SPCX stock is climbing. See the chart and price action here. Macquarie’s Call and ValuationMacquarie reiterated an Outperform rating on SpaceX and set a $250 price target in a research note on Tuesday.
The analysts rely on a blend of Sum‑of‑the‑Parts and Discounted Cash Flow analysis, tying valuation to both core launch economics and emerging AI compute revenue streams, according to CNBC.
Macquarie emphasizes "significant upside from AI optionality," arguing that even partial realization of SpaceX’s long‑term compute ambitions could justify valuations far above the current price.
Starlink’s global footprint, reusable launch capacity and internal chip and data‑center build‑out underpin a thesis that SpaceX controls scarce, scalable compute and bandwidth for frontier AI workloads. In this view, orbital networks and vertically integrated data centers form a "compute utility" that can compound far beyond launch revenues.
Compute Demand and Bottleneck ReliefMacquarie highlights hyperscale data centers facing escalating power, cooling and land constraints as AI models grow. SpaceX’s proposed orbital AI data‑center system—up to one million satellites using near‑continuous solar power—aims to sidestep some ground‑based limits while lowering energy intensity per unit of compute.
Macquarie’s upside case assumes that if SpaceX captures only a fraction of terminal AI compute demand with this architecture, its revenue and margin profile could support valuations well above current levels.
The firm’s $250 target implies nearly 100% upside from SPCX current level near $127 per share.
Commercial Traction: Colossus and Big Tech DealsThe thesis is already being tested in the market. Anthropic has inked a deal to use all compute capacity at SpaceX’s Colossus 1 data center, securing roughly 300 megawatts of power and more than 220,000 Nvidia GPUs.
These contracts provide early proof of concept for the "rent out unused capacity" strategy and anchor Macquarie’s argument to "buy any dip" as the AI revenue stack scales.
Photo: berni0004 / Shutterstock
This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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The recommendations of Wall Street analysts are often relied on by investors when deciding whether to buy, sell, or hold a stock. Media reports about these brokerage-firm-employed (or sell-side) analysts changing their ratings often affect a stock's price. Do they really matter, though?
Let's take a look at what these Wall Street heavyweights have to say about Toll Brothers (TOL - Free Report) before we discuss the reliability of brokerage recommendations and how to use them to your advantage.
Toll Brothers currently has an average brokerage recommendation (ABR) of 1.78, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 18 brokerage firms. An ABR of 1.78 approximates between Strong Buy and Buy.
Of the 18 recommendations that derive the current ABR, 11 are Strong Buy and two are Buy. Strong Buy and Buy respectively account for 61.1% and 11.1% of all recommendations.
Brokerage Recommendation Trends for TOL
Check price target & stock forecast for Toll Brothers here>>>
The ABR suggests buying Toll Brothers, but making an investment decision solely on the basis of this information might not be a good idea. According to several studies, brokerage recommendations have little to no success guiding investors to choose stocks with the most potential for price appreciation.
Do you wonder why? As a result of the vested interest of brokerage firms in a stock they cover, their analysts tend to rate it with a strong positive bias. According to our research, brokerage firms assign five "Strong Buy" recommendations for every "Strong Sell" recommendation.
In other words, their interests aren't always aligned with retail investors, rarely indicating where the price of a stock could actually be heading. Therefore, the best use of this information could be validating your own research or an indicator that has proven to be highly successful in predicting a stock's price movement.
With an impressive externally audited track record, our proprietary stock rating tool, the Zacks Rank, which classifies stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), is a reliable indicator of a stock's near-term price performance. So, validating the Zacks Rank with ABR could go a long way in making a profitable investment decision.
ABR Should Not Be Confused With Zacks RankIn spite of the fact that Zacks Rank and ABR both appear on a scale from 1 to 5, they are two completely different measures.
Broker recommendations are the sole basis for calculating the ABR, which is typically displayed in decimals (such as 1.28). The Zacks Rank, on the other hand, is a quantitative model designed to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. Because of their employers' vested interests, these analysts issue more favorable ratings than their research would support, misguiding investors far more often than helping them.
In contrast, the Zacks Rank is driven by earnings estimate revisions. And near-term stock price movements are strongly correlated with trends in earnings estimate revisions, according to empirical research.
In addition, the different Zacks Rank grades are applied proportionately to all stocks for which brokerage analysts provide current-year earnings estimates. In other words, this tool always maintains a balance among its five ranks.
Another key difference between the ABR and Zacks Rank is freshness. The ABR is not necessarily up-to-date when you look at it. But, since brokerage analysts keep revising their earnings estimates to account for a company's changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in indicating future price movements.
Is TOL Worth Investing In?In terms of earnings estimate revisions for Toll Brothers, the Zacks Consensus Estimate for the current year has remained unchanged over the past month at $12.69.
Analysts' steady views regarding the company's earnings prospects, as indicated by an unchanged consensus estimate, could be a legitimate reason for the stock to perform in line with the broader market in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Toll Brothers. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
It may therefore be prudent to be a little cautious with the Buy-equivalent ABR for Toll Brothers.
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Shares of Apple (AAPL +0.67%) have been rallying in recent weeks as the company's slow-and-steady approach to artificial intelligence may be winning over investors after all. While there have been concerns that it's been moving too slowly, the stock's recent gains suggest the market isn't all that concerned. Amid the recent rally, it also briefly surpassed Nvidia in terms of market cap. Although it has given back some of its gains, at around $4.8 trillion, it's not far behind the chipmaker's $4.9 trillion valuation.
Apple's stock has hit a new all-time high along the way, and it's up 20% since the start of the year. Has it gotten too expensive, or can this "Magnificent Seven" stock still rise higher?
Image source: Getty Images.
Has Apple benefited from a market rotation? In recent weeks, there's been growing bearishness around many memory and storage stocks, including Micron Technology and Sandisk, which have been generating impressive results due to supply shortages. As their valuations have risen astronomically over the past year, investors appear to be second-guessing those stocks and moving into safer options, such as Apple.
Ironically, however, Apple itself isn't all that cheap. It trades at a price-to-earnings (P/E) multiple of 40, which is a bit rich given that the business hasn't exactly been a growth machine historically. While there have been periods of high growth, Apple's been known more for stability and safety than for generating strong growth. In its most recent fiscal year, which ended on Sept. 27, 2025, revenue rose by a modest 6%, totaling $416 billion. That's not the kind of growth investors typically expect from a stock trading at such a high P/E multiple.
The big test for Apple looms later this month, when it releases its latest quarterly numbers. The bar could be high for the business, given that it's going into earnings with its stock trading at such an elevated valuation.
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Is Apple's stock still worth buying? Apple's business is solid, and it's easy to understand why investors may be gravitating to it in times of fear and uncertainty. But its valuation is also high, and there's no mistaking that. While it can still make for a solid investment in the long run, the risk is that when buying a stock at such high levels, returns can be limited, and it can take much longer to generate a strong return than if the stock were bought at a more modest level.
