy of using its Android and Pixel devices to showcase its latest AI technology. While its rival Apple is focused on catching up in AI with September’s public launch of AI upgrades to Siri and iOS 27, Google’s Android 17 is focused on its newest AI models, Gemini’s role in creation, communication, and other device experiences.
In today’s Pixel Drop, Android Quick Share’s file-sharing feature will become compatible with Apple’s AirDrop on older Pixel 8a and 9a devices. Plus, Gemini Omni will now let you edit videos in a conversation, while Lyria 3 lets users create music tracks with text prompts and/or images in the Gemini app. Pixel 10a devices will also get better speech-to-speech translation tools with AudioLM.
Image Credits:Google Other phone features are arriving, too, such as the ability to record a personalized outgoing audio message for callers when you can’t answer. Plus, the “Take a Message” feature will arrive in more global markets.
The Pixel Drop brings emergency detection features to the Google Pixel Watch as well, meaning that if the watch detects a car crash, fall, or lack of pulse, it will automatically contact emergency services and your selected emergency contacts.
Beyond AI, Android 17’s larger update allows users to take advantage of features like a “bubble bar,” which is a new user interface element that lets you organize, move, and then quickly access recent apps that appear as bubbles at the bottom of your screen. The feature is designed to help speed up app interactions and aid in multi-app workflows.
Image Credits:Google (Bubbles UI) Social media users may like Android 17’s new feature that lets them record themselves with the selfie camera and phone screen simultaneously for screen reaction videos that can be shared on platforms like TikTok, YouTube, Instagram, and others.
Image Credits:Google Parental controls and security features were also improved in this latest release, adding a “Mark as Lost” feature in Find Hub, Live Threat Detection, and other threat defenses, alongside screen time limits and content-filtering tools that can now be set with a PIN without linking a Google account.
A new foldable gaming mode offers a 50/50 layout with a dynamic game pad.
Image Credits:Google Meanwhile, watch owners can now receive live updates from phone apps that mirror to the Pixel Watch. Smartwatches will also work better with Google’s upcoming AI glasses and other hardware, such as headphones.
This summer, Wear OS will introduce more Gemini Intelligence features, like tools for making personalized widgets just by describing them, and it will be able to offer “Personal Intelligence” by connecting your Google apps and chat history with Gemini.
Image Credits:Google Battery life improvements — up to 10%, Google claims — as well as multistep automation will also arrive in the new Wear OS.
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Sarah has worked as a reporter for TechCrunch since August 2011. She joined the company after having previously spent over three years at ReadWriteWeb. Prior to her work as a reporter, Sarah worked in I.T. across a number of industries, including banking, retail and software.
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Two HSBC bank logos are displayed on an office building in Mexico City, Mexico, July 25, 2025. REUTERS/Henry Romero/File Photo Purchase Licensing Rights, opens new tab
LONDON, June 17 (Reuters) - HSBC (HSBA.L), opens new tab on Wednesday announced a multi-year partnership with Alphabet Inc-owned Google Cloud (GOOGL.O), opens new tab focused on building the British bank's artificial intelligence capabilities.
The tie-up marks the latest step in HSBC CEO Georges Elhedery's drive to embrace the revenue-generating and cost-savings power of AI which can process vast amounts of data, automating tasks previously done by people.
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The partnership, which HSBC said will focus on areas such as advice for wealth management clients and financial crime risk management, shows how banks worldwide are accelerating their adoption of AI as they compete in a technology arms race with each other.
HSBC says partnership with Google cloud should enable 200 more tasks using AI over the next two years.
Announcement comes after Elhedery in May urged staff to embrace AI; warned the technology will "destroy certain jobs and create new jobs."
Bank says Google Cloud and Google DeepMind engineering teams will help it identify priority projects that could each deliver more than $100 million in revenue gains or efficiency improvements.
HSBC will access Google's Gemini model; bank is already running 600 applications on Google Cloud.
Project will target three main areas: personalised wealth management support; financial crime risk management; and AI-empowered decision making for frontline staff to reduce time spent on administration and meeting preparation.
"A partnership like this one with Google Cloud helps us empower our colleagues with the tools they need to be future-ready, and supports our work in building a simple, agile, faster, and more personal HSBC,” CEO Elhedery said.
Reporting by Lawrence White; Editing by Susan Fenton
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Chiefs of the world's leading AI companies are descending on the G7 conference in France Wednesday, in a sign of their growing geopolitical influence as artificial intelligence rises to the top of the global agenda.
CEOs including OpenAI's Sam Altman, Anthropic's Dario Amodei, Google DeepMind's Demis Hassabis, alongside around a dozen other tech leaders, will take part in a lunch meeting at the summit in Evian on Wednesday.
Frontier AI risks, infrastructure and sovereignty are all expected to be discussed at the conference. The protection of children online will also be a key part of the discussions, The Élysée Palace, the official residence of the president of France in Paris, said in a press briefing on Thursday.
Other tech chiefs including France-based Mistral's Arthur Mensch, Canada's Cohere CEO Aidan Gomez, Italian company Domyn's Uljan Sharka, U.K. AI scaleup Synthesia's Victor Riparbelli and German-based Black Forest Labs' Robin Rombach will also be present at the lunch. Salesforce's Marc Benioff, Meta's Alex Wang, alongside the founders of Indian AI company Sarvam and Japan's Sakana are also pegged to attend.
"It just shows that in order to make credible commitments on AI, heads of state now need the cooperation, if not endorsement, of a handful of private sector executives actually building the technology," Jessica Brandt, senior fellow for technology and national security at the Council on Foreign Relations (CFR), told CNBC.
"We're seeing a shift in who gets a seat at the table and a signal of where power sits."
'Inflection point'The G7 summit — which features the U.S., U.K., Canada, France, Germany, Italy, Japan and the EU — comes as Anthropic remains locked in negotiations with the U.S. administration after Washington imposed export controls on the AI lab's Fable 5 and Mythos 5 models amid national security concerns.
Recent announcements of powerful AI models with advanced cyber capabilities, including Anthropic's Mythos and OpenAI's GPT-5.5 Cyber, have brought a wave of concerns from businesses and governments around digital security weaknesses.
The release of Mythos marked an "inflection point" in AI development, Cameron Kerry, a visiting fellow at the Brookings Institution, told CNBC, adding that it led the Trump administration to consider regulating the technology.
watch now
U.S. export controls on Anthropic's models have "changed everything," said Emerson Brooking, senior fellow at the Atlantic Council.
"Multiple G7 nations have previously alluded to the need for sovereign AI investment, but there was always an assumption that this would take place alongside access to the U.S. tech stack," he told CNBC. "Now the U.S. has indicated a willingness to cut off the G7 and even treaty allies from certain AI capabilities."
For tech bosses, a seat at the table during the G7 represents a key opportunity to influence policy debates at the highest level.
"It seems the firms expect to come away with a package of voluntary commitments — youth safety, frontier risk in cyber and bio — pledges that are likely to become the de facto global baseline," said Brandt.
Earlier this month, OpenAI told CNBC it was expecting a set of "voluntary commitments" to be reached by tech companies during the Summit.
"The frontier labs want to shape this debate before any binding rules exist," Brookings told CNBC.
ToplineElon Musk’s fortune swelled above $1.4 trillion on Tuesday as SpaceX shares extended a rally in their second full trading day, ranking Musk’s rocket maker ahead of Amazon as the world’s fifth-largest company by market value.
Shares of Elon Musk’s rocket maker have soared by more than 30% since their trading debut.
Getty Images
Key FactsShares of SpaceX rallied by just over 12% shortly after trading opened on Tuesday, raising its market value to about $2.8 trillion and ranking it ahead of Amazon ($2.6 trillion) as the fifth-largest company.
A further boost to SpaceX’s stock marks a nearly 35% rally since its IPO on Friday, when shares closed up 19%, and a 19.5% surge on Monday.
The latest increase in SpaceX shares added $119.1 to Musk’s net worth, valued at about $1.4 trillion, ranking him more than $1 trillion ahead of Google cofounder Larry Page ($300.7 billion), who Forbes ranks as the world’s second-richest person.
Musk holds 4.8 billion SpaceX shares, bringing his stake to about 38%, with an additional 350 million stock options with an exercise price of $8.40 per share.
what to watch forSpaceX may soon challenge Microsoft as the fourth-largest company, falling behind the software giant’s market value of $2.92 trillion. Apple is the next largest with a market capitalization of $4.3 trillion, followed by Alphabet at $4.4 trillion. Both trail Nvidia at $5 trillion.
ToplineElon Musk’s fortune swelled above $1.4 trillion on Tuesday as SpaceX shares extended a rally in their second full trading day, ranking Musk’s rocket maker ahead of Amazon as the world’s fifth-largest company by market value.
Shares of Elon Musk’s rocket maker have soared by more than 30% since their trading debut.
Getty Images
Key FactsShares of SpaceX rallied by just over 10% shortly after trading opened on Tuesday, raising its market value to about $2.77 trillion and ranking it ahead of Amazon ($2.6 trillion) as the fifth-largest company.
A further boost to SpaceX’s stock marks a nearly 35% rally since its IPO on Friday, when shares closed up 19%, and surged another 19.5% on Monday.
The latest increase in SpaceX shares added $119.1 billion to Musk’s net worth, which is now valued at about $1.4 trillion, ranking him more than $1 trillion ahead of Google cofounder Larry Page ($300.7 billion), who Forbes ranks as the world’s second-richest person.
Musk holds 4.8 billion SpaceX shares, bringing his stake to about 38%, with an additional 350 million stock options with an exercise price of $8.40 per share.
what to watch forSpaceX may soon challenge Microsoft as the fourth-largest company, falling behind the software giant’s market value of $2.92 trillion. Apple is the next largest with a market capitalization of $4.3 trillion, followed by Alphabet at $4.4 trillion. Both trail Nvidia at $5 trillion.
tangentSpaceX disclosed to the Securities and Exchange Commission on Monday that it would acquire the AI coding platform Cursor’s parent company, Anysphere, for $60 billion. SpaceX said it anticipated the deal closing by Q3 2026. Cursor and SpaceX announced a partnership in April, saying they would work together on “coding and knowledge work AI,” and SpaceX said at the time it reserved the right to pay Cursor $10 billion or outright buy the company for $60 billion.
key backgroundA meteoric rise in SpaceX shares follows its blockbuster stock debut last week, underpinned by record-setting investor demand that boosted its IPO to $85 billion. Musk has pitched his company hitting $1 trillion in revenue by 2030, a reversal from the $18.7 billion recorded in all of 2025, despite a net loss of $4.9 billion in the year and $4.28 billion through its latest quarter. Some analysts have disputed SpaceX’s market valuation, including “Big Short” investor Michael Burry, who has claimed there was “nothing” in SpaceX’s IPO paperwork that suggested the company was worth $1 trillion or even $2 trillion.
further readingForbesSpaceX Will Buy AI Coding Firm Cursor For $60 BillionBy Siladitya RayForbesSpaceX Soars Another 20%—Rocketing Musk’s Net Worth To $1.3 TrillionBy Ty Roush
Elon Musk’s SpaceX has overtaken Amazon as the world’s fifth-most valuable company days after its stock market debut.
The milestone came as it agreed to buy the startup behind the AI-powered coding app Cursor for $60bn (£44bn), in an attempt to capitalise on the technology’s success as a coding tool.
SpaceX is the parent of Musk’s AI business, xAI, which will be able to boost its capabilities in an area – AI systems writing code – that has proven to be a strong commercial success for Anthropic, the rival company behind the Claude chatbot.
The group also includes the SpaceX rocket company, social media platform X and the satellite maker and internet service provider Starlink, which is the only profitable part of the business.
The news of the Cursor acquisition was announced as SpaceX passed Amazon in market capitalisation, an important measure of value for a publicly listed company. SpaceX shares rose by 13% on opening on the Nasdaq index on Tuesday.
At one point, its valuation rose as high as $2.97tn, leaping over Amazon’s $2.65tn to become the world’s fifth most valuable company by market value. Its shares later eased back to about 5% up at the close and a valuation just ahead of the e-commerce company of $2.66tn.
SpaceX lost $4.9bn in 2025 on revenues of $18.7bn, while Amazon posted revenues of $717bn and net income – a US measure of profit – of $78bn.
SpaceX floated at $135 a share on Friday and its shares have risen by approximately 50% since. The float made Musk, SpaceX’s founder and chief executive, the world’s first trillionaire with a fortune of $1.1tn, according to Forbes. It reckons the 54-year-old is now worth $1.3tn.
The company had been circling Cursor, owned by the San Francisco-based Anysphere, for months. It said in April it had secured an option to either buy Cursor for $60bn later this year or pay $10bn for a partnership.
Hedge fund billionaire Bill Ackman said the strong value of SpaceX’s stock was another boon for the company because it would require fewer company shares to pull off large acquisitions such as Anysphere. Photograph: Kristoffer Tripplaar/AlamyHarrison Rolfes, an analyst at the financial research firm PitchBook, said the deal would not “close the gap” between xAI’s models and those developed by Anthropic and OpenAI. However, he said it made sense to gain access to Cursor’s more than 1 million users.
“Owning the tool that professional developers already trust daily is a faster path to enterprise AI revenue than winning the model race,” he said.