While it's a good stock, Apple may be a bit too expensive to buy right now. At the very least, I'd wait until after it reports earnings (on July 30), and reassess the tech stock then.
David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Micron Technology, and Nvidia. The Motley Fool has a disclosure policy.
Taking full advantage of the stock market and investing with confidence are common goals for new and old investors, and Zacks Premium offers many different ways to do both.
The popular research service can help you become a smarter, more self-assured investor, giving you access to daily updates of the Zacks Rank and Zacks Industry Rank, the Zacks #1 Rank List, Equity Research reports, and Premium stock screens.
It also includes access to the Zacks Style Scores.
What are the Zacks Style Scores? Developed alongside the Zacks Rank, the Zacks Style Scores are a group of complementary indicators that help investors pick stocks with the best chances of beating the market over the next 30 days.
Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.
The Style Scores are broken down into four categories:
Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.
Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.
Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.
VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank A proprietary stock-rating model, the Zacks Rank utilizes the power of earnings estimate revisions, or changes to a company's earnings outlook, to help investors create a successful portfolio.
It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.94% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.
This totals more than 800 top-rated stocks, and it can be overwhelming to try and pick the best stocks for you and your portfolio.
That's where the Style Scores come in.
To have the best chance of big returns, you'll want to always consider stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B, which will give you the highest probability of success. If you're looking at stocks with a #3 (Hold) rank, it's important they have Scores of A or B as well to ensure as much upside potential as possible.
Since the Scores were created to work together with the Zacks Rank, the direction of a stock's earnings estimate revisions should be a key factor when choosing which stocks to buy.
Here's an example: a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one with Style Scores of A and B, still has a downward-trending earnings outlook, and a bigger chance its share price will decrease too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Apple (AAPL - Free Report) Apple’s business primarily runs around its flagship iPhone. The Services portfolio that includes revenues from cloud services, App store, Apple Music, AppleCare, Apple Pay, and licensing and other services now contributes a significant part of revenues.
AAPL is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.
Momentum investors should take note of this Computer and Technology stock. AAPL has a Momentum Style Score of A, and shares are up 10% over the past four weeks.
Three analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $0.02 to $8.76 per share. AAPL also boasts an average earnings surprise of +7.3%.
With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, AAPL should be on investors' short list.
Apple is launching a device leasing program called 'Apple Upgrade' on July 28 in the U.S. to boost sales, Bloomberg News reported on Tuesday, citing people with knowledge of the matter.
It's been a tumultuous year for Meta Platforms (META +0.26%) investors. Despite the company's strong underlying ad revenue and user engagement metrics, the stock has been under meaningful pressure.
While the stock at one point cratered by as much as 20%, shares are now down just 2% year to date -- showing some degree of resilience as capital continues rotating toward companies that are viewed as clearer artificial intelligence (AI) infrastructure winners. With its next earnings reported scheduled for July 29, I predict Meta CEO Mark Zuckerberg will take that opportunity to announce a major strategic shift that could reframe Meta's role in the AI economy.
Image source: Getty Images.
Meta's AI spending is crushing its free cash flow Meta's stock has been under pressure this year for one reason: the scale of its AI investments. The company is deploying unprecedented sums to build data centers, design custom silicon, and procure GPU clusters to support its AI initiatives.
Those capital expenditures have compressed its free cash flow in the near term. Investors are growing increasingly concerned about the potential timeline for Meta to deliver meaningful returns on this capital, especially amid questions about how AI will be monetized across the broader tech sector.
The result is a disconnect between Meta's operational performance and its stock price, as the market demands more visibility into how these infrastructure investments will ultimately drive sustained profitability rather than just consume it.
META Capital Expenditures (TTM) data by YCharts.
AI is already transformative for Meta Over the last few years, Meta has done a respectable job of embedding AI into its advertising empire. New tools such as Advantage+ use machine learning to automate campaign optimization, audience targeting, and creative testing. This has brought measurable efficiency gains for advertisers while boosting Meta's own average revenue per user. AI-enhanced advertising is becoming an expanding slice of the company's overall business, underscoring Meta's ability to integrate frontier technology directly into its highest-margin segment.
What investors may be overlooking is that this same infrastructure build-out offers the opportunity for a natural business extension: monetizing some of that data center capacity by leasing compute to external clients. Once the heavy up-front investments in power, networking, and accelerators are made, adoption rates carry high incremental margins.
Leasing spare capacity would diversify Meta's revenue away from the cyclical advertising market, providing it with a more predictable, subscription-like income stream. Moreover, it would transform Meta from a solely consumer platform into a more comprehensive infrastructure enabler for enterprises.
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Zuckerberg should announce a capacity deal on the earnings call The most obvious potential catalyst for a sharp rebound in Meta stock could come from what Zuckerberg chooses to reveal on the earnings call later this month. I think he will announce a significant capacity-leasing agreement with a frontier AI lab such as Anthropic or OpenAI.
Such a move would signal Zuckerberg's broader ambition to transform Meta into a true AI ecosystem rather than simply using the technology to make advertising more precise. By offering high-performance compute to a leading model developer, Meta would create new revenue, deepen strategic relationships beyond its suppliers, and generate network effects as more companies onboard to train and deploy on its infrastructure.
Throughout the AI revolution, investors have rewarded companies that took concrete steps toward ecosystem expansion. A credible announcement on the earnings call could easily trigger a rapid rerating of Meta stock as investors revise their view of the company into one that is no longer just defending its advertising moat, but actively building the rails for the AI infrastructure era.
Finding a bargain is a relative feat. For a growth investor like Cathie Wood, there might be deals in stocks that are slumping despite not yet being textbook cheap. She added to existing Ark positions in Archer Aviation (ACHR 0.85%), Space Exploration Technologies (SPCX +6.48%), and Meta Platforms (META +0.26%) on Monday.
Archer and SpaceX are now trading below their IPO pricing. Meta is faring a bit better than the recent slides at Archer and SpaceX, but the Facebook parent company is still trading 8% lower over the past year.
Let's take a closer look at the three potentially opportunistic purchases by Ark to kick off the new trading week.
Image source: Getty Images.
1. Archer Aviation One of Monday's biggest winners was Archer Aviation stock. One of the leaders in the development of electric vertical takeoff and landing (eVTOL) aircraft saw its shares soar nearly 20% on its heaviest day of trading volume since late last year after introducing a new revenue stream.
Archer unveiled Thunder -- a Group 5 autonomous attack rotorcraft that it developed alongside Anduril. The Thunder pitch is that it will multiply the combat power of today's crewed attack, assault aircraft, and next-gen offerings.
The challenges for Archer's flagship Midnight eVTOL flying machines before going mainstream fall primarily on the limited flight range between charges and the tight weight controls. Thunder's lightning could be its stronger range and payload. Archer expects to announce the new platform's first commercial partners later this week.
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A stock surging this week may not seem to vibe with bargain hunting, but zoom out. Even after Monday's pop, Archer's shares have plummeted 60% over the past year. Zoom out to the start of Archer's publicly traded life, and it has also surrendered more than half of its value since its IPO five summers ago.
Archer has had a series of wins lately, but the stock chart continues to tell a different story. It's landing potentially lucrative partnerships. The air taxi business that put it on the map is getting that much closer to a potential glow-up moment as the official provider of those services at the 2028 Olympic Games in Los Angeles.
Profitability is still another three to four years away, but top-line growth is expected to ramp up sharply in that time. Here are the current analyst revenue projections for Archer through the next few years:
2026: $10 million 2027: $86 million 2028: $481 million 2029: $1.43 billion With a cash-rich balance sheet shaving its market cap nearly in half to arrive at an enterprise of just $2.3 billion, Archer can weather the deficits as its platform starts to grow as a business. Like its planes, its revenue should take off vertically soon.
Will the shares finally follow suit? Wood seems to think so.
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2. SpaceX Speaking of broken IPOs, SpaceX stock hit another all-time low on Monday. Granted, the shares have been in the market for only 25 trading days, but it's still quite the swoon. The shares have plummeted 47% from their intraday high on their third day of trading.
Ark Invest got in ahead of the IPO, and she has added to that position as the shares rose through the first few weeks of trading. It's not shocking that Wood is buying the dip. "Don't be surprised to see her pick up the pace of her purchases if SpaceX buckles below its IPO price later this summer," I wrote two weeks ago.
I didn't think it would happen this quickly, but the fund manager has a knack for capitalizing on pullbacks in her favorite holdings.
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3. Meta Platforms Meta isn't trading as far from its peak as Archer and SpaceX, but it's been a laggard among the "Magnificent Seven" stocks. The company behind social media sites Facebook, Instagram, WhatsApp, and Threads is trading near its 52-week low rather than its high, and shares have fallen 8% over the past year.
Business isn't slumping. Revenue is accelerating for the fourth consecutive year, with daily active users reaching a record 3.56 billion across its platforms. Unlike Archer and SpaceX, you can make an earnings-based valuation argument in favor of Meta. It's currently trading just shy of 20 times forward earnings.
Meta seems to be perpetually in a courtroom, and there's always the risk that the next generation of online users will favor a rival connectivity hub. It's a risk Wood is comfortable taking on behalf of her investors, and she does have a point.
Item 1 of 2 Meta Quest 3s VR headset and accessories are displayed at the Meta Connect annual event at the company's headquarters in Menlo Park, California, U.S., September 24, 2024. REUTERS/Manuel Orbegozo/File Photo
[1/2]Meta Quest 3s VR headset and accessories are displayed at the Meta Connect annual event at the company's headquarters in Menlo Park, California, U.S., September 24, 2024. REUTERS/Manuel... Purchase Licensing Rights, opens new tab Read more
July 21 (Reuters) - Meta Platforms (META.O), opens new tab said on Tuesday it is adding the Xbox Game Pass starter edition to its Meta Horizon+ subscription service, expanding its gaming offering on Quest virtual reality headsets.
The move deepens Meta's partnership with Microsoft's (MSFT.O), opens new tab Xbox and will give Horizon+ subscribers access to more than 50 Game Pass titles alongside the existing catalog of more than 100 virtual reality games available through the service.
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Meta Horizon+ is a subscription service that gives Quest headset users access to a catalog of VR games, monthly game drops, and exclusive discounts.
Through the Xbox Game Pass starter, Horizon+ customers will also get 10 hours of cloud gaming per month.
Featured Game Pass titles include "Fallout 4", "Fallout 76", "Grounded", "DayZ" and "Overcooked 2".
Meta said it will roll out a gamepad emulator in the coming weeks, allowing Quest Touch controllers to function like an Xbox controller.
In April, Meta raised U.S. prices for its Quest virtual reality headsets, citing higher memory chip and component costs.
Earlier this month, Microsoft said it would cut about 3,200 jobs in its gaming division as part of a broader restructuring aimed at improving returns after years of investment in Xbox, including its acquisition of Activision Blizzard.
Reporting by Rashika Singh in Bengaluru; Editing by Devika Syamnath
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Meta Platforms (NASDAQ:META | META Price Prediction) and Pinterest (NYSE:PINS) both closed Q1 2026 with double-digit revenue growth, yet the businesses behind those beats look nothing alike.
Meta is pouring tens of billions into a superintelligence buildout that already reaches 3.56 billion daily users. Pinterest is a smaller visual discovery platform trying to turn 631 million monthly users into a durable ad engine.
AI Infrastructure Powers One. Visual Search Powers the Other. Meta beat Wall Street with EPS of $10.44 on $56.311 billion in revenue, up 33.08% year over year. Ad impressions climbed 19% while price per ad rose 12%, a rare combo that shows AI-driven targeting is still improving auction dynamics. A $8.03 billion tax benefit tied to U.S. Treasury Notice 2026-7 flattered the headline, so the underlying quarter looks strong but not quite as heroic as the headline suggests.
CEO Mark Zuckerberg framed it as “a milestone quarter with strong momentum across our apps and the release of our first model from Meta Superintelligence Labs.” Reality Labs still bleeds cash at a $4.03 billion operating loss, and capex guidance jumped to $125 to $145 billion for the year.
Pinterest posted $1.008 billion in revenue, up 17.84%, its first quarter above the billion-dollar mark. Rest of World revenue exploded 59% year over year, and Europe added 27%.
Bill Ready keeps hammering the same theme: “Pinterest is where online discovery leads to real-world action.” The catch is a GAAP net loss of $73.6 million, driven by $231.45 million in stock-based comp and a $47.1 million restructuring charge.
A Cash Machine Versus a Turnaround Bet Lens Meta Pinterest Core Bet Personal superintelligence at scale Visual search as commerce funnel Operating Margin (TTM) 40.6% -3.3% Forward P/E 21x 13x Key Vulnerability $125B+ capex digestion Retail ad concentration, SBC dilution Meta is spending like a company chasing a decade-defining platform shift, and it can afford to. Return on equity sits at 32.9%.
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Pinterest carries a leaner sheet after loading up on $980 million in convertible notes and completing $1.946 billion in Class A buybacks, which drained cash from $969M to $378 million. That is an aggressive move for a company still running at a GAAP loss.
The Next Twelve Months Will Decide Everything For Meta, the question is whether ad monetization keeps outrunning capex. Polymarket traders assign a 92.5% probability Meta beats Q2, and analysts carry an average target of $822.69 against a recent price of $644.12.
For Pinterest, I want to see ARPU accelerate beyond the current $1.61 and evidence the AI ads platform actually closes the monetization gap versus larger peers.