Anysphere is one of several Silicon Valley startups that have drawn waves of developers by using AI to automate coding, making it an important rival to market leaders Anthropic and OpenAI. But a lack of access to computing power – something SpaceX can offer as a datacentre owner – has hampered Cursor’s growth.
“Cursor does not have the scale of OpenAI or Anthropic, but it has built some very impressive coding models relative to cost. That makes this a positive move for SpaceX,” said Matt Britzman, a senior equity analyst at Hargreaves Lansdown.
In its filing for an initial public offering, SpaceX had said Cursor’s access to developers’ data, including coding requests and design decisions, could help improve xAI’s Grok model.
Gil Luria, head of technology research at the US investment firm DA Davidson, said Cursor would “improve SpaceX’s position in the frontier model race with Anthropic and OpenAI”. He added that Grok “has to have a coding component that enterprise customers can utilise side by side with [AI coding models] Anthropic Claude Code and OpenAI Codex.”
Anysphere will be paid in stock under the deal, a regulatory filing showed, and the deal will not use proceeds from SpaceX’s IPO. The transaction is expected to close in the third quarter of 2026.
The hedge fund billionaire Bill Ackman said the strong value of SpaceX’s stock was another boon for the company because it would require fewer of the company’s shares to pull off large acquisitions.
“One of the things that makes SpaceX so valuable is how valuable it is. The Cursor acquisition costs materially less in dilution because of SpaceX’s high valuation,” Ackman posted on X.
Anysphere is backed by prominent Silicon Valley venture capitalists such as Andreessen Horowitz and Thrive, as well as Nvidia and Google.
Jeff Bezos is back in an operating seat for the first time since stepping down from Amazon (NASDAQ: AMZN), pointing a $12 billion war chest at what he calls the engine of civilizational wealth: invention itself. In a CNBC interview on June 11, 2026, Bezos and co-CEO Vik Bajaj outlined Prometheus, a Series B round raising... Jeff Bezos Just Raised $12 Billion. He's Betting His Newest Business Will Create the Next Elon Musk or Henry Ford
Markets are digesting all the hyperscaler spending on the AI buildout, says Arun Sundaram, pointing to Amazon's (AMZN) $200 billion CapEx goal as something for investors to watch. However, the Mag 7 giant's fastest-growing tech businesses are also the most profitable.
@ProsperTradingAcademy's Charles Moon walks us through today's Big 3, all highlighting companies involved in the AI buildout. He likes Amazon (AMZN) for its recent rebound rally, CleanSpark (CLSK) for weathering a recent volatile storm, and CoreWeave (CRWV) for its recent inclusion in the Nasdaq-100 (NDX).
I keep buying Amazon (NASDAQ:AMZN | AMZN Price Prediction) and I am not going to apologize for it. The stock is down 6.86% over the past month while CNBC anchors argue about June inflation prints, and every time my brokerage screen flashes red I add a few more shares. This is a position I have been compounding into because the underlying business has decoupled from whatever the Fed says next month, and the receipts keep arriving every 90 days.
The thesis I keep coming back to is simple: Amazon now runs three growth machines stacked on top of a retail empire that still grew 15% in units last quarter, the strongest reading since the tail end of COVID lockdowns. Andy Jassy summed it up in the Q1 report: “AWS is growing 28% (our fastest growth in 15 quarters) on a very large base, our chips business topped a $20 billion revenue run rate (growing triple digits year-over-year), Advertising grew to over $70 billion in TTM revenue.” Read that sentence twice. That is the whole investment case in 54 words.
The Three Compounding Engines Start with AWS. Revenue hit $37.59 billion last quarter at a 37.7% operating margin, and the customer list now includes OpenAI committing roughly 2 GW of Trainium capacity through 2027 and Anthropic securing up to 5 GW. That is a multi-year revenue runway already booked.
Then there is the advertising business that the title of this piece points to. Over $70 billion in trailing twelve-month revenue, growing 24% year over year, attached to the most valuable purchase-intent data on earth. Ads carry margins closer to software than to retail, and management is still pushing into Netflix, Spotify, and Roku inventory.
Third, the custom silicon stack. Graviton, Trainium, and Nitro chips crossed a $20 billion annual run rate with triple-digit year-over-year growth. Amazon is becoming a chipmaker that happens to own a cloud, which compresses cost per token and widens the moat.
The composite financials show it. Q1 revenue rose 16.61% to $181.52B, EPS came in at $2.78 against a $1.73 estimate, and operating cash flow climbed 52.99% to $26.03 billion. Interest coverage sits at 35.17. This is a balance sheet that can fund ambition.
The Risk I Acknowledge The honest part. Free cash flow on a trailing twelve-month basis collapsed 95% to $1.2 billion because CapEx ran 76.68% higher year over year, and long-term debt climbed to $119.1 billion from $65.6 billion. Jassy has guided to roughly $200 billion in CapEx for 2026. If AI demand pauses, the depreciation bill arrives anyway. I have made peace with that risk because the customers signing multi-gigawatt contracts are the same companies setting AI roadmaps, and the spend is building owned infrastructure rather than rented capacity.
Why The Buy Button Stays Active Q2 guidance calls for 16% to 19% revenue growth, the stock has compounded 596.56% over ten years, and analyst consensus sits at $312.51 against today’s $246.02. June volatility gave me a discount on a business growing three engines at once. I will keep buying until the thesis breaks, and the thesis is not breaking.
Shares of Elon Musk's SpaceX soared more than 14% on Tuesday, lifting its value higher than Amazon and briefly Microsoft just days after its debut.
Shares in the rocket and AI company were selling for $220 (£164), more than 62% above the $135 (£101) Initial Public Offering (IPO) price, giving the company a market capitalisation of about $2.85trn (£2.12trn).
Image: SpaceX share price since IPO. SpaceX's share market rally saw the company top Amazon's valuation of $2.64trn (£1.97trn) and briefly beat Microsoft's of $2.92trn (£2.18trn), as it joined the ranks of the five most valued companies.
Amazon's revenue grew to $717bn (£543bn) last year, while SpaceX reported sales of $18.67bn (£13.91bn) and a net loss of $4.94bn (£3.68bn) after merging with money-losing xAI, in sharp contrast to many of Wall Street's biggest technology companies that have returned strong profits.
Image: Elon Musk during the launch of SpaceX on the stock market. Analysts and portfolio managers said investors should brace for volatility due to SpaceX's relatively small float and high valuation, particularly early on in the company's life as a public company.
"We can say with certainty that this valuation makes absolutely no sense today," said Ipek Ozkardeskaya, senior market analyst at Swissquote Bank.
"People are buying SpaceX in the expectation that others will buy too and push the price higher - that's speculation."
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SpaceX options have also began trading, offering investors another avenue to bet on the future of the newly listed shares.
"Today the SPCX options launch, offering standard monthly expiration and strikes ranging from $25 to $380," said Brent Kochuba, founder of option analytics platform SpotGamma.
"If call demand is heavy, dealers might be forced to buy SPCX into this low-liquidity situation.
"Starting next week we may see index demand increase, with more shares not slated to be made available for one to two months."
Image: Elon Musk. Read more from Sky News:
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SpaceX's rally could continue with the company set for fast-track inclusion in the Nasdaq 100, which will make it a major holding for passive funds and ETFs that track the index.
Trillion-dollar man: The rise of Elon Musk
FTSE Russell and MSCI are also set to add the stock to their indexes, from 26 June and 29 June, respectively.
"While index inclusion alone is typically insufficient to drive sustained repricing, we see the combination of passive flows, momentum, and limited float driving upside beyond historical index-addition moves," brokerage Zephirin Group said.
SpaceX said on Monday its underwriters had exercised the "greenshoe" option to purchase additional shares, increasing the total proceeds from its initial public offering to $85.7bn (£63.86) from $75bn (£55.88bn).
Earlier in the day, SpaceX also said it would acquire software company Anysphere for $60bn.
SpaceX (SPCX) has surpassed Amazon's (AMZN) market cap in intraday trading Tuesday, marking a monumental moment for the company. Andrew Chanin talks about the recent buying frenzy in SpaceX since its IPO, along with new plans to acquire cursor in a $60 billion deal.
Amazon.com shares are consolidating. Where is AMZN stock headed? Falling Oil Prices Lift Risk AppetiteAmazon is benefiting from a broad market rebound after the United States and Iran reached a peace agreement on Monday that ends their conflict and begins reopening the Strait of Hormuz. The decline in energy prices helped cool inflation concerns and fueled a strong rally in technology stocks.
President Donald Trump said that ships were already moving oil out of the strait, and senior officials noted that traffic would increase immediately even though full reopening will take longer due to mine‑clearing operations.
AWS Summit New York Set To OpenAhead of the summit, AWS has already delivered several product launches. EC2 M9g and M9gd instances powered by Graviton5 processors are now generally available and offer up to 25% better compute performance compared to Graviton4‑based instances.
AWS also introduced FinOps Agent in preview, a tool designed to answer cost questions, highlight optimization opportunities and investigate cost anomalies for engineering and finance teams. In addition, Google DeepMind's Gemma 4 model family is now available on Amazon Bedrock, and Amazon OpenSearch Service added support for MCP Apps to enable agentic observability workflows.
Prime Day 2026 ApproachesAmazon's retail segment is also seeing improved sentiment as Prime Day 2026 approaches. The event is scheduled for June 23 through June 26 and can increase trading interest in the stock in the weeks leading up to the sales period.
AMZN Shares Are Trending HigherAMZN Price Action: Amazon.com shares were up 0.17% at $246.43 at the time of publication on Tuesday, according to Benzinga Pro.
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While many retail investors got allocations of Space Exploration Technologies (SPCX +4.83%) when the stock IPO'd, others were left out. However, if you missed the IPO, I wouldn't be chasing the stock, as I think there are better companies to buy pursuing similar objectives.
SpaceX, as it is better known, operates three primary businesses. The first is its reusable rocket business, but this isn't why the company closed its first day of trading with a $2.1 trillion market cap. This is a solid business, but it's more of a launching pad (pun intended) for its other businesses. SpaceX's Starlink satellite internet service is its profit center. Once again, this is a nice business, but certainly not a trillion-dollar one.
Image source: Getty Images.
The company's biggest opportunity is its artificial intelligence (AI) business, which it views as having a total addressable market of $26.5 trillion. Through its earlier acquisition of another Elon Musk-backed company, xAI, SpaceX acquired a large hyperscale operation and the Grok large language model (LLM). The big ambition for this business is to eventually build data centers in space, which could be powered by solar power from near-constant sunlight. However, there are technical issues to overcome, including cooling the infrastructure in the vacuum of space, the finite usefulness of chips, and protecting them from cosmic radiation, which can corrupt data.
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Right now, SpaceX stock is valued mostly on the hope and dreams of a CEO with a very mixed track record of delivering on his promises, including timelines for autonomous driving and a large hyperloop system. As such, I think there are better stocks to buy.
1. Amazon If you're looking for a hyperscaler with space ambitions, look no further than Amazon (AMZN +0.05%). The company is the largest cloud computing provider in the world and is seeing strong acceleration in revenue growth in this business. It also has an established custom chip business, including its Trainium AI accelerators and Graviton central processing units (CPUs), that help give it a cost advantage.
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At the same time, Amazon is building a satellite internet service called Amazon Leo to compete with Starlink. While SpaceX does have an advantage with its own rocket operations, and Amazon saw a setback with the Blue Origin explosion, it's notable that no one was hurt, and none of its satellites were damaged. It's also contracted with multiple providers, and its strategy remains unchanged. Meanwhile, its recent acquisition of Globalstar will bring it important spectrum, device-to-device capabilities, and a close partnership with Apple.
I'd also throw in that Amazon is one of the world's leading robotics companies and much further along than Musk and his robot ambitions at Tesla.
2. Alphabet
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Alphabet (GOOGL +1.10%) (GOOG +1.09%) is also a much better buy than SpaceX right now. While SpaceX is trying to become a leading AI company, Alphabet is already the most complete one. Its Gemini model is a top-tier foundation model, while its Tensor Processing Units (TPUs) give it a significant advantage by reducing training and inference costs. Its ability to embed Gemini across its search and product ecosystem provides a much better monetization path.
Alphabet isn't ignoring space, either. It actually owns a large stake in SpaceX, and its Project Suncatcher is developing a constellation of solar-powered satellites powered by TPUs and free-space optical links to perform machine learning in space. It's actively working to improve TPUs' cosmic radiation tolerance and believes the cost of a space-based data center could become comparable to a land-based one in the mid-2030s.
I'd also note that Alphabet's Waymo is competing with Musk's Tesla in robotaxis and is much further ahead in deployments.
The verdict By investing in Amazon and Alphabet, you can get access to highly profitable leading companies pursuing many of the same strategies as the money-losing SpaceX at attractive valuations. Compare that to SpaceX, which trades largely on hype at the moment.
SpaceX briefly passed Amazon to become the fifth-most valuable company in the world, and nearly eclipsed Microsoft, before the company’s shares pared back those gains before the market closed Tuesday.
The newly public company’s stock had already climbed 20% on Monday — its first full day of trading. Tuesday’s news that SpaceX was acquiring AI coding company Cursor, along with the start of options trading on SpaceX’s shares, sent the share price even higher, spiking its valuation to $2.9 trillion before it ultimately settled back down.