Why I Lean Toward Meta for the Long Haul If I have to pick one for a multi-year hold, I take Meta. The combination of 40.6% operating margins, a forward P/E near 21x, and a genuine seat at the superintelligence table is difficult to replicate.
Pinterest fits a different investor: someone comfortable with a smaller, noisier turnaround story where shares have already recovered 11.27% since the May 4 earnings report. I would revisit that view if capex creeps above $145B without matching ad growth, or if Pinterest finally translates its 27% European and 59% Rest of World growth into positive GAAP earnings. Until then, the cash machine wins.
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Meta didn't make the cut. Grab the names FREE today.
Tesla (NASDAQ:TSLA | TSLA Price Prediction) heads into its Q2 2026 earnings report tomorrow as the undisputed laggard of the Magnificent 7. Shares are down 17.82% year to date, badly trailing every other name in the cohort. Our proprietary model says the setup is more constructive than the tape suggests.
Our 24/7 Wall St. Price Target for Tesla The 24/7 Wall St. price target for Tesla is $428.08, implying 15.83% upside from the current $369.57 quote. Our recommendation is buy.
The rating reflects a re-rating pathway from expanding automotive margins, an accelerating Services and Other line, and imminent product catalysts in Cybercab, Semi, and Optimus. Q2 is the near-term trigger; the multi-year AI thesis is the structural driver.
Metric Value Current Price $369.57 24/7 Wall St. Price Target $428.08 Upside 15.83% Recommendation BUY Confidence Level 90% Why Tesla Has Been the Mag 7 Anchor in 2026 Tesla has slid 6.38% in the past week and 7.72% in the past month, sitting well below the 52-week high of $498.83 hit late last year.
In Q1 2026, Tesla reported revenue of $22.387 billion, up 15.78% YoY, and non-GAAP EPS of $0.41 versus a $0.3481 estimate, a 17.78% beat. Automotive gross margin snapped back to 21.1% from 16.2% from a year earlier, and Services and Other revenue jumped 42% to $3.745 billion on 1.28 million FSD subscriptions. Q2 reports July 22 after the close.
The Case for the Bull Scenario Our bull scenario gets Tesla to $487.11 within twelve months, a 31.81% total return. Cybercab volume production at Giga Texas, Tesla Semi volume production, Megapack 3, and the Optimus Fremont line all hit in 2026. FSD subscriptions rose 51% YoY, and Netherlands approval opens the EU.
Prediction markets on Polymarket price a 77.5% probability of a Q2 EPS beat. On 7investing’s AI Investor Podcast, Simon Erickson framed a robotaxi-success DCF at $700 per share, arguing Tesla “can probably double again” if regulators cooperate.
What Could Go Wrong The bear scenario lands at $375.64, barely above today’s price. TSLA trades at 346 trailing earnings and 167 forward. Q1 flagged real headwinds: energy revenue fell 12% YoY, inventory rose to 27 days of supply from 22, regulatory credits are declining, and digital asset losses hit $222 million. Opex is up 37% YoY.
Bulls counter that opex growth reflects deliberate AI R&D and the CEO award SBC, and that $1.95 billion in quarterly R&D is the price of buying Optimus and Robotaxi optionality. Polymarket assigns just a 16% chance of an Optimus release by year-end, so expectations there are already reset lower.
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Tesla didn't make the cut. Grab the names FREE today.
How Tesla Stacks Up Against GM and Rivian General Motors (NYSE:GM) is the traditional-auto counterpoint. GM trades at a P/E near 25 on $185 billion in 2025 revenue, with Q1 2026 EPS of $3.70 beating the $2.62 consensus. GM prints real cash today; Tesla is priced on cash it will earn a decade out. That contrast is why our 24/7 Wall St. price target applies a mega-cap dampener rather than pure growth multiples.
Rivian (NASDAQ:RIVN) is the pure-play EV comp on the other extreme. Rivian’s Q1 2026 revenue was $1.381 billion on 10,365 deliveries, with negative adjusted EBITDA of -$472 million. Rivian has no P/E because it lacks earnings.
Between GM’s 25 P/E and Rivian’s negative one, Tesla’s 167 forward P/E reflects the market pricing a hybrid auto-plus-AI outcome. That framing makes our 24/7 Wall St. price target of $428.08 look reasonable.
The Setup Ahead of Q2 Earnings The 24/7 Wall St. price target is $428.08, the call is buy, and our confidence is 90%. The tipping factor is margin recovery: automotive gross margin snapping back to 21.1% resets the earnings math.
The bullish case strengthens if Q2 confirms the margin trajectory and FSD subscription growth holds above 40% YoY. The bearish case gains ground if energy revenue slips again and inventory days climb further.
Tesla Price Projection 2026 to 2030 Our base case implies a 9.94% annualized return to $593.66 by 2031.
Year 24/7 Wall St. Price Target 2026 $428 2027 $470 2028 $515 2029 $555 2030 $590 These projections assume Tesla executes on Cybercab, Semi, and Optimus ramps while sustaining FSD adoption. Meaningful upside or downside could emerge from Robotaxi geographic expansion or delayed Optimus commercialization.
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Tesla didn't make the cut. Grab the names FREE today.
HomeIndustriesAutomobilesEarnings OutlookEarnings OutlookWall Street wants to see whether Tesla can deliver on its robotaxi and Optimus plansJuly 21, 2026, 10:32 a.m. ET
Tesla’s earnings reports have increasingly been more about big themes than about the numbers themselves.
The carmaker already disclosed that it delivered 480,126 electric vehicles to customers between April and June, with those numbers coming in well ahead of expectations. Tesla also deployed 13.5 gigawatts of energy-storage products, below expectations but an improvement over the previous quarter.
Tesla TSLA is set to report second-quarter earnings on Wednesday, with investors expected to focus less on the company's financial results and more on Chief Executive Elon Musk's outlook for autonomous driving, humanoid robots, and artificial intelligence.
Wall Street expects Tesla to report earnings of about 54 cents per share on revenue of $27.4 billion for the second quarter, according to FactSet.
A year earlier, the company reported earnings of 40 cents per share on revenue of $22.5 billion.
Tesla shares rose around 3.7% on Tuesday ahead of the earnings release as investors positioned for what is expected to be a closely watched update on the company's long-term growth strategy.
The move today comes as Tesla expanded its robotaxi service to Orlando and Tampa.
Tesla launched its robotaxi service in Austin in June last year before expanding to Dallas and Houston earlier this year and Miami this month.
The company has also been conducting supervised testing in California's San Francisco Bay Area.
Investors have questioned the pace of the rollout after Tesla missed several expansion targets.
Musk has responded by saying the company is deliberately taking a cautious approach, arguing that rigorous safety testing—not demand or technology—is the primary constraint on faster deployment.
Analysts expect year-over-year growth in both revenue and earnings following stronger vehicle deliveries during the quarter.
Tesla delivered about 480,000 vehicles in the second quarter, up 25% from a year earlier.
Higher oil prices, buyer incentives, and reduced competition from traditional automakers following the expiration of the $7,500 federal electric vehicle tax credit in September contributed to the increase in sales.
Despite the anticipated improvement in Tesla's automotive business, analysts say the company's valuation is increasingly tied to its artificial intelligence initiatives rather than its core vehicle operations.
Robotaxis and Optimus remain key focusMorgan Stanley analyst Andrew Percoco said investors are likely to pay closer attention to updates on Tesla's robotaxi service and Optimus humanoid robot than to the company's quarterly financial performance.
“Strong auto and energy deliveries improve near-term fundamentals, but we continue to believe Robotaxi and Optimus will be the primary drivers for the stock,” Percoco wrote in a preview note.
“We expect constructive updates across both, though likely not enough to drive a decisive [change in valuation].”
Investors are expected to seek additional details on the pace of the service's expansion.
Market participants are also awaiting further information on the third generation of Optimus, Musk's humanoid robot project, which he has described as having the potential to become one of the company's largest products.
While neither robotaxis nor Optimus currently contribute meaningfully to Tesla's earnings, analysts continue to view both businesses as central to the company's long-term investment case.
Investors are also expected to monitor growth in Tesla's Full Self-Driving subscription business, which currently has 1.3 million subscribers.
Tesla enters the earnings report after recently posting second-quarter sales and delivery figures that exceeded Wall Street expectations.
However, the stock declined following the delivery report, suggesting investors had already priced in strong operating performance.
The market's reaction indicates that exceeding delivery estimates has become the minimum expectation, raising the bar for the earnings release.
Analysts also noted that Tesla's premium valuation increasingly depends on future businesses such as autonomous driving and humanoid robotics rather than near-term automotive earnings.
At the same time, investor enthusiasm surrounding artificial intelligence has shifted toward companies generating immediate financial returns from AI infrastructure, while software- and autonomy-focused businesses have attracted comparatively less attention.
Speculation surrounding potential corporate actions involving SpaceX has also circulated in recent months.
Key Takeaways A TSLA-SPCX merger could unite EVs, AI, robotics, satellites, energy and commercial spaceflight.Shared AI, manufacturing and Starlink capabilities could cut costs and expand connected services.Governance, regulation, valuation and capital risks make collaboration more likely than a merger. Rumors of a potential merger between Tesla, Inc. (TSLA - Free Report) and Space Exploration Technologies Corp. (SPCX - Free Report) have periodically surfaced over the years, fueled by the companies' shared founder, Elon Musk, and their increasingly complementary technology portfolios. While there has been no official indication that such a transaction is under consideration, industry grapevines are abuzz about the possible creation of a next-generation technology powerhouse.
A merger would combine Tesla's leadership in electric vehicles (EVs), energy storage, artificial intelligence (AI) and robotics with SpaceX's dominance in reusable launch vehicles, satellite communications and space infrastructure. The rationale appears compelling on paper, but the financial, governance and regulatory challenges could be equally formidable.
So, what could such a combination mean for investors?
AI and Robotics Could Be the Biggest SynergyBoth Tesla and SpaceX have made AI central to their long-term growth strategies. Tesla is leveraging AI to advance Full Self-Driving, Optimus humanoid robots and autonomous manufacturing, while SpaceX relies heavily on AI-driven navigation, autonomous docking and mission-critical flight systems. A combined entity could consolidate AI research, accelerate product development and reduce duplication in engineering resources. The companies already share technical talent and a culture focused on rapid innovation, making collaboration a natural extension of their existing relationship.
Manufacturing Expertise Could Create EfficienciesTesla has built one of the world's most sophisticated manufacturing operations through automation, vertical integration and continuous process improvements. SpaceX has similarly transformed rocket production by designing reusable launch systems and rapidly scaling Starship manufacturing. Combining expertise in advanced materials, battery technology, factory automation and supply chain management could drive operational efficiencies across both businesses while lowering development costs.
Starlink Could Strengthen Tesla's Connected EcosystemOne of the most tangible opportunities lies in integrating SpaceX's Starlink satellite network with Tesla's expanding ecosystem. Global satellite connectivity could improve vehicle communications in remote areas, enhance autonomous driving capabilities where cellular coverage is limited and support Tesla Energy's distributed power infrastructure. Such integration could also create new subscription-based software and connectivity revenue streams, further diversifying Tesla's business model.
Greater Revenue DiversificationTesla's financial performance remains closely tied to EV demand and energy storage deployments. SpaceX, on the other hand, generates revenues from launch services, Starlink subscriptions and government contracts. A combined company would be less dependent on a single end market, potentially creating a more balanced revenue mix and reducing cyclicality over the long term.
Why Investors Should Remain CautiousDespite the strategic appeal, several hurdles could make such a transaction difficult to execute.
Capital Allocation ConcernsTesla generates significant operating cash flow, while SpaceX continues investing aggressively in Starship and other capital-intensive initiatives that may take years to generate meaningful returns. Long-duration space exploration projects carry substantial execution risks.
Government Relationships Could Complicate the DealSpaceX serves as a critical contractor for NASA, the U.S. Department of Defense and several national security agencies. This could introduce additional disclosure requirements and regulatory oversight that may complicate those relationships. Government agencies may also scrutinize any corporate restructuring involving important aerospace assets.
Governance Risks Would IncreaseElon Musk already leads multiple high-profile companies. Combining Tesla and SpaceX would create one of the world's largest and most complex technology enterprises, spanning automotive manufacturing, AI, robotics, satellite communications, energy storage and space transportation. Investors would likely seek stronger corporate governance, clearer capital allocation priorities and enhanced board oversight to ensure balanced decision-making across such diverse businesses.
Investment TakeawayA Tesla-SpaceX merger would undoubtedly capture investors' attention, creating an unprecedented technology company spanning EVs, AI, robotics, satellite communications, renewable energy and commercial spaceflight.
The potential benefits—including stronger AI capabilities, manufacturing efficiencies, diversified revenue streams and broader technology integration—are compelling. However, investors should not overlook the significant challenges, including valuation complexity, governance concerns, regulatory scrutiny and competing capital allocation priorities.
For now, a full-scale merger appears less likely than continued collaboration. Investors may ultimately see greater value created through expanded partnerships, technology sharing and joint innovation initiatives rather than a formal corporate combination. Until there is tangible evidence of merger discussions, investors should treat industry speculation with caution while focusing on developments that deepen operational ties between Tesla and SpaceX.
Both Tesla and SpaceX carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Tesla Inc (NASDAQ:TSLA) said it will roll out a new software update this summer that lets its Grok AI assistant make phone calls, play music, adjust cabin climate and open the glovebox by voice command.
The update also allows drivers to view and share self-driving statistics through Tesla's mobile app, and gives Navigation the ability to suggest routine destinations and prioritize routes drivers have previously taken.