This is all despite the fact that SpaceX posted a $4.9 billion loss on $18.7 billion in revenue last year, compared to Amazon, which turned a $78 billion profit in 2025 on $717 billion in sales in 2025. SpaceX has recently added new revenue streams in the form of compute leasing deals with Anthropic and Google, though, and will absorb the revenue from Cursor when that deal closes in the third quarter.
The Anthropic and Google deals are non-binding, but investors don’t seem to mind either way. Elon Musk’s space-and-AI company had added roughly $1 trillion to its valuation since going public on Friday.
That transaction netted SpaceX nearly $86 billion in fresh capital, largely on promises that it can create an AI business worth trillions of dollars — a wild claim for a company that recently tore its AI division down to the studs.
SpaceX first revealed a collaboration with Cursor in April, at a time when Musk said his AI company xAI — now a part of SpaceX — “was not built right [the] first time around” and that he was rebuilding it “from the foundations up.” SpaceX is making the acquisition with $60 billion in company shares.
SpaceX’s historic IPO saw it debut with a valuation of around $1.7 trillion, and the transaction raised nearly $86 billion for Musk’s company. SpaceX only made about 4% of its total shares available for trading, which experts predicted would make the stock more susceptible to wild swings.
That appeared to be the case Tuesday, as traders swapped more than 300 million SpaceX shares throughout the trading day — more than half of the 555 million available on the public market post-IPO, according to data from the Nasdaq stock exchange.
The volatility continued into after-hours trading, which saw SpaceX’s valuation briefly eclipse Amazon’s market cap for a second time before falling again.
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Sean O’Kane is a reporter who has spent a decade covering the rapidly-evolving business and technology of the transportation industry, including Tesla and the many startups chasing Elon Musk. Most recently, he was a reporter at Bloomberg News where he helped break stories about some of the most notorious EV SPAC flops. He previously worked at The Verge, where he also covered consumer technology, hosted many short- and long-form videos, performed product and editorial photography, and once nearly passed out in a Red Bull Air Race plane.
You can contact or verify outreach from Sean by emailing [email protected] or via encrypted message at okane.01 on Signal.
A box with a customer order passes through a laser scanner at Amazon's LCY3 fulfilment centre in Dartford, Britain, June 4, 2026. REUTERS/Toby Shepheard Purchase Licensing Rights, opens new tab
CompaniesJune 16 (Reuters) - Amazon.com (AMZN.O), opens new tab may face a U.S. Federal Trade Commission lawsuit that could result in civil penalties, following allegations that the e-commerce giant misled advertisers, Bloomberg News reported on Tuesday.
The FTC has a possible complaint against Amazon as part of an ongoing probe, Bloomberg reported, citing people familiar with the matter. Several state attorneys general are also participating.
Jumpstart your morning with the latest legal news delivered straight to your inbox from The Daily Docket newsletter. Sign up here.
The agency has been investigating whether Amazon and Alphabet's (GOOGL.O), opens new tab Google misled advertisers that place ads on their websites, Reuters reported last year.
The investigations are being conducted by the FTC's consumer protection unit, and focus on whether Amazon and Alphabet properly disclosed terms and pricing for ads.
The FTC is seeking details about Amazon's advertising auctions and whether it disclosed "reserve pricing" for some search ads. Reserve pricing refers to the minimum price advertisers must accept before they can buy an ad.
The agency may wrap up the probe either through a lawsuit or settlement as soon as this summer, according to Bloomberg.
The FTC declined to comment, while Amazon did not immediately respond when contacted by Reuters.
The e-commerce giant in September agreed to pay $2.5 billion in fines and reimbursements, opens new tab to Prime subscribers to settle FTC's allegations that it deceived its customers to generate subscriptions.
Reporting by Juby Babu in Mexico City; Editing by Joyjeet Das and Anil D'Silva
Our Standards: The Thomson Reuters Trust Principles., opens new tab
SummaryAmazon remains a Strong Buy as fundamentals improve, despite recent underperformance versus the benchmark.Double-digit revenue growth across core segments and AWS's 28% YoY growth reinforce AMZN's diversified business model and moat.Operating cash flow surged 30% YoY, supporting Amazon's ambitious AI and capex initiatives, including major partnerships with Nvidia and Anthropic.Risks include slower growth, margin stagnation, macro headwinds, and opportunity cost, but no structural concerns undermine the bull thesis. Stefan Sutka/iStock Editorial via Getty Images
Sure enough, I anticipated a much better period for Amazon (AMZN). But the stock declined by 2% since my last piece. And has underperformed versus the benchmark.
While I have already highlighted that
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Analyst’s Disclosure: I/we have a beneficial long position in the shares of AMZN, NVDA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
LOS ANGELES, June 16, 2026 (GLOBE NEWSWIRE) -- The Schall Law Firm, a national shareholder rights litigation firm, reminds investors of a class action lawsuit against Microsoft Corporation (“Microsoft” or “the Company”) (NASDAQ: MSFT) for violations of §§10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder by the U.S. Securities and Exchange Commission.
Investors who purchased the Company’s securities between May 1, 2025 and January 28, 2026, inclusive (the “Class Period”), are encouraged to contact the firm before August 11, 2026.
If you are a shareholder who suffered a loss, click here to participate.
We also encourage you to contact Brian Schall of the Schall Law Firm, 2049 Century Park East, Suite 2460, Los Angeles, CA 90067, at 310-301-3335, to discuss your rights free of charge. You can also reach us through the firm's website at www.schallfirm.com, or by email at [email protected].
The class, in this case, has not yet been certified, and until certification occurs, you are not represented by an attorney. If you choose to take no action, you can remain an absent class member.
According to the Complaint, the Company made false and misleading statements to the market. Microsoft’s Copilot AI products suffered from problems ranging from poor user experience to capacity limitations. The Company’s AI model ranked poorly against competitors on industry benchmark tests. The Company would need to spend billions on capital expenditures related to AI including diverting hardware away from profitable business units to improve its competitive posture in artificial intelligence. The Company was incapable of converting a large percentage of Microsoft 365 users to paid Copilot subscriptions, losing market share to rivals. Based on these facts, the Company’s public statements were false and materially misleading throughout the class period. When the market learned the truth about Microsoft, investors suffered damages.
Join the case to recover your losses
The Schall Law Firm represents investors around the world and specializes in securities class action lawsuits and shareholder rights litigation.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and rules of ethics.
CONTACT:
The Schall Law Firm
Brian Schall, Esq.,
www.schallfirm.com
Office: 310-301-3335 [email protected]
Shares of SpaceX (NASDAQ:SPCX) are up 14% in early trading Tuesday, zooming to $219. This pushes the newly public rocket and connectivity giant’s market cap past $2.9 trillion, putting SPCX stock within striking distance of the world’s biggest tech names.
The trigger is a blockbuster acquisition announcement. SpaceX confirmed it will acquire Anysphere, the company behind the AI coding tool Cursor, for $60 billion in an all-stock transaction expected to close in Q3 2026, pending regulatory approvals.
The move puts SPCX stock roughly in line with Microsoft (NASDAQ:MSFT | MSFT Price Prediction) stock, which carries around a $2.95 trillion market cap. Combined with Tesla (NASDAQ:TSLA), CEO Elon Musk’s other publicly traded mega-cap, the pair would sit near Apple‘s (NASDAQ:AAPL) roughly $4.3 trillion market cap.
$60 Billion Cursor Deal Fuels the Rally The Cursor deal is an undeniable catalyst. SpaceX is exercising an option it secured in April giving it the right to either pay roughly $10 billion for a partnership with Cursor or acquire the company for $60 billion later in the year, and it chose the full buyout.
Cursor, founded in 2022, is an AI-powered code editor offering a chatbot assistant, code autocomplete, and autonomous AI coding agents. The startup has roughly $2.6 billion in annualized revenue with rising enterprise sales, and was recently in talks to raise funding at a roughly $50 billion valuation.
SpaceX is framing the acquisition as a push into enterprise AI software, layering developer tools onto its Space, Connectivity, and AI segments. The company generated $4.694 billion in consolidated revenue in the three months ended March 31, so the Cursor business would meaningfully change the top-line mix from day one.
Stacking Up Against Microsoft and Apple The comparison to Microsoft and Apple is where the caution case starts. Microsoft is solidly profitable, posting a 39% profit margin on $318 billion in trailing revenue. SpaceX, by contrast, is not yet profitable on a consolidated basis.
Apple isn’t a perfect comparison, either. The iPhone maker’s roughly $4.3 trillion market cap is supported by $451 billion in trailing revenue and a 27% profit margin. SpaceX’s enterprise AI ambitions also put it on a collision course with Alphabet‘s (NASDAQ:GOOGL) Google, whose Cloud unit grew 63% last quarter.
SPCX stock has gone vertical since its debut. priced at $135 on June 11, opened around $150 and closed near $161 on the June 12 debut, then rose 11% to $178 on Monday. Today’s rally further extends the post-IPO run.
Retail Frenzy Meets the Options Launch Retail demand has been a major engine of the move. SpaceX has been the most-bought stock by retail investors for two consecutive sessions, with around $100 million in net buying Monday, per Vanda Research.
Adding fuel today, stock options on SpaceX begin trading Tuesday, the first time investors can use derivatives on the newly public name. That tends to widen the buyer pool, attract hedging flows, and amplify intraday volatility.
Reddit chatter reflects the speculative tone. Posts framing SpaceX as a “guaranteed lottery ticket” have drawn thousands of upvotes, while skeptical threads questioning whether “price discovery is even real right now” are gaining traction in parallel.
What to Watch The bull case is straightforward. SpaceX is bolting a fast-growing AI developer tools franchise onto Starlink and its launch business, and retail demand is keeping bids firm into the options debut. Investors who buy the multi-platform thesis can frame today’s move as validation of an enterprise AI expansion rather than froth.
The caution case is just as clear. A $60 billion all-stock deal carries real execution and regulatory risk, SPCX stock is being priced alongside profitable trillion-dollar peers despite no consolidated profits yet, and the rally is powered by a brand-new listing with limited float. Investors may want to size their positions modestly and watch how the stock trades once options market makers and lockup mechanics start setting the tone.
Keep an eye on whether the premarket gains hold through the open, how aggressively the new options chain trades, and any regulatory commentary as the Cursor acquisition moves toward its targeted Q3 2026 close. Those signals will help separate durable enterprise-AI enthusiasm from post-IPO froth.
Elon Musks inspiring speech ahead of SpaceX IPO Elon Musk delivers an inspiring speech at the SpaceX IPO event, sharing his initial doubts about the companys success but emphasizing the importance of making life multi-planetary and creating an exciting future for everyone.
SpaceX stock continued to surge on Tuesday following its record-setting IPO last week, with the company's market capitalization surpassing Amazon and briefly topping Microsoft.
Elon Musk's SpaceX debuted on the Nasdaq on Friday following its IPO and shares have risen about 35% since it began trading last week, as traders look to capitalize on its momentum.
Tuesday saw SpaceX's stock climb as much as 15% in early trading, which pushed the company's market cap beyond the $2.66 trillion valuation for Amazon and Microsoft's $2.93 trillion market value.
That briefly made it the fourth-largest global company by market cap before some of those gains were pared back.
SPACEX MAKES HISTORIC DEBUT; MUSK SOLIDIFIES STATUS AS WORLD'S FIRST TRILLIONAIRE
Ticker Security Last Change Change % SPCX SPACE EXPLORATION TECHNOLOGIES CORP. 201.80 +9.30 +4.83% AMZN AMAZON.COM INC. 246.00 -0.02 -0.01% MSFT MICROSOFT CORP. 393.83 -5.93 -1.48% SpaceX's stock was boosted by the announcement that it would acquire Anysphere for $60 billion.
Anysphere is the parent company of Cursor, which is the provider of a coding agent powered by artificial intelligence (AI) and has become a popular "vibe-coding" tool.
SpaceX and Cursor announced a partnership in April that paired Cursor's product and software engineering expertise with SpaceX's supercomputers.
HOW THE HISTORIC SPACEX IPO IS TURNING EVERYDAY WORKERS INTO OVERNIGHT MILLIONAIRES
SpaceX CEO Elon Musk became the world's first trillionaire on paper after the company's IPO last week. (Jessica Christian/San Francisco Chronicle via Getty Images)
The deal gave SpaceX the option of acquiring Cursor this year for $60 billion or paying $10 billion for the joint work.
"SpaceX has exercised the option to acquire @cursor_ai in an all-stock transaction with the goal of building the world's most useful AI models," SpaceX wrote in a post on X.
"For the past few months, SpaceXAI has been jointly training a model with Cursor, which will be released in Cursor and Grok Build soon. We look forward to working closely with the Cursor team to advance our frontier AI capabilities," SpaceX added.
SPACEX SET A NEW RECORD FOR IPOS: THESE ARE THE WORLD'S 5 LARGEST
SpaceX has ambitious goals for developing space-based AI data centers, which contributed to its acquisition of Cursor. (AFP via Getty Images)
In its IPO filing, SpaceX said that Cursor's access to developers' data, such as coding requests and design decisions, could help improve its AI models like Grok.
Grok was developed by xAI, Musk's AI startup, which acquired the X social media platform formerly known as Twitter.
SpaceX announced the acquisition of xAI in February, which Musk said would "form the most ambitious, vertically-integrated innovation engine on (and off) Earth, with AI, rockets, space-based internet, direct-to-mobile device communications and the world's foremost real-time information and free speech platform."