Other features include the ability to set a desired arrival battery level from the app, upload custom vehicle wraps without a USB drive, and lock rear display controls from the front screen. Tesla's in-car Caraoke feature will add scoring and saved high scores.
The company also plans to add Supercharger name search, queue controls for Apple Music, adjustable zoom for the self-driving visualization display, browser camera and microphone support, and new animations for the Model 3 and Model Y.
Alphabet is releasing three new Gemini models on Tuesday, including its clearest answer yet to Anthropic's lead in cybersecurity, as the company looks to show progress across a product pipeline that has faced delays and mounting competition.
Gemini 3.5 Flash Cyber is designed to detect and patch software vulnerabilities and will initially be available only to governments and trusted partners through a limited-access pilot. Google said the specialized model runs at a lower price per token than larger models.
That could help Google narrow its cybersecurity gap with Anthropic, which has built an early lead in automated code defense.
Google is also launching Gemini 3.6 Flash, which improves coding, multimodal and knowledge-work performance while using up to 17% fewer tokens and costing less per token than the previous model — a meaningful reduction in the cost of running high-volume workloads.
Read more CNBC tech newsElon Musk's Memphis AI empire is the epicenter of the data center backlashAMD launches Helios, its first rack AI system to rival Nvidia, adding Microsoft as newest buyerTSMC is accelerating Arizona factory build-out to capitalize on AI 'megatrend,' CFO saysLeather jacket worn by Nvidia CEO Jensen Huang goes for just under $1 million at Sotheby's auctionGemini 3.5 Flash-Lite, meanwhile, is Google's fastest and least expensive model in the 3.5 family, built for high-volume workloads and smaller tasks within larger AI-agent systems.
The broader lineup reflects Google's bet that price and efficiency can help offset its slower timing in several key product categories.
Artificial Analysis data shows Gemini Flash already undercuts comparable models from Anthropic, OpenAI and Chinese rivals on cost. According to the company, Gemini 3.6 Flash — the stronger of the two new models — is cheaper per task than GPT-5.6 Terra Max, Kimi K3 and Qwen 3.7 Max, while 3.5 Flash-Lite costs just a fraction of that.
The rollout comes on the eve of Alphabet earnings and as Chinese rivals gain momentum. Moonshot AI's Kimi K3 drew enough demand that the company limited new subscriptions and API access because of capacity constraints, while Alibaba is teasing Qwen 3.8 Max, which it said trails only Anthropic's Fable 5 in overall performance.
watch now
That demand highlights the other side of the AI race: Building a competitive model is only part of the challenge. Companies also need enough computing capacity to serve it at scale.
Google has a potential advantage through its custom chips, cloud infrastructure and ability to design models and hardware together, although the company has faced capacity constraints of its own.
Tuesday's model launches come as Google is reportedly developing a specialized chip designed to run Gemini up to 10 times more efficiently, part of a broader push to lower the cost of serving AI.
A Google Cloud spokesperson told CNBC in a statement that its teams are "constantly researching and experimenting with new innovations to deliver maximum performance and efficiency for our users and customers" and that "while not every project moves into production, this rigorous exploration is central to our full stack approach."
"By co-designing our hardware and software from the ground up, we ensure our systems are integrated and highly optimized for real-world workloads," continued the statement.
Google is also offering more visibility into its roadmap after questions about delays. Gemini 3.5 Pro is now being tested with partners ahead of broader availability, while the company has begun its largest-ever pre-training run for Gemini 4.
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Google is releasing new AI models and teasing Gemini 4. Karl Mondon / AFP via Getty Images Google is rolling out some new AI models — but not the one that many were expecting.
The company announced on Tuesday three Gemini models that it said are faster and cheaper to run AI agents, as Google continues to double down on efficiency over raw power.
That's not entirely by choice: Google said that Gemini 3.5 Pro, the new frontier model it originally promised for June, is still in testing. Google also teased Gemini 4, the next big flagship model, although that is not expected for several months.
Of the new models rolling out this week, Google describes 3.6 Flash as the "workhorse" that is better than 3.5 Flash at tasks such as coding. Google said 3.6 Flash reduces token usage — units of text processed by AI — by up to 17% compared to its predecessor, according to analysis from Artificial Analysis Index, a benchmark for comparing AI tools.
Google also unveiled 3.5 Flash-Lite, which it says is its fastest and "most cost-effective" version of its 3.5 model yet.
Then there's 3.5 Flash Cyber, which is designed to find and fix cybersecurity vulnerabilities at a performance level similar to rivals but at a "lower price per token than larger models," Tulsee Doshi, senior director of product management in Google's Gemini group, said in a blog post.
That last part is crucial. Anthropic and OpenAI have both rolled out cybersecurity models in recent months, but it seems that, again, Google is hoping to undercut the competition on cost. Google said Flash Cyber will initially be exclusively available to governments and trusted partners.
With the realization that using lots of tokens doesn't always merit the best results, more companies are reining in their AI spending and turning to more cost-conscious models. That gives Google a strategic opening.
"Companies are already blowing through their annual token budgets, and it's only May," Google CEO Sundar Pichai said earlier this year. "If companies used a mix of Flash and other frontier models, they could save a lot of money."
Google says its new models hit the "sweet spot" of efficiency and power for running agents.
No sign of 3.5 ProGemini 3.5 Pro, Google's next big frontier model, is being tested with partners and will ship it "as soon as it's ready," the company said.
Business Insider reported in June that Google had pushed the targeted release date for 3.5 Pro to July. Bloomberg recently reported the model may have been further delayed.
As of Tuesday, Google hasn't got a single model among the top 10 ranking in the Artificial Analysis leaderboard, which uses a composite benchmark to score models across areas including maths and reasoning.
Google also said on Tuesday that it has begun its "most ambitious pre-training run yet" for Gemini 4, its next major model.
Typically, Google launches these big flagship models at the very end of the year, and it's not yet clear whether the 3.5 Pro will be powerful enough to vault Google back to the bleeding edge in the interim.
However, as companies take a more considered approach to their AI spend and cap their token usage, Google is positioning itself for the moment.
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The models include one that is the company's most powerful and another that is fine-tuned for cybersecurity, as Google competes with rivals like OpenAI and Anthropic.
Alphabet's Google on Tuesday released a trio of cheaper versions of its Gemini AI model, but shared no timing updates for the flagship Pro model that has already seen its launch delayed by several weeks.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of GOOG, AMZN 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.
When Berkshire Hathaway buys a stock, investors notice. After all, Warren Buffett has spent decades building one of the greatest investing records in history by buying exceptional businesses and holding them for years.
That's why Berkshire's decision to build a massive position in Alphabet (GOOGL 0.78%) (GOOG 0.78%) caught Wall Street's attention. In fact, the Oracle of Omaha has confirmed that he initiated the idea, even though the final execution took place largely after his successor took over the helm.