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Musk and SpaceX are planning to deploy space-based AI data centers, as he believes that the electricity demand sparked by the global AI boom can't be met by terrestrial solutions and that scaling will require the use of space-based AI powered by energy from the sun and cooled by the depths of space.
by John Cook on Jun 16, 2026 at 7:56 amJune 16, 2026 at 7:57 am
Elon Musk celebrates the SpaceX IPO last week. (Nasdaq Photo) Shares of SpaceX surged Tuesday morning, pushing the Elon Musk-led company above Amazon and into a neck-and-neck race with Microsoft for the title of the world’s fourth-most valuable public company, less than a week after its blockbuster $75 billion IPO.
The rocket maker, satellite internet provider, defense contractor, and AI company is now valued at more than the entire economy of Italy.
The jump came after SpaceX announced its $60 billion acquisition of AI coding startup Cursor, a San Francisco-based company that last November said it was generating more than $1 billion in annualized revenue.
“We look forward to working closely with the Cursor team to advance our frontier AI capabilities,” SpaceX wrote in a message on X on Tuesday morning.
That helped propel SpaceX to stratospheric heights.
Its market capitalization stood at roughly $2.94 trillion at one point on Tuesday morning, well ahead of Amazon’s $2.66 trillion valuation. SpaceX also topped 51-year-old Microsoft in value for periods on Tuesday, going back and forth with the Redmond tech giant. Microsoft is valued at roughly $2.93 trillion.
Nvidia remains the most valuable company, with a stock market value just over $5 trillion, followed by Alphabet at $4.51 trillion and Apple at $4.37 trillion.
SpaceX’s achievement underscores how rapidly investor attention has shifted toward companies operating at the intersection of artificial intelligence, space infrastructure, defense and communications networks. But it also speaks to the allure of Musk, with Vanda Research indicating that SpaceX accounted for about three-quarters of all single stock purchases by retail investors on Monday.
“The company that’s accustomed to defying gravity is now defying market physics,” CNN noted.
The Cursor acquisition signals Musk’s ambition to build a vertically integrated AI powerhouse spanning chips, data centers, software, communications networks and space infrastructure.
The stock surge also adds a new dimension to the story GeekWire explored last week, examining what the SpaceX IPO means for Seattle and the broader Pacific Northwest space industry. SpaceX maintains a significant engineering presence in Redmond, where employees develop Starlink satellite technology and related communications systems, making the region an important outpost what has become in a matter of days one of the world’s most valuable companies.
For Amazon and Microsoft, the comparison is largely symbolic. The Seattle area tech giants generate hundreds of billions of dollars in annual revenue and operate dominant businesses in cloud computing.
But Wall Street’s willingness to value SpaceX above Amazon and Microsoft highlights how investors increasingly view AI and space as the next major technology frontier. SpaceX also competes directly with Amazon’s Leo satellite broadband network business.
Whether SpaceX can sustain a valuation at these levels remains an open question. Some analysts and tech watchers have described the stock’s post-IPO run as highly speculative, noting that the company posted a loss following its merger with Musk’s xAI.
Still, the message from the market is clear: at least for now, investors see it as one of the defining technology companies of the decade.
New York, New York--(Newsfile Corp. - June 16, 2026) - Bronstein, Gewirtz & Grossman, LLC, a nationally recognized investor-rights law firm, announces that a class action lawsuit has been filed against Microsoft Corporation (NASDAQ: MSFT) and certain of its officers.
This lawsuit seeks to recover damages against Defendants for alleged violations of the federal securities laws on behalf of all persons and entities that purchased or otherwise acquired Microsoft securities between May 1, 2025 and January 28, 2026, both dates inclusive (the "Class Period"). Such investors are encouraged to join this case by visiting the firm's site: bgandg.com/MSFT.
Microsoft Case Details
The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements because they failed to disclose that:
Microsoft's Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; Microsoft's flagship proprietary AI model ranked well below competitors on a number of benchmark tests; Microsoft needed to increase by billions of dollars its capital expenditures and divert graphics processing unit ("GPU") and central processing unit ("CPU") capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related research and development ("R&D"); and as a result of the above, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and Microsoft's Copilot offerings had lost market share to rival products, a trend that was increasing.What's Next for Microsoft Investors?
A class action lawsuit has already been filed. If you wish to review a copy of the Complaint, you can visit the firm's site: bgandg.com/MSFT, or you may contact Peretz Bronstein, Esq. or his Client Relations Manager, Nathan Miller, of Bronstein, Gewirtz & Grossman, LLC at 917-590-0911. If you suffered a loss in Microsoft you have until August 11, 2026, to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn't require that you serve as lead plaintiff.
No Cost to Microsoft Investors
We, Bronstein, Gewirtz & Grossman LLC, represent investors in class actions on a contingency fee basis. That means we will ask the court to reimburse us for out-of-pocket expenses and attorneys' fees, usually a percentage of the total recovery, only if we are successful.
Why Bronstein, Gewirtz & Grossman, LLC for Microsoft Securities Class Action?
Bronstein, Gewirtz & Grossman, LLC is a nationally recognized firm that represents investors in securities fraud class actions and shareholder derivative suits. Our firm has recovered hundreds of millions of dollars for investors nationwide. More at www.bgandg.com
"Our practice centers on restoring investor capital and ensuring corporate accountability, which serves to uphold the essential integrity of the marketplace," said Peretz Bronstein, Founding Partner of Bronstein, Gewirtz & Grossman, LLC.
Follow us for updates on LinkedIn, X, Facebook, or Instagram.
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Prior results do not guarantee similar outcomes.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/301520
Source: Bronstein, Gewirtz & Grossman, LLC
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Many investors have been kicking Microsoft (MSFT 1.43%) to the curb. It's down by almost 20% year to date as fellow tech stocks continue to rally. The State Street Technology Select Sector SPDR ETF's 28% year-to-date rally truly captures how much Microsoft has fallen in the eyes of many investors.
However, it may be too early to count Microsoft out, especially since its strong fundamentals remain intact.
Image source: Getty Images.
Microsoft is still gaining market share thanks to AI Perhaps some growth investors have given up on Microsoft because it's not doubling revenue year over year like some of the top-performing AI stocks. However, it's still gaining ground on its peers thanks to AI, which has translated into steady financial growth.
Revenue inched up by 18% year over year in Microsoft's fiscal 2026 third quarter. CEO Satya Nadella said the company's AI business reached an annual revenue run rate of $37 billion, a 123% year-over-year increase. Microsoft Cloud once again remained the main growth driver, and it was up by 29% year over year.
Microsoft is also ahead of the curve in agentic AI, with Copilot and AI agents integrated into many Microsoft products. The company's AI investments have translated directly into rising revenue and profits. Microsoft's net income grew 23% year over year, demonstrating it can expand profit margins while gaining market share.
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The valuation is extremely low A stock's valuation influences whether it is a good deal. Microsoft's growth numbers wouldn't be impressive if the stock carried a 100 P/E ratio. That's a much higher valuation than some of the fastest-growing companies. However, Microsoft only trades at a 23.3 P/E ratio. The company's P/E ratio sat in the mid-30s for most of 2025.
Tech investors have been spoiled with mind-boggling revenue and net income growth rates. It makes Microsoft's numbers feel pedestrian, but that's the exact setup that creates deep value opportunities.
Grandview Research projects a 16% CAGR for the cloud computing market from now until 2033. Microsoft is outpacing that growth rate, and as cloud continues to grow, it will continue to make up an outsize percentage of Microsoft's total business. As that happens, some of Microsoft's underperforming segments won't drag the company down as much, translating into higher growth numbers moving forward.
Many "Magnificent Seven" stocks have lower P/E ratios than they had a few years ago. Microsoft is the second cheapest stock among these options, only being edged out by Meta Platforms' 20.6 P/E ratio, another stock that has been surprisingly discarded by many investors despite strong fundamentals.
Value isn't always recognized right away, and that gives Microsoft investors the opportunity to buy shares at bargain prices before the next rally.
LOS ANGELES--(BUSINESS WIRE)--Glancy Prongay Wolke & Rotter LLP, a leading national shareholder rights law firm, today announced that it has commenced an investigation on behalf of Microsoft Corporation (“Microsoft” or the “Company”) (NASDAQ: MSFT) investors concerning the Company's possible violations of the federal securities laws.IF YOU ARE AN INVESTOR WHO LOST MONEY ON MICROSOFT CORPORATION (MSFT), CLICK HERE TO INQUIRE ABOUT POTENTIALLY PURSUING CLAIMS TO RECOVER YOUR LOSS.What Happened.
Two artificial intelligence companies are likely going to ask public markets to buy into them at valuations in the vicinity of $1 trillion this fall. Both are unprofitable. Both are spending money at a rate that would terrify CFOs at any other company on earth. And yet the race between Anthropic and OpenAI to go public sets up one of the most consequential investment decisions individual investors will face in the next 12 months, because despite their similarities, the two companies are not the same bet.
Here's why: Anthropic filed its S-1 confidentially on June 1 following a $65 billion Series H round that valued the company at $965 billion. This briefly made it the most valuable start-up in the world, ahead of OpenAI. Anthropic's annualized revenue run rate hit $47 billion in May, up from $4 billion just 14 months earlier. More importantly, Anthropic management has offered guidance predicting that it's headed for its first profitable quarter.
Image source: Getty Images.
OpenAI is valued at approximately $852 billion, with an annualized revenue run rate of roughly $30 billion. That sounds similar. But OpenAI's internal documents project it will book a loss of $14 billion in 2026 -- roughly three times its 2025 loss -- driven by compute costs, research hiring, and infrastructure expansion. The company's internal forecast is for cumulative losses of $44 billion through 2028, with profitability not arriving until 2029.
These are not small differences. One company is approaching its first profitable quarter. The other is on pace to burn $14 billion this year.
How Anthropic won already without anyone noticing The story that matters most isn't valuation -- it's where the money is coming from and why it keeps accelerating.
Anthropic's Claude Code -- a terminal-based artificial intelligence coding tool -- now holds 54% of the enterprise AI coding market. OpenAI holds 21%. That's not a close race. Coding accounts for 51% of all enterprise AI spending, and Anthropic collects the majority of it. Claude Code crossed $2.5 billion in annualized revenue as a stand-alone product. That single product line is larger than most public SaaS companies.
This matters for IPO investors because enterprise software is sticky in a way that consumer products are not. When a company's engineering team builds its entire development workflow around Claude Code, they aren't going to change tools because a competitor runs a campaign. Switching costs are real, and Anthropic is accumulating them at scale.
None of this means OpenAI is a bad investment. ChatGPT remains the most recognized AI brand in the world, with a far wider consumer footprint than Anthropic's. OpenAI's partnership with Microsoft (MSFT 1.43%) -- which through a complex structure holds a significant stake in OpenAI -- gives it a distribution channel that reaches virtually every enterprise on earth through Microsoft 365 and Azure. When OpenAI goes public, it will do so with brand recognition in the consumer market that Anthropic lacks, and a commercial relationship with Microsoft that keeps enterprise doors open regardless of what Claude Code is doing.
The problem is that brand recognition alone won't reduce its losses. OpenAI introduced ads into its free ChatGPT tier this year. This is a clear sign that the path to monetizing its consumer base is proving harder than the early growth suggested.
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Which one could deliver bigger returns? This is the honest answer: Neither is guaranteed to deliver gains, and anyone who tells you otherwise isn't reading the same S-1s you are.
But if I had to pick one heading into an IPO, I think Anthropic is the far more interesting investment right now. It grew its revenue run rate from $4 billion to $47 billion in 14 months, has captured the majority of the market for the highest-value AI use case, and is approaching profitability, which OpenAI isn't.
OpenAI may still win. It has more capital, a powerful brand, and its Microsoft relationship as a structural backstop. But Anthropic is winning the enterprise battle where it counts, in the tools engineers reach for every day.
Glancy Prongay Wolke & Rotter LLP, a leading national shareholder rights law firm, today announced that it has commenced an investigation on behalf of Microsoft Corporation (“Microsoft” or the “Company”) (NASDAQ: MSFT) investors concerning the Company’s possible violations of the federal securities laws.
IF YOU ARE AN INVESTOR WHO LOST MONEY ON MICROSOFT CORPORATION (MSFT), CLICK HERE TO INQUIRE ABOUT POTENTIALLY PURSUING CLAIMS TO RECOVER YOUR LOSS.
What Happened?
On January 28, 2026, Microsoft announced disappointing results for its second quarter of fiscal 2026, revealing that growth of its cloud computing platform, Azure, had slowed suddenly and fallen below analyst expectations due primarily to computational capacity constraints, as the Company had diverted central processing unit and graphics processing unit capacity to applications for its generative AI chatbot, Copilot, and AI-related research and development. The Company also revealed that its capital expenditures had increased to $37.5 billion during the quarter, causing the Company’s capital expenditures for the first six months of fiscal 2026 to expand to $72.4 billion compared to $88.2 billion for the entirety of fiscal 2025, largely due to AI-related research and development and Copilot development and capacity buildout costs. Additionally, Microsoft disclosed that the amount of paying users of Copilot was well below analyst estimates.
On this news, Microsoft’s stock price fell $48.13, or 9.99%, to close at $433.50 per share on January 29, 2026, thereby injuring investors.
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Glancy Prongay Wolke & Rotter LLP,
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Persons with non-public information regarding Microsoft should consider their options to aid the investigation or take advantage of the SEC Whistleblower Program. Under the program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Charles H. Linehan at 310-201-9150 or 888-773-9224 or email [email protected].
About Glancy Prongay Wolke & Rotter LLP
GPWR is a premier law firm with decades of experience representing investors and consumers in securities litigation and other complex class action litigation. Recognizing the firm’s recent successes, GPWR was named one of Law360’s Securities Groups of the Year and ranked second-highest in total investor recoveries by Institutional Shareholder Services Securities Class Action Services in 2025. GPWR’s lawyers have handled cases covering a wide spectrum of corporate misconduct and relating to nearly all industries and sectors. GPWR’s past successes have been widely covered by leading news and industry publications such as The Wall Street Journal, The Financial Times, Bloomberg Businessweek, Reuters, the Associated Press, Barron’s, Investor’s Business Daily, Forbes, and Money. Prior results do not guarantee a similar outcome.
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SAN DIEGO--(BUSINESS WIRE)---- $MSFT #Hardware--Robbins LLP informs stockholders that a class action was filed on behalf of all investors who purchased or otherwise acquired Microsoft Corporation (NASDAQ: MSFT) securities between May 1, 2025 and January 28, 2026. Microsoft is one of the largest technology conglomerates in the world. For more information, submit a form, email attorney Aaron Dumas, Jr., or give us a call at (800) 350-6003. The Allegations: Robbins LLP is Investigating Allegations that Microsoft Corp.
In its first few days of trading on the public market, Space Exploration Technologies Corp (NASDAQ: SPCX) has lived up to the hype.
After going public on Friday and raising nearly $86 billion, the stock is now up close to 32%. As of 2:23 p.m. ET, the stock traded near $213 per share and had a market cap of $2.82 trillion.
That puts SpaceX ahead of Amazon and within reach of Microsoft. It’s now the fifth-largest company in the world by market cap.
It’s pretty incredible to see a company go public and, within days, become one of the largest in the world. But it’s also uncharted territory for investors. Here’s how to think about the valuation.
Image source: Getty Images.
Breaking down SpaceX’s three segmentsSpaceX has three segments: space, connectivity, and artificial intelligence.
The space division conducts rocket launches for commercial clients and sends astronauts into space. The company has managed to build reusable rockets like the Falcon 9, which lowers launch costs.
Interestingly, the space division has the lowest total addressable market (TAM) at $370 billion. However, it’s the reusable rocket technology that powers the entire thesis.
The next division is connectivity, also known as Starlink, which has established a low-Earth-orbit satellite internet service with over 10,400 satellites. The ultimate goal is to have around 42,000 total.
Starlink, with 10.3 million users, is already a good business. In 2025, the division generated nearly $11.4 billion in revenue and an operating profit of roughly $4.4 billion. SpaceX believes Starlink’s TAM is $1.6 trillion.
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The last division is AI. SpaceX only added this division earlier this year when it acquired xAI, another company founded by Elon Musk.
The AI division encompasses the social media platform X, the Grok intelligence platform, the company’s data centers, and a planned terafab facility built in partnership with Tesla and Intel.
The AI division is also planning to build orbital data centers in space and offer enterprise applications to businesses. SpaceX believes the TAM of this business is $26.5 trillion.
Looking at the assigned TAMs, the AI division is the clear driver of the company’s enormous valuation. The business will need to deliver on some of its bigger promises, such as orbital data centers, if it wants to sustain its current valuation and grow it.
In meetings with investors, Goldman Sachs bankers reportedly told prospective investors that it thinks the AI division can grow revenue by 100-fold by 2030.
Investors already saw the AI division flex its muscles when it signed two massive AI compute deals with Anthropic and Google, totaling $2.2 billion in combined monthly revenue.
A team of analysts at Morningstar assigned the AI division a “moonshot” valuation of nearly $108 per share, which assumes it “rapidly scales orbital data centers to capture 20% of our forecast AI computing capacity by 2040.”
However, Morningstar assigns only a 7% likelihood to this outcome, although they are the most bearish analyst team on Wall Street in their assessment of SpaceX.
Another thing to note is that enterprise applications account for $22.7 trillion of the company’s total TAM.
The concept for enterprise applications is vague, but in its prospectus, SpaceX says it is working with Tesla to develop an agentic AI platform called Macrohard.
If successful, Macrohard would be “capable of fully emulating digital workflows and augmenting human operation of computers—from coding and product development to management and entire business processes—using sophisticated autonomous agents.”
The big takeaway is that SpaceX’s valuation hinges on the AI division, which investors are banking on to build orbital data centers at scale to power Grok and Macrohard, which will create and run agents that can basically work like humans.
It’s hard to understand how investors are willing to reward the company with a valuation suggesting all of these ideas are close to happening.
But perhaps investors see Musk and SpaceX being the closest to such ambitions, making a potentially massive reward worth the risk.
Tesla has also long traded at a premium multiple, so it’s possible investors assumed SpaceX would receive similar treatment.
Credit: Angel Bena from Pexels Microsoft is changing how it charges for its software for the first time in two decades, moving to bill customers with a pay-as-you-go model each time they use its new AI agent.
The change, prompted by the soaring cost of artificial intelligence, came Tuesday as the company launched Copilot Cowork—an AI "agent" that can independently carry out office tasks like drafting documents, building spreadsheets and sending emails.
The tool still requires a paid Microsoft 365 Copilot subscription, but now every task it runs is billed separately, based on how much computing power it consumes.
Copilot Cowork is Microsoft's take on so-called "agentic" AI, a wave that has gripped Silicon Valley and turned the simple chatbot into an assistant capable of acting on a user's behalf.
Like rival tools on Google's and Amazon's enterprise platforms, it can be handed an assignment and run with it on its own, sometimes for several hours.
Microsoft says one customer used it to compare nearly 4,000 documents in a matter of hours, and that the assistant can prepare complex meetings by synthesizing emails, internal documentation and calendars.
The reason for the new pricing comes down to cost: Running these AI systems demands vastly more computing power than a search engine or a chatbot, and usage can vary widely from one user to the next.
The new plan will be "like you're filling up your gas tank at the pump," Charles Lamanna, Microsoft's executive vice president for Copilot and agents, told AFP.
Under the old system, "there's not one overarching user license that makes sense," he said, given that different users consume widely varying levels of computing power.
The turn is a notable one for Microsoft, whose office software has relied for some two decades on fixed, predictable subscription fees.
"This is a big evolution for us ... which has been a user subscription-based business for so long, for really like two decades," Lamanna acknowledged, calling the new approach "the only way to make the model work."
To guard against runaway bills, the service is disabled by default, and companies can cap spending per employee, per team or per department.
Microsoft is not alone in taking this route. Its programming subsidiary GitHub moved to usage-based billing in early June, sparking anger among developers, some of whom saw their bills shoot up.
Anthropic, one of the United States' AI flagships, announced in early June that its newest cutting-edge models would soon be billed by usage rather than included in subscriptions, even premium ones.
Another way to ease the bill: Users will be able to choose which model is used, more or less powerful and therefore more or less expensive.
At general availability, Copilot Cowork runs on Anthropic models, including Opus 4.8 and Sonnet 4.6, while customers on the "Frontier" tier can use the state-of-the-art GPT 5.5.
A "significantly cheaper" model, named Cowork 1, is coming soon for everyday tasks.
Who's behind this story?
Andrew Zinin Master's in physics with research experience. Long-time science news enthusiast. Plays key role in Science X's editorial success. Full profile →
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Entering Monday, shares of Microsoft (MSFT) were off 17.44% year-to-date, a stark, discouraging performance relative to some other megacap technology and artificial intelligence (AI)-adjacent names. However, there may be a silver lining for opportunistic traders.
Microsoft’s fundamentals are still widely viewed as compelling, and some experts argue the stock is now attractively value. Either or both factors could enhance the case for occasional use of the Direxion Daily MSFT Bull 2X Shares (MSFU) — an ETF designed to deliver 200% of the tech stock’s daily movements.
Indeed, Microsoft is battered and bruised this year, but that condition may not last for long. Credible fundamental factors underpin that perspective, indicating that MSFU still offers utility to nimble short-term traders.
“Microsoft is one of three public cloud providers that can deliver a wide variety of PaaS/IaaS solutions at scale. Based on its investment in OpenAI, the company has also emerged as a leader in AI,” noted Morningstar’s Dan Romanoff. “Microsoft has also enjoyed great success in upselling users on higher-priced Office 365 versions, notably to include advanced telephony features. These factors have combined to drive a more focused company that offers impressive revenue growth with high and expanding margins and deepening ties with customers.”
MSFU Can Get Its Groove Back Microsoft makes Morningstar’s cut among the best technology stocks to consider today, but traders considering MSFU are apt to want more. The catalysts are there and could soon crystallize, particularly as the company rejuvenates some of its more basic — though profitable — products into higher-scale solutions.
“Microsoft is also shifting its traditional on-premises products to become cloud-based SaaS solutions. Critical applications include LinkedIn, Office 365, Dynamics 365, and the Power Platform, with these moves now beyond the halfway point and no longer a financial drag. Office 365 retains its virtual monopoly in office productivity software, which we do not expect to change in the foreseeable future,” added Romanoff.
Traders mulling MSFU should also stay on watch for analysis pertaining to the highly lucrative Azure cloud business, because the unit has been and can again be a kick-starter for ETFs like MSFU.
“We believe that Azure is the centerpiece of the new Microsoft. Even though we estimate it is already an approximately $75 billion business, it is still growing at approximately 30% annually. Azure has several distinct advantages, including that it offers customers a painless way to experiment and move select workloads to the cloud, creating seamless hybrid cloud environments,” concluded Romanoff.
For more news, information, and strategy, visit the Leveraged & Inverse Content Hub.
WHY: Rosen Law Firm, a global investor rights law firm, announces a class action lawsuit on behalf of purchasers of common stock of Microsoft Corporation (NASDAQ: MSFT) between May 1, 2025 and January 28, 2026, inclusive (the “Class Period”). A class action lawsuit has already been filed. If you wish to serve as lead plaintiff, you must move the Court no later than August 11, 2026.
SO WHAT: If you purchased Microsoft common stock during the Class Period you may be entitled to compensation without payment of any out of pocket fees or costs through a contingency fee arrangement.
WHAT TO DO NEXT: To join the Microsoft class action, go to https://rosenlegal.com/cases/microsoft-corporation/join or call Phillip Kim, Esq. toll-free at 866-767-3653 or email [email protected] for information on the class action. A class action lawsuit has already been filed. If you wish to serve as lead plaintiff, you must move the Court no later than August 11, 2026. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation.
WHY ROSEN LAW: We encourage investors to select qualified counsel with a track record of success in leadership roles. Often, firms issuing notices do not have comparable experience, resources, or any meaningful peer recognition. Be wise in selecting counsel. The Rosen Law Firm represents investors throughout the globe, concentrating its practice in securities class actions and shareholder derivative litigation. Rosen Law Firm has achieved, at that time, the largest ever securities class action settlement against a Chinese Company. Rosen Law Firm was Ranked No. 1 by ISS Securities Class Action Services for number of securities class action settlements in 2017. The firm has been ranked in the top 4 each year since 2013 and has recovered hundreds of millions of dollars for investors. In 2019 alone the firm secured over $438 million for investors. In 2020, founding partner Laurence Rosen was named by law360 as a Titan of Plaintiffs’ Bar. Many of the firm’s attorneys have been recognized by Lawdragon and Super Lawyers.
DETAILS OF THE CASE: According to the lawsuit, throughout the Class Period, defendants made false and/or misleading statements and/or failed to disclose that: (1) Microsoft’s Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; (2) Microsoft’s flagship proprietary AI model ranked well below competitors on a number of benchmark tests; (3) Microsoft needed to increase by billions of dollars its capital expenditures and divert graphics processing unit (“GPU”) and central processing unit (“CPU”) capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related research and development (“R&D”); and (4) as a result, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and Microsoft’s Copilot offerings had lost market share to rival products, a trend that was increasing. When the true details entered the market, the lawsuit claims that investors suffered damages.
To join the Microsoft class action, go to https://rosenlegal.com/cases/microsoft-corporation/join or call Phillip Kim, Esq. toll-free at 866-767-3653 or email [email protected] for information on the class action.
No Class Has Been Certified. Until a class is certified, you are not represented by counsel unless you retain one. You may select counsel of your choice. You may also remain an absent class member and do nothing at this point. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff.
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Contact Information:
Laurence Rosen, Esq.
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The Rosen Law Firm, P.A.
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Microsoft (MSFT 1.43%) has not performed well over the past year. One issue the company has encountered is the perception that some of its products and services will be replaced by artificial intelligence (AI). That makes it hard for Microsoft to justify its heavy capex spending, since, if it is unable to keep up with AI, revenue growth will eventually drop even as expenses rise, leading to shrinking margins and profits. However, what if the tech leader is in a much better position than many investors think? Recent comments from Nvidia's (NVDA 2.16%) CEO, Jensen Huang, suggest that this is the case. Let's look into what Huang said and what it could mean for Microsoft and its shareholders.
Image source: The Motley Fool.