At first glance, the investment in this tech company may seem surprising. After all, Berkshire has generally refrained from investing in technology companies. But looking deeper, Berkshire's investment makes a lot of sense.
Here are three reasons why.
Image source: Getty Images.
Berkshire probably saw a great business before it saw an AI company Many investors think of Alphabet as an artificial intelligence (AI) stock, given the many attributes pointing in that direction. While there's nothing wrong with that view, Berkshire likely saw something different.
Long before Gemini, Alphabet had already built one of the world's strongest companies. Google Search remains the starting point for billions of internet searches. YouTube dominates online video. Android powers most of the world's smartphones, while Google Cloud has become an increasingly important enterprise platform.
Together, these businesses generate enormous amounts of cash every year. For perspective, Alphabet generated $165 billion in operating cash flow in 2025.
That matters because Berkshire Hathaway has never chased exciting technologies for their own sake. It has consistently invested in companies with durable competitive advantages and the financial strength to compound over decades. Alphabet fits that description remarkably well.
AI is likely the icing on the cake.
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Alphabet can afford to keep investing in the future, while others cannot AI has become one of the most expensive technology races in history. Building large AI models requires a significant investment in chips, data centers, electricity, networking, and engineering talent. Worse, the spending doesn't stop after a model launches. Companies must continue investing to improve performance and support growing demand.
As such, Alphabet enters this race with a major advantage. Its existing businesses generate enormous free cash flow, allowing the company to invest tens of billions of dollars in AI infrastructure without putting pressure on its balance sheet.
Conversely, many AI companies need outside funding or rapid commercial success to justify their investments. For instance, OpenAI raised $122 billion in March 2026 to fund its massive expansion.
Alphabet doesn't. It can keep investing through market cycles, giving it more opportunities to improve its technology -- getting it right rather than rushing it through -- while competitors face tougher financial constraints enforced by capital providers. Many times, staying power may prove just as important as innovation in a tech race.
AI strengthens businesses that already dominate their markets One reason investors have become overly optimistic about AI companies is that many of them are still searching for a profitable business model.
But Alphabet doesn't have that problem. Instead of building a business around AI, it uses AI to improve businesses that already reach billions of users.
Better search results create a better user experience. More intelligent recommendations increase engagement on YouTube. Gemini makes Workspace more useful, while AI capabilities help Google Cloud compete for enterprise customers.
In other words, AI doesn't need to create a new business for Alphabet to create value. It only needs to make its already outstanding businesses even stronger. That dramatically lowers execution risk compared with companies whose future depends almost entirely on AI adoption.
Buying a stock simply because Berkshire owns it has never been a sound investment strategy. But buying a great business, preferably at a reasonable valuation, is.
Alphabet combines one of the world's strongest competitive moats with exceptional cash generation and multiple opportunities to monetize artificial intelligence across its ecosystem. More importantly, it has the financial resources to keep investing as AI reshapes the technology industry.
Perhaps that's what Berkshire Hathaway recognized early on. And if you reach a similar conclusion, then buying Alphabet stock may be just a natural outcome.
, /PRNewswire/ -- The Law Offices of Frank R. Cruz continues its investigation of Alphabet Inc. ("Alphabet" or the "Company") (NASDAQ:GOOG) on behalf of investors concerning the Company's possible violations of federal securities laws.
IF YOU ARE AN INVESTOR WHO LOST MONEY ON ALPHABET INC. (GOOG), CLICK HERE TO INQUIRE ABOUT POTENTIALLY PURSUING A CLAIM TO RECOVER YOUR LOSS.
What Is The Investigation About?
On July 16, 2026, Bloomberg news reported that Alphabet's Google is "months behind schedule on delivering Gemini 3.5 Pro, its most powerful flagship AI model" due to the Company's ongoing coding efforts. Specifically, "[l]ate last month, Google updated the data being used to train Gemini in an attempt to improve [its] skills, but the results were disappointing."
On this news, Alphabet's stock price fell $16.40, or 4.4%, to close at $353.81 per share on July 16, 2026, thereby injuring investors.
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The bar is higher for technology heading into the new earnings season, says Liz Ann Sonders of @CharlesSchwab. She tells investors to keep an eye on the reaction to AI spending figures compared to ROI, particularly as Alphabet (GOOGL) reports earnings Wednesday.
Alphabet (NASDAQ:GOOG | GOOG Price Prediction) reports Q2 after the bell on July 22. Apple (NASDAQ:AAPL) follows on July 30.
Both delivered blockbuster last quarters: Google leaned into AI infrastructure and Cloud, while Apple rode an iPhone 17 supercycle and a Services record. The setup makes this a rare moment to weigh two mega-caps running very different playbooks.
Cloud AI Carries Google. iPhone 17 Carries Apple. Google’s Q1 FY2026 landed at $109.90 billion in revenue, up 21.79% year over year, with EPS of $5.11 versus a $2.6327 estimate. Cloud grew 63% to $20.03 billion, with backlog nearly doubling quarter on quarter to over $460 billion.
Sundar Pichai told investors, “Our AI investments and full stack approach are lighting up every part of the business.” Search grew 19%, and Gemini now processes 16 billion tokens per minute via direct API, up 60% from the prior quarter.
Apple’s March quarter came in at $111.184 billion, up 16.6% YoY, with EPS of $2.01 against a $1.94 consensus. That is Apple’s eighth consecutive EPS beat.
iPhone revenue hit $56.99 billion on iPhone 17 demand, Services set an all-time high at $30.98 billion, and Greater China rebounded to $20.50 billion. Tim Cook called it “our best March quarter ever”.
Reinvesting Machine vs. Cash Return Engine Google is spending as if compute scarcity never ends. CapEx more than doubled to $35.67 billion in Q1, up 107.44% YoY, and 2026 guidance targets $175 billion to $185 billion. Free cash flow collapsed to $10.12 billion, down 46.63% — the tuition bill for industrial-scale AI.
Lens Alphabet Apple Core Bet AI compute, Cloud, Gemini iPhone cycle, Services flywheel Capital Move $175B-$185B CapEx $100B buyback Key Risk FCF pressure, ROI on CapEx China exposure, tariffs Apple runs the opposite play. It authorized a fresh $100 billion buyback and raised its dividend 4% to $0.27. The installed base sits above 2.5 billion active devices, feeding Services’ recurring flywheel. Gross margin holds near 46.9%.
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Apple didn't make the cut. Grab the names FREE today.
The Next Reports Will Test Both Theses Tomorrow’s Alphabet release should show whether Cloud backlog keeps building and whether the CapEx surge is converting into incremental Cloud revenue rather than depreciation.
YouTube ads at 11% growth and a declining Google Network are the softer edges. Retail is leaning in: composite sentiment rose 18.04 points over 30 days.
For Apple on July 30, the question is whether iPhone 17 demand carries through the summer and whether Greater China’s rebound sticks. Services momentum matters most for the long thesis. Reddit sentiment reads bullish at 61, but prediction market signal is thin.