Evolving with AI Huang has been bullish on the next stage in the AI revolution: Agentic AI, or autonomous systems that can organize, plan, and execute tasks. AI agents go beyond the question-response model we see with chatbots. They could significantly transform practically every sector and industry. Agentic AI, though, poses a significant threat to software companies, or so the sentiment goes. Huang disagrees. Speaking at a recent international information technology show in Taiwan, Computex, the founder of Nvidia said:
A lot of people have said, 'Jensen, AI is coming. Agentic AI is coming. Therefore, all of the software companies are going to go out of business.' I said it's exactly the opposite.
Huang also said that it is an "incredible" time to be a software company, suggesting that not only will AI not replace the products and services of top players in the industry like Microsoft, but that it could actually improve them. It's worth noting that we have already seen this movie play out. One of the first companies whose business many thought would be destroyed by AI was Alphabet (GOOG +1.09%) (GOOGL +1.10%). Many believed that its search engine would become obsolete in the age of AI, leading to decreased traction and significantly lower advertising sales.
Exactly the opposite happened. Alphabet incorporated AI into its search engine through AI mode and AI overviews. This helped the company increase engagement and, if anything, AI was a boost to its business, leading to higher revenue. Could we see something similar with Microsoft? The company has already incorporated AI into its services. For instance, Microsoft 365 Copilot integration embeds various AI tools across the company's famous productivity suite and helps users perform many tasks much more efficiently, including things like analyzing data and summarizing documents.
In all likelihood, Microsoft will continue evolving with AI. The company's impressive track record of innovation and significant free cash flow strongly suggests it can stay ahead of technological revolutions like the one we are currently experiencing.
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Is Microsoft stock a buy? It's worth noting that despite its shares dropping by about 17% over the past 12 months, Microsoft's financial results have generally been strong. In the third quarter of its fiscal year 2026, ending on March 31, the company's revenue increased by 18% year over year to $82.9 billion. Microsoft's Azure and other cloud services revenue climbed 40% compared to the year-ago period. And on the bottom line, the tech leader's adjusted earnings per share came in at $4.27, 21% higher than the year-ago period. Further, the company's cloud backlog was $627 billion at the end of the period, up 99% year over year.
This gives the company significant near-term visibility and suggests that cloud revenue will continue to move in the right direction for the foreseeable future. And importantly, Microsoft's AI business surpassed a $37 billion annual run rate and increased by 123% year over year. This isn't what a struggling company looks like. In fact, Microsoft seems to be doing just fine, if not better. The company still has significant opportunities in AI and cloud computing, two industries where it is a leader.
Further, Microsoft benefits from a strong competitive advantage thanks to its brand name, its long-standing partnerships with millions of businesses, and high switching costs. Meanwhile, the stock is trading at reasonable levels. Microsoft's forward price-to-earnings ratio is currently 20.6, versus an average of 22.3 for information technology stocks. Lastly, Microsoft has a strong dividend program, despite its fairly low forward yield of 0.9%. Given all these factors, Microsoft looks like a steal at current levels. Those who invest in the company today and hold onto their shares for a long time could see outstanding returns.
SANTA CLARA, Calif. and SAN ANTONIO, June 16, 2026 (GLOBE NEWSWIRE) -- AMD (NASDAQ: AMD) and Rackspace Technology® (NASDAQ: RXT), a global enterprise AI infrastructure and solutions provider, today announced the signing of a definitive agreement for the phased deployment of an initial 30 MW footprint dedicated to AMD-based compute deployments across Rackspace's global data centers beginning in late 2026 through 2028. The agreement operationalizes the Memorandum of Understanding announced May 7, 2026, and establishes AMD as a strategic technology partner at the silicon layer of Rackspace's governed AI stack.
At full deployment, 30 MW of dedicated AMD compute across Rackspace's footprint will represent meaningful capacity to serve regulated enterprise workloads, including healthcare providers who have expressed early interest in accelerated compute for clinical AI and inference at scale. This collaboration incorporates both AMD Instinct™ GPUs (including MI355X, MI350P, and future successor solutions) and AMD EPYC™ CPUs inside an integrated Enterprise AI Cloud architecture, enabling Rackspace to route each workload to the right compute with full accountability for performance and outcomes end to end.
“Enterprises in regulated industries need AI infrastructure that is governed from the ground up, with one operator accountable for business outcomes, not a collection of vendors each owning a piece," said Gajen Kandiah, CEO, Rackspace Technology. "This collaboration combines the right compute with the right operating model and delivers something the market hasn't offered before: a governed AI stack with one accountable partner from silicon to outcomes."
“As enterprise AI evolves, customers need infrastructure that can deliver the right mix of accelerated and general-purpose compute for each workload,” said Dan McNamara, senior vice president and general manager, Compute and Enterprise AI, AMD. “By bringing together leadership AMD AI compute solutions and Rackspace’s governed cloud operating model, we are helping regulated enterprises deploy high-performance AI infrastructure with the openness, scalability and accountability needed to run AI at enterprise scale.”
Both companies expect to dedicate sales and marketing resources to identify and engage enterprise customers for AMD compute-powered infrastructure, with each company committing personnel to jointly develop and pursue customer opportunities across regulated industries.
This agreement will accelerate delivery of the four integrated capabilities announced with the MOU: Enterprise AI Cloud, Enterprise Inference Engine, Inference as a Service, and Bare Metal AMD Instinct, offering a complete, governed stack from bare metal compute through fully operated inference. Together, the companies aim to establish a new category of managed enterprise AI infrastructure that offers enterprises an alternative to the bare metal model. The shift from AI experiments to agentic workflows running inside core enterprise systems is accelerating demand for exactly the kind of governed, accountable infrastructure this collaboration is built to deliver.
An investor call has been scheduled for June 16th at 8:30 am ET to provide further remarks by Rackspace Technology's CEO and CFO and to take questions:
Rackspace Investor Call:
Date: 06/16/2026
Start time: 8:30 am EDT
To listen to the live webcast or access the replay following the webcast, please visit: https://edge.media-server.com/mmc/p/jux5yi7s.
To obtain a dial-in number, please pre-register at the following link: https://register-conf.media-server.com/register/BI3bfaa99f000b4fefa9f6c101e4bd7fc8
Registrants will receive dial-in information and a PIN allowing them to access the live call.
About Rackspace Technology
Rackspace Technology® (NASDAQ: RXT) is the operator of the full enterprise AI stack from governed private cloud to AI inference and agents in production. With an Outcomes-as-a-Service model built on secure infrastructure, data foundations, and forward-deployed engineering, Rackspace delivers business results for regulated and mission-critical industries where governance, sovereignty, and uptime are non-negotiable. Learn more at www.rackspace.com.
About AMD
AMD (NASDAQ: AMD) drives innovation in high-performance and AI computing to solve the world’s most important challenges. Today, AMD technology powers billions of experiences across cloud and AI infrastructure, embedded systems, AI PCs and gaming. With a broad portfolio of AI-optimized CPUs, GPUs, networking and software, AMD delivers full-stack AI solutions that provide the performance and scalability needed for a new era of intelligent computing. Learn more at http://www.amd.com.
Forward-Looking Statements
This press release contains forward-looking statements concerning Rackspace Technology and AMD, including without limitation, the ability to deploy 30 MW of AMD AI compute contemplated by the agreement, which may not be achieved in full or at all, or may be achieved on a timeline materially different from that described herein; the anticipated benefits and performance of GPU and CPU compute deployments; the expected delivery of Enterprise AI Cloud, Enterprise Inference Engine, Inference as a Service, and Bare Metal AMD Instinct capabilities; anticipated end-customer demand; the expected commercial and financial benefits of the collaboration to each company; and the parties' respective outlooks on the AI industry. While the parties have executed a definitive agreement establishing a commercial framework for the collaboration, individual deployment authorizations are subject to separate execution and certain commercial terms, including pricing and financial parameters, remain subject to further agreement between the parties. Any third-party financing required to implement planned deployments is subject to availability on terms acceptable to Rackspace in its sole discretion. There can be no assurance that deployments will occur on the anticipated timeline, that financing will be obtained, or that the anticipated benefits of the collaboration will be realized. Forward-looking statements are commonly identified by words such as "aim," "anticipate," "believe," "build," "create," "enable," "envision," "establish," "expect," "explore," "may," "intend," "plan," "position," "project," "to be," "will," "working toward," "would," and other terms with similar meaning and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations, estimates, and assumptions and are subject to risks and uncertainties that could cause actual results to differ materially. For a description of these and other risks and uncertainties, please refer to Rackspace Technology's and AMD's respective filings with the Securities and Exchange Commission, including but not limited to the most recent reports on Form 10-K and Form 10-Q. Forward-looking statements speak only as of the date of this release. Neither company undertakes any obligation to update or revise these statements except as required by law.
AMD AMD jumped more than 6% Monday after buying MEXT, a small but timely bet on one of AI's biggest headaches: memory.
The idea is simple. AI workloads are getting heavier, data centers are getting squeezed, and companies need faster access to data without spending endlessly on expensive DRAM. AMD says MEXT's technology can make flash storage act more like DRAM, which could help customers run AI and data-heavy workloads more efficiently and at lower total cost.
That matters because AMD is not just trying to sell more chips. It is trying to build a fuller AI platform for cloud and enterprise customers, and memory bottlenecks are becoming a major performance issue as models grow larger. The deal also adds engineering talent AMD can use as it scales deeper into data centers.
Investors liked the signal. AMD shares rose to about $545.10, extending a weekly rally. Quantitative models currently rate the stock a Strong Buy with a score of 4.99, while Wall Street analysts remain bullish with an average rating of 4.54.
Prescription Drug User Fee Act (PDUFA) goal date of July 29, 2026 June 16, 2026 08:02 ET | Source: Outlook Therapeutics, Inc.
ISELIN, N.J., June 16, 2026 (GLOBE NEWSWIRE) -- Outlook Therapeutics, Inc. (Nasdaq: OTLK), a biopharmaceutical company focused on enhancing the standard of care for bevacizumab for the treatment of retina diseases, today announced the U.S. Food and Drug Administration (FDA) has acknowledged receipt of the resubmission of the Biologics License Application (BLA) for ONS-5010/LYTENAVA™ for the treatment of neovascular age-related macular degeneration (nAMD), or wet AMD. The Company has been informed that the resubmission is a Class 1 review, with a PDUFA target action date of July 29, 2026.
“We are very pleased that the FDA has accepted our resubmitted BLA to review the labelling as part of the final step toward potential approval,” said Bob Jahr, Chief Executive Officer of Outlook Therapeutics. “This is great news for Outlook and the LYTENAVA™ team, patients and the retina community. We look forward to collaborating with the FDA over the coming weeks. We are incredibly grateful to our teams, partners, and KOLs for their resilience and dedication.”
When approved, ONS-5010/LYTENAVA™ will be the first and only FDA-approved ophthalmic formulation of bevacizumab supported by standardized manufacturing, FDA-approved labeling, and robust pharmacovigilance. Outlook Therapeutics has initiated pre-launch activities in anticipation of the pending BLA approval.
About ONS-5010 / LYTENAVA™ (bevacizumab-vikg, bevacizumab gamma)
ONS-5010/LYTENAVA™ is an ophthalmic formulation of bevacizumab produced in the United States for the treatment of wet AMD. LYTENAVA™ (bevacizumab gamma) is the subject of a centralized Marketing Authorization granted by the European Commission in the EU and Marketing Authorization granted by the Medicines and Healthcare products Regulatory Agency (MHRA) in the UK for the treatment of wet AMD. In certain European Union Member States, ONS-5010/LYTENAVA™ must receive pricing and reimbursement approval before it can be sold.
In the United States, ONS-5010/LYTENAVA ™ (bevacizumab-vikg) is investigational. When approved, it will be the first ophthalmic formulation approved by the FDA.
Bevacizumab-vikg (bevacizumab gamma in the EU and UK) is a recombinant humanized monoclonal antibody (mAb) that selectively binds with high affinity to all isoforms of human vascular endothelial growth factor (VEGF) and neutralizes VEGF’s biologic activity through a steric blocking of the binding of VEGF to its receptors Flt-1 (VEGFR-1) and KDR (VEGFR-2) on the surface of endothelial cells. Following intravitreal injection, the binding of bevacizumab to VEGF prevents the interaction of VEGF with its receptors on the surface of endothelial cells, reducing endothelial cell proliferation, vascular leakage, and new blood vessel formation in the retina.
About Outlook Therapeutics, Inc.
Outlook Therapeutics is a biopharmaceutical company focused on the development and commercialization of ONS-5010/LYTENAVA™ (bevacizumab-vikg, bevacizumab gamma). LYTENAVA™ (bevacizumab gamma) is the first ophthalmic formulation of bevacizumab to receive European Commission and MHRA Marketing Authorization for the treatment of wet AMD. Outlook Therapeutics commenced commercial launch of LYTENAVA™ (bevacizumab gamma) in Germany, Austria, and the UK as a treatment for wet AMD.
Forward-Looking Statements
This press release contains statements that may or are considered “forward-looking statements”. All statements other than statements of historical facts are “forward-looking statements,” including those relating to future events. In some cases, you can identify forward-looking statements by terminology such as “can,” “potential,” “target,” when, or “would”, the negative of terms like these or other comparable terminology, and other words or terms of similar meaning. These include, among others, plans for continued engagement with the FDA and the potential to agree on a regulatory pathway for ONS-5010, the potential of ONS-5010/LYTENAVA™ as a treatment for wet AMD, the potential for ONS-5010 to receive approval from the FDA, and other statements that are not historical fact. Although Outlook Therapeutics believes that it has a reasonable basis for the forward-looking statements contained herein, they are based on current expectations about future events affecting Outlook Therapeutics and are subject to risks, uncertainties, and factors relating to its operations and business environment, all of which are difficult to predict and many of which are beyond its control. These risk factors include those risks associated with developing and commercializing pharmaceutical product candidates, risks in obtaining necessary regulatory approvals, the content and timing of decisions by regulatory bodies, as well as those risks detailed in Outlook Therapeutics’ filings with the Securities and Exchange Commission (the SEC), including its Annual Report on Form 10-K for the fiscal year ended September 30, 2025, filed with the SEC on December 19, 2025, as updated by the Outlook Therapeutics’ subsequent filings, which include uncertainty of market conditions and future impacts related to macroeconomic factors, including as a result of global geopolitical conflict, tariffs and trade tensions, fluctuations in interest rates and inflation, and potential future bank failures on the global business environment. These risks may cause actual results to differ materially from those expressed or implied by forward-looking statements in this press release. All forward-looking statements included in this press release are expressly qualified in their entirety by the foregoing cautionary statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Outlook Therapeutics does not undertake any obligation to update, amend, or clarify these forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities law.
AMD acquired MEXT to address AI memory constraints, potentially expanding effective memory capacity by 2x-4x without new hardware. Management doubled server CPU TAM from $60 billion to over $120 billion as agentic AI increases memory-intensive workloads. AMD is building a photonics ecosystem through Enosemi, Ayar Labs, and GlobalFoundries to secure future CW laser supply.
Advanced Micro Devices (AMD - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.
Shares of this chipmaker have returned +30% over the past month versus the Zacks S&P 500 composite's +2.1% change. The Zacks Computer - Integrated Systems industry, to which Advanced Micro belongs, has gained 37.1% over this period. Now the key question is: Where could the stock be headed in the near term?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Revisions to Earnings EstimatesRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
Advanced Micro is expected to post earnings of $1.60 per share for the current quarter, representing a year-over-year change of +233.3%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
For the current fiscal year, the consensus earnings estimate of $7.21 points to a change of +72.9% from the prior year. Over the last 30 days, this estimate has remained unchanged.
For the next fiscal year, the consensus earnings estimate of $11.94 indicates a change of +65.5% from what Advanced Micro is expected to report a year ago. Over the past month, the estimate has changed +2%.
Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, Advanced Micro is rated Zacks Rank #3 (Hold).
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Projected Revenue GrowthEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
In the case of Advanced Micro, the consensus sales estimate of $11.27 billion for the current quarter points to a year-over-year change of +46.7%. The $48.72 billion and $70.19 billion estimates for the current and next fiscal years indicate changes of +40.7% and +44.1%, respectively.
Last Reported Results and Surprise HistoryAdvanced Micro reported revenues of $10.25 billion in the last reported quarter, representing a year-over-year change of +37.8%. EPS of $1.37 for the same period compares with $0.96 a year ago.
Compared to the Zacks Consensus Estimate of $9.85 billion, the reported revenues represent a surprise of +4.09%. The EPS surprise was +5.38%.
The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.
ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.
While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.
The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Advanced Micro is graded F on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Advanced Micro. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.
Shares of Rackspace Technology RXT climbed about 16% in trading on Tuesday after the cloud services provider announced a major infrastructure agreement with Advanced Micro Devices and announced a 15% cut in its global workforce.
The company said it has signed a definitive agreement with AMD for the phased deployment of up to 30 megawatts of dedicated compute capacity across Rackspace's global data-center footprint.
The rollout is expected to begin in late 2026 and continue through 2028.
The partnership is designed to support enterprise AI workloads, particularly in highly regulated industries such as healthcare, where demand for AI-powered applications and large-scale inference capabilities continues to rise.
At full deployment, the dedicated AMD infrastructure is expected to provide substantial computing capacity for customers seeking governed AI environments.
“Enterprises in regulated industries need AI infrastructure that is governed from the ground up, with one operator accountable for business outcomes, not a collection of vendors each owning a piece," said Gajen Kandiah, chief executive officer of Rackspace Technology.
AMD also highlighted the growing need for flexible AI infrastructure among enterprise customers.
“As enterprise AI evolves, customers need infrastructure that can deliver the right mix of accelerated and general-purpose compute for each workload,” said Dan McNamara, senior vice president and general manager of Compute and Enterprise AI at AMD.
Alongside the AMD announcement, Rackspace disclosed a "workforce realignment plan" that will eliminate approximately 15% of its global workforce.
The company said the restructuring is intended to support its strategic transformation into what it describes as an operator for governed enterprise AI.
According to a regulatory filing, the changes will primarily affect legacy service delivery functions, particularly within the company's Public Cloud business, while resources will be redirected toward AI-focused operations.
"This realignment is predominantly driven by the Company's strategic decision to deemphasize certain legacy service delivery functions ... and geographic rationalizations in favor of redeploying resources toward its enterprise AI buildout," Rackspace said.
Most affected employees were notified around June 10, with additional workforce reductions expected over the next six months, depending on local regulations and job functions.
Rackspace estimates one-time restructuring costs of between $14 million and $19 million, largely tied to severance payments, healthcare benefits, and other employee-related expenses.
However, management expects the plan to generate annualized run-rate savings of approximately $75 million to $85 million once fully implemented.
The announcements come amid a dramatic turnaround in investor sentiment toward Rackspace.
Shares have surged more than 500% so far in 2026 as investors increasingly focus on the company's AI cloud ambitions.
Even after the rally, however, the stock remains well below levels reached following its return to public markets in 2020 under Apollo Global Management.
The latest partnership also follows AMD's recent acquisition of memory optimization company MEXT, a move aimed at addressing rising memory costs associated with AI computing.
AMD shares have more than doubled this year as demand for AI processors continues to accelerate.
For Rackspace, the AMD agreement represents another step in repositioning the company away from traditional cloud management services and toward enterprise AI infrastructure.
Investors appeared encouraged by both the growth potential of the AMD partnership and the expected cost savings from the workforce overhaul, sending the stock sharply higher ahead of Tuesday's opening bell.
Advanced Micro Devices AMD shares climbed about 2% in early Tuesday trading after the chipmaker said it acquired MEXT, a company focused on AI-driven memory optimization technology.
AMD said the deal is aimed at addressing memory constraints that have become a growing challenge for AI and data-intensive workloads. Limited memory access can affect performance and increase operating costs as computing demands rise.
AMD said MEXT's technology helps flash storage function more like DRAM, a form of high-speed memory commonly used in servers and computing systems. The company expects the addition to strengthen its AI and data center offerings.
AMD also said MEXT's engineering team will join the company, providing expertise that could support future expansion across enterprise and cloud computing markets. The acquisition is part of AMD's broader effort to enhance infrastructure for AI applications.
Advanced Micro Devices (AMD - Free Report) closed the most recent trading day at $507.29, moving -7.3% from the previous trading session. This move lagged the S&P 500's daily loss of 0.57%. Meanwhile, the Dow gained 0.64%, and the Nasdaq, a tech-heavy index, lost 1.15%.
The stock of chipmaker has risen by 29.99% in the past month, leading the Computer and Technology sector's gain of 2.85% and the S&P 500's gain of 2.14%.
Investors will be eagerly watching for the performance of Advanced Micro Devices in its upcoming earnings disclosure. On that day, Advanced Micro Devices is projected to report earnings of $1.6 per share, which would represent year-over-year growth of 233.33%. At the same time, our most recent consensus estimate is projecting a revenue of $11.27 billion, reflecting a 46.67% rise from the equivalent quarter last year.
For the full year, the Zacks Consensus Estimates project earnings of $7.21 per share and a revenue of $48.72 billion, demonstrating changes of +72.9% and +40.65%, respectively, from the preceding year.
Investors might also notice recent changes to analyst estimates for Advanced Micro Devices. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.01% upward. Advanced Micro Devices currently has a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Advanced Micro Devices has a Forward P/E ratio of 75.86 right now. This denotes a premium relative to the industry average Forward P/E of 27.36.
Investors should also note that AMD has a PEG ratio of 1.38 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Computer - Integrated Systems was holding an average PEG ratio of 1 at yesterday's closing price.
The Computer - Integrated Systems industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 14, placing it within the top 6% of over 250 industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
Nokia announces major expansion of U.S. semiconductor advanced test and packaging in Pennsylvania to bolster AI growth
Nokia expands U.S.-based advanced test and packaging operations, critical to the production of photonic chips that will power AI-native networks, with lower power consumption and greater operational efficiency. Investment strengthens U.S. domestic production of critical optical networking technologies powering AI infrastructure.Announcement is part of Nokia's multi-year plan to invest $4 billion in R&D and manufacturing in the U.S. for AI-ready network connectivity. 16 June 2026
Allentown, Pennsylvania – Nokia today announced a major expansion of its advanced test and packaging (ATP) operations in Allentown, Pennsylvania. The investment will increase domestic production capacity of the optical networking technologies that power scalable AI infrastructure connectivity across the United States. The expansion is expected to nearly double Nokia’s Pennsylvania workforce to more than 500 jobs in engineering, manufacturing, and R&D, while generating a projected economic impact of more than $500M over the next five years.
Today, less than two percent of global semiconductor ATP takes place in the U.S. Nokia’s Allentown facility is one of only a few in the U.S. providing ATP of photonic chips into optical modules for use in AI and telecom infrastructure. Through investment in new manufacturing equipment and an expanded manufacturing footprint, Nokia is increasing the site’s production capacity by up to 10 times its current level, with new capacity expected to be commercially available by the end of the third quarter.
Nokia’s optical technologies provide advanced connectivity solutions for telecom networks to enable AI infrastructure and can reduce energy usage by as much as 75 percent. Nokia’s investment results in the domestic manufacturing of components used in AI infrastructure, creates new jobs, and significantly reduces energy usage in AI communications.
“The AI supercycle is fundamentally reshaping network and infrastructure requirements in the U.S. and globally. Our expansion in Allentown is a direct investment in that future—scaling domestic manufacturing of the optical networking technologies that power AI infrastructure. It also reflects the strong partnership between Nokia, the United States, and the Commonwealth of Pennsylvania to support advanced manufacturing, create jobs, and strengthen U.S. technology leadership and global competitiveness,” said Justin Hotard, President and CEO of Nokia.
“Nokia is doubling down on the Lehigh Valley and ensuring that the future of chip production continues to run through this region because we’ve made smart investments to make Pennsylvania more competitive and proven that our Commonwealth is a great place to do business,” said Governor Shapiro. “As demand for semiconductors continues to grow across industries, we’ll continue to position Pennsylvania as a leader in innovation, with a supportive, thriving business climate that helps companies compete on a global scale. From advanced manufacturing to the research and development of new technology like advanced chip packaging, Pennsylvania has all the resources to be a world leader in chip production.”
“This is great news for Pennsylvania. Nokia is doubling its local workforce to more than 500 good-paying jobs in engineering, manufacturing, and R&D, all while expanding our ability to domestically produce the critical technologies that power AI infrastructure. This matters for both our economy and our national security,” said Senator Dave McCormick. “These technologies also help cut energy use in AI communications, showing that we can lead on innovation while also smartly managing our resources at the same time.”
“Nokia’s investment in Pennsylvania is directly advancing America’s AI leadership,” said Bill Frauenhofer, Executive Director of Semiconductor Investment and Innovation at the Department of Commerce. “Supported by CHIPS and Science Act funding, Nokia is deepening its commitment to innovation and the production of photonic chips in the United States. This project enables critical optical technology and strengthens America’s semiconductor supply chain.”
“Nokia’s latest investment is further proof that the Lehigh Valley is becoming a world leader in advanced manufacturing,” said U.S. Congressman Ryan Mackenzie. “With the help of our unparalleled, highly-skilled workforce, Nokia’s local expansion will help our region continue to drive innovation and build the tools behind next-generation technologies. Congratulations to Nokia and the hundreds of local workers who will benefit from this investment.”
The investment includes approximately $30 million from Nokia, which includes bipartisan support of approximately $4 million in assistance from the state of Pennsylvania and approximately $10 million in federal CHIPS investment tax credit. This expansion is part of Nokia's multi-year plan to invest $4 billion in R&D and manufacturing in the U.S. for AI-ready network connectivity. It is designed to bolster domestic supply chains for critical communications infrastructure, reinforce U.S. leadership in the technologies shaping the global AI economy and solidify Pennsylvania’s growing role as a hub for advanced manufacturing, telecommunications technology and AI infrastructure.
About Nokia
Nokia is a global leader in connectivity for the AI era. With expertise across fixed, mobile, and transport networks, we’re advancing connectivity to secure a brighter world.
Alibaba is moving deeper into robots and AI agents, marking a sharp turn in the artificial intelligence race that was dominated only recently by chatbots.
The Chinese e-commerce and cloud giant on Tuesday unveiled its first full suite of AI models built for robots, a move that signals where large technology companies now see the next commercial prize.
Chatbots helped consumers talk to machines and Alibaba now wants machines to act in the real world.
The shift signals a broader change for investors, developers and businesses, as AI’s centre of gravity moves from conversation to execution.
The chatbot boom was built around one powerful idea: ask a question and get a useful answer.
That changed search, customer service, coding and office work. But it also left limits as most chatbots still wait for a human prompt.
They respond, explain, summarise or draft. They rarely complete an entire job on their own.
AI agents are designed to go further. They can plan, use tools, call other software, remember steps and complete multi-stage tasks with less supervision.
In simple terms, chatbots answer questions; agents run workflows. That could mean booking a flight, preparing a sales report, managing supplier orders, updating spreadsheets, or coordinating a factory process.
This is why Alibaba’s pivot matters. It is not just adding another model to a crowded chatbot market, but trying to build AI that can plug into commerce, logistics, cloud services and industrial systems.
Marc Einstein, research director at Counterpoint Research, told CNBC that AI agents could “upend traditional Internet business models,” warning that “if this happens the consequences for those who are not prepared will be severe.”
Alibaba is not alone as ByteDance, Zhipu AI, Baidu and other Chinese AI players are also pushing beyond chatbots, showing that this is becoming an industry-wide reset rather than one company’s experiment.
Alibaba’s new robot AI models are aimed at giving machines a better understanding of the physical world.
That means helping robots identify objects, understand space, plan movements and carry out tasks in environments such as kitchens, warehouses and factory floors.
The push builds on earlier work from DAMO Academy, Alibaba’s research arm, including RynnBrain, an embodied AI model designed for physical reasoning, navigation and task planning.
In simple words, this is AI that is not limited to text on a screen, but is meant to help machines see where things are, understand what they are for, and decide what to do next.
Alibaba has also been strengthening the software and hardware stack around this strategy.
Its Qwen3.7-Max model, introduced in May, was built for the “agent era” and is designed to handle long, complex tasks.
Alibaba said the model sustained a 35-hour autonomous run involving more than 1,000 tool calls, a sign that the company is trying to improve reliability over long workflows rather than just chatbot fluency.
The company has also unveiled the XuanTie C950, a 5-nanometre RISC-V processor designed for agentic AI workloads.
That matters because agents are more demanding than chatbots as they need memory, coordination and repeated interaction with tools and data systems.
Alibaba’s broader pitch is that it can operate across the whole AI chain: chips, cloud infrastructure, foundation models, platforms and consumer or enterprise applications.
That gives it a route to monetise AI in more places than a standalone chatbot app.
CEO Eddie Wu has framed the opportunity in sweeping terms, arguing that there may one day be more agents and robots than people.
Alibaba (BABA, Financials) is moving its AI push beyond chatbots and into robotics. The company launched a new group of AI models built to help robots understand the physical world and complete real-life tasks.
That could include work in factories, warehouses, delivery systems or other business settings where automation is becoming more important.
The move shows where the AI race is heading next. Companies are no longer focused only on text, images and digital assistants. They are also trying to bring AI into machines that can see, move and act in the real world.
For Alibaba, robotics could become another way to use its AI research across commerce, logistics and cloud customers. The opportunity is still early, but it fits naturally with the company's large e-commerce and supply chain businesses.
For investors, the key question is whether Alibaba can turn these models into practical products and paying customers, not just research headlines.
Alibaba Group Holding Limited (NYSE:BABA) traded lower on Tuesday due to company-specific pressure from regulatory warnings and U.S. geopolitical scrutiny.
Regulatory And US Scrutiny Pressure AlibabaAlibaba fell almost 3% as traders weighed increased public scrutiny from Chinese regulators over e-commerce promotions and broader concerns about price wars among China’s internet giants.
Investors are watching whether competition forces retailers to absorb losses and adds pressure to China’s consumer economy.
Alibaba also remains on a U.S. Pentagon list that blocks the Defense Department from contracting directly with listed companies starting later this month and bars third-party procurement beginning in June 2027.
RobotSuite Adds Longer-Term AI AngleAlibaba also announced a new RobotSuite push tied to the Qwen model family. Qwen said RobotSuite aims to help developers build and test robot capabilities faster by packaging tools and workflows around its models.
The update positions robotics as a next-step use case for large models, though traders may view it as a longer-term investment theme rather than an immediate earnings driver.
Technical AnalysisAt $110.00, Alibaba is still in a clear longer-term downtrend, trading 12.1% below its 20-day SMA ($124.81) and 26.6% below its 200-day SMA ($149.53). That “below every major average” setup often keeps rebounds choppy because overhead supply shows up quickly near prior breakdown zones.
The moving-average structure is also bearish: the 20-day SMA is below the 50-day SMA, and the stock has been in a death cross regime since April (with the 50-day SMA below the 200-day SMA). For momentum, the MACD is below its signal line with a negative histogram, suggesting upside pressure is fading from its recent baseline unless buyers can force a trend shift.
From a levels standpoint, the stock is hovering not far above the lower end of its 52-week range ($103.71 low vs. $192.67 high), with a recent swing low in June still shaping trader psychology. A push back toward resistance would need follow-through strong enough to start reclaiming moving averages, not just a one- or two-day bounce.
Earnings & Analyst OutlookLooking further out, the next major catalyst for the stock arrives with the August 28, 2026 (estimated) earnings report.
EPS Estimate: $2.51 (Up from $2.06 YoY) Revenue Estimate: $38.72 Billion (Up from $34.57 Billion YoY) Valuation: P/E of 17.3x (Suggests fair valuation relative to peers) Top ETF ExposureSignificance: Because BABA carries significant weight in these funds, any significant inflows or outflows will likely trigger automatic buying or selling of the stock.
Price Action
BABA Stock Price Activity: Alibaba shares were down 2.96% at $109.22 at the time of publication on Tuesday, according to Benzinga Pro data.
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Citigroup, Inc. (C - Free Report) is experiencing significant momentum with shares recently trading at its highest level in nearly 17 years touching $141.21 in yesterday’s trading session.
The rally reflects renewed investor confidence, driven by improving financial performance and the company's ongoing restructuring efforts. In addition, Citigroup's recent moves, including the sale of its Polish consumer banking business and an increased focus on blockchain-based trading technologies have reinforced optimism about the company's long-term growth prospects, further supporting the stock's recent advance.
Investor sentiment also received a boost from a preliminary U.S.-Iran peace agreement, which lifted financial stocks broadly. The geopolitical development eased concerns over inflation and reduced pressure on interest rates, creating a more favorable environment for banks like Citigroup, Bank of America (BAC - Free Report) and Wells Fargo ((WFC - Free Report) ).
Over the past year, C shares have surged 82.5%, significantly outperforming the industry’s growth of 32.2%. Among its peers, Bank of America shares have risen 26.3% and Wells Fargo has gained 14.7% over the same period.
Price Performance
Image Source: Zacks Investment Research
Following such a sharp run-up, investors are questioning whether Citigroup’s stock still offers meaningful upside or if much of the optimism is already reflected in the stock price. Let us assess C’s investment potential in more detail.
Citigroup’s Performance CatalystsStrategic Transformation: CEO Jane Fraser continues to advance the company’s multi-year strategy to streamline operations and focus on its core businesses. The company announced plans in April 2021 to exit consumer banking in 14 markets across Asia and EMEA.
This week, Citigroup's subsidiary, Bank Handlowy w Warszawie S.A., operating under the Citi Handlowy brand, announced the completion of the sale of its consumer banking business in Poland to VeloBank S.A. This marks the final divestiture of the company's international consumer businesses, excluding the largely completed wind-downs and the well-advanced Banamex divestiture.
As part of this repositioning, the company has made significant progress in Mexico. In April 2026, the company completed the sale of a 22.6% stake in Banamex, following the divestiture of a 25% stake in December 2025, and continues to prepare for a planned initial public offering of its Mexican consumer, and small and middle-market banking businesses.
The company has also streamlined other international operations. In February 2026, Citigroup completed the sale of AO Citibank to Renaissance Capital, completing its exit from Russia. The company had previously divested its China-based onshore consumer wealth portfolio to HSBC China in June 2024 and continues to advance the wind-down of its Korea consumer banking operations.
Speaking at the 2026 Morgan Stanley U.S. Financials Conference, chief financial officer Gonzalo Luchetti emphasized that the bank moved beyond the most intensive phase of its simplification and transformation program and is now positioned to deliver stronger, more sustainable performance.
These initiatives will free up capital and help the company pursue investments in wealth management and IB operations, which will stoke fee income growth. Supported by these initiatives, Citigroup expects revenues to see a 4-5% compound annual growth rate (CAGR) through 2026.
For 2026, the company is targeting 10-11% return on tangible common equity (RoTCE). C expects to reach 11-13% RoTCE, excluding notable items in 2027 and 2028, and then move toward 14-15% RoTCE over the medium term, defined as 2029 to 2031. This outlook reflects management’s belief that C’s business model is becoming simpler, more efficient and better able to translate revenue growth into shareholder value.
Cost-Optimization Initiatives: The company is executing on its plan to cut 20,000 jobs by 2026 and has already reduced headcount by more than 10,000 employees, while focusing on process streamlining and automation to reduce manual touchpoints. Citigroup is increasingly deploying artificial intelligence (AI) tools to support these efforts.
Citigroup plans to invest $5 billion incrementally from 2026 through 2028. These investments will focus on technology, marketing, front-office talent and branch renovations. During the Morgan Stanley 2026 conference, Citigroup’s management highlighted that AI is already producing measurable benefits across the company. In customer service, Citigroup has reduced call times by about 60 seconds using generative AI, while CitiDirect agents have improved containment rates by roughly 50%. In credit cards, AI and machine learning have helped improve approval rates by about 100 basis points. The bank is also continuing to invest in targeted growth areas, including markets, investment banking, wealth, cards and services.
Management also emphasized operating efficiency and cost control, even as it continues investing in growth. Over the near term, Citigroup expects the ratio to decline to 55-60%, excluding notable items, with a medium-term goal of below 55%. Improvement is expected to come from lower transformation costs, reduced stranded costs as Legacy Franchises are exited, productivity gains from prior investments and AI-enabled process re-engineering. Some of these savings will be reinvested in technology, talent and growth initiatives.
Interest Rate Outlook Remains Supportive: NII has been a key contributor to Citigroup’s earnings power, and management expects growth to continue despite a shifting rate environment. Following the initial easing in 2024 and three subsequent rate cuts in 2025, the Federal Reserve has kept interest rates steady so far in 2026. Hence, Citigroup’s NII will continue to grow, given stabilizing funding/deposit costs and improving loan demand.
In first-quarter 2026, NII increased 12% year over year, while NII, excluding Markets, rose 7%. Management expects NII, excluding Markets, to increase 5-6% year over year in 2026.
Liquidity Strength Powers Shareholder Payouts: C enjoys a strong liquidity position. As of March 31, 2026, Citigroup’s cash and due from banks and total investments aggregated to $467.8 billion, while its total debt (short-term and long-term borrowing) was $379.6 billion.
Post-clearing the 2025 stress test, the company hiked its dividend 7.1% to 60 cents per share. In the past five years, it has raised its dividends three times. It has a payout ratio of 26%. The company has a dividend yield of 1.72%. Wells Fargo has raised its dividend six times in the past five years, while Bank of America has increased its dividend five times in the past five years.
In January 2025, Citigroup's board of directors approved a $20-billion common stock repurchase program with no expiration date. As of March 31, 2026, $0.5 billion worth of authorization remained available.
During the Investor Day presentation, the company highlighted that its capital allocation priorities include investing in growth, maintaining dividends in line with shareholder expectations, preparing for different macroeconomic and regulatory scenarios, and returning excess capital through buybacks. The company also noted that its board authorized a $30-billion multi-year common stock repurchase program, expected to begin in the second quarter of 2026. Supported by a strong capital and liquidity position, its capital distribution activities seem sustainable.
C’s Solid Growth Forecast With Attractive ValuationThe Zacks Consensus Estimate for Citigroup’s 2026 and 2027 earnings implies year-over-year rallies of 34% and 16.4%, respectively. Estimates for 2026 and 2027 have been revised upward over the past month.
Estimate Revision Trend
Image Source: Zacks Investment Research
From a valuation standpoint, C trades at a forward price-to-earnings (P/E) ratio of 12.30X, below the industry’s average of 14.28X. Its peers Bank of America and Wells Fargo trade at a forward P/E of 11.79X and 11.44X, respectively.
Price-to-Earnings F12M
Image Source: Zacks Investment Research
Final View on C: A Hold Case With Structural Growth PotentialWhile Citigroup’s valuation remains reasonable relative to the industry, the stock’s sharp run-up limits immediate upside potential. Execution risks tied to restructuring, macroeconomic uncertainty and interest-rate movements also warrant caution.
Nonetheless, Citigroup’s transformation strategy, improving profitability outlook and disciplined capital returns remain encouraging. The bank’s ongoing divestitures, cost-control efforts, AI-led efficiency initiatives and focus on higher-return businesses are expected to support revenue growth over the next several years. Its solid liquidity position, dividend growth and planned buybacks further enhance shareholder value.
Therefore, investors who already own Citigroup’s stock may continue to hold it to benefit from its long-term transformation and capital-return plans. However, new investors may prefer to wait for a better entry point before adding the stock.
Citigroup currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
BEDFORD, Mass.--(BUSINESS WIRE)--Stoke Therapeutics, Inc. (Nasdaq: STOK) is a biotechnology company dedicated to restoring protein expression by harnessing the body's potential with RNA medicine and has a lead investigational medicine, zorevunersen, in development as a first-in-class potential disease-modifying treatment for Dravet syndrome. The Company today announced that, effective on June 15, 2026, it granted stock options to purchase an aggregate of 103,020 shares of common stock to nine n.