Why I Lean Alphabet Into This Earnings Report Alphabet looks better positioned. A $460 billion Cloud backlog is a contract-backed tailwind, and shares have actually pulled back 4.38% over the past month even as buzz built.
Apple looks pricier after a 20.47% run since its April 30 filing, and a 43 P/E leaves little cushion for a soft services line.
If you prize a fortress balance sheet and predictable capital returns, Apple still fits. If you want the more direct AI infrastructure bet with a catalyst tomorrow, Alphabet is the sharper setup for me.
The one scenario that would flip my view: a Cloud growth deceleration alongside another CapEx step-up. That combination would make me question the ROI narrative and send me back to Apple’s cash machine.
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Apple didn't make the cut. Grab the names FREE today.
LOS ANGELES, July 21, 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.
, /PRNewswire/ -- The Gross Law Firm issues the following notice to shareholders of Microsoft Corporation (NASDAQ: MSFT).
Shareholders who purchased shares of MSFT during the class period listed are encouraged to contact the firm regarding possible lead plaintiff appointment. Appointment as lead plaintiff is not required to partake in any recovery.
ALLEGATIONS: The complaint alleges that during the class period, Defendants issued materially false and/or misleading statements and/or failed to disclose that: (a) Microsoft's Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; (b) Microsoft's flagship proprietary AI model ranked well below competitors on a number of benchmark tests; (c) Microsoft needed to increase by billions of dollars its capital expenditures and divert GPU and 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 R&D; and (d) as a result of (a)-(c) above, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and the Company's Copilot offerings had lost market share to rival products, a trend that was increasing.
DEADLINE: August 11, 2026 Shareholders should not delay in registering for this class action. Register your information here: https://securitiesclasslaw.com/securities/microsoft-corporation-loss-submission-form/?id=194976&from=4
NEXT STEPS FOR SHAREHOLDERS: Once you register as a shareholder who purchased shares of MSFT during the timeframe listed above, you will be enrolled in a portfolio monitoring software to provide you with status updates throughout the lifecycle of the case. The deadline to seek to be a lead plaintiff is August 11, 2026. There is no cost or obligation to you to participate in this case.
WHY GROSS LAW FIRM? The Gross Law Firm is a nationally recognized class action law firm, and our mission is to protect the rights of all investors who have suffered as a result of deceit, fraud, and illegal business practices. The Gross Law Firm is committed to ensuring that companies adhere to responsible business practices and engage in good corporate citizenship. The firm seeks recovery on behalf of investors who incurred losses when false and/or misleading statements or the omission of material information by a company lead to artificial inflation of the company's stock. Attorney advertising. Prior results do not guarantee similar outcomes.
CONTACT:
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Microsoft and Mistral have expanded their partnership to offer organizations across Europe and other regulated markets access to frontier artificial intelligence together with the ability to retain control over their data, operations and critical workloads.
The partnership brings Mistral’s AI models across Microsoft’s AI platform, with Mistral Medium 3.5 and OCR 4now available in Microsoft Foundry, and Mistral Medium 3.5 now in Microsoft Copilot Studio, the companies said in a Tuesday (July 21) press release.
With access to these offerings, organizations can select from Mistral’s frontier, efficient and multilingual models and from flexible deployment options that range from cloud to fully disconnected environments, according to the release.
The partnership also includes a new multibillion-dollar agreement to expand AI infrastructure in Europe. The agreement will see Mistral increasing its compute availability by adding thousands of GPUs, and Microsoft expanding its capacity footprint in Europe and supporting the European Digital Commitments it announced in 2025, per the release.
The European Digital Commitments announced by Microsoft in April 2025 include building a broad AI and cloud ecosystem across Europe, upholding Europe’s digital resilience even when there is geopolitical volatility, continuing to protect the privacy of European data, helping to protect and defend Europe’s cybersecurity, and helping to strengthen Europe’s economic competitiveness.
In June 2025, Microsoft introduced its sovereign public cloud offering for all European data center regions, saying this offering keeps the data in Europe, complies with European laws and is controlled by European personnel.
Microsoft Vice Chair and President Brad Smith said in the Tuesday press release: “By bringing Mistral’s frontier European models into our sovereign cloud portfolio and enabling them across public cloud, cloud-connected and fully disconnected environments, we are honoring the European Digital Commitments we made and giving customers a trusted foundation for AI they can operate on their own terms.”
Mistral Co-founder and CEO Arthur Mensch said in the release: “With Microsoft as our partner, our models reach enterprises and public institutions at global scale — delivered through a platform trusted for the most demanding, regulated workloads and available everywhere our customers operate.”
Mistral announced in February that it plans to invest $1.4 billion to construct new data centers in Sweden, marking the company’s first facility of that kind outside France, its home country.
LOS ANGELES, July 21, 2026 (GLOBE NEWSWIRE) -- The Portnoy Law Firm advises Microsoft Corporation, (“Microsoft” or the "Company") (NASDAQ: MSFT) investors of a class action on behalf of investors that bought securities between May 1, 2025 and January 28, 2026, inclusive (the “Class Period”). Microsoft investors have until August 11, 2026 to file a lead plaintiff motion.
Key Takeaways Amazon's AWS growth is backed by Trainium chips, Bedrock upgrades and a diversified earnings base.MSFT is expanding Azure AI offerings but faces rising capital spending and softer cloud margins.AMZN trades at a lower forward P/S than Microsoft and has outperformed it year to date. Amazon (AMZN - Free Report) and Microsoft (MSFT - Free Report) sit atop the global cloud computing hierarchy, each channeling record capital into artificial intelligence infrastructure to capture enterprise workloads shifting to the cloud. Amazon Web Services and Microsoft Azure remain the two largest cloud platforms worldwide, and both companies have used recent product launches to reinforce their positions as the default infrastructure layer for generative and agentic AI.
The two stocks warrant a side-by-side look right now because both are entering a pivotal stretch of AI monetization, backed by aggressive infrastructure spending, expanding model partnerships and enterprise demand that continues to outstrip available capacity. Yet each company is approaching the opportunity from a different starting point, with distinct guidance, cost structures and growth trajectories.
Let's delve deep and closely compare the fundamentals of the two stocks to determine which one is a better investment now.
The Case for AMZN StockAmazon's cloud arm continues to demonstrate that scale and innovation can move together. In the first quarter of 2026, AWS delivered operating income of $14.2 billion, with management attributing the strength to broad customer demand alongside efficiency gains from custom Trainium chips, which now underpin the majority of Amazon Bedrock workloads. This combination lets Amazon absorb rising component costs while still expanding margins, a favorable setup few cloud rivals can match at similar scale.
Amazon's roadmap reinforces this momentum. At recent AWS Summit events, the company introduced Amazon Bedrock's fully managed Knowledge Bases, an Agentic Retriever for complex enterprise queries, and Web Search on Bedrock AgentCore, extending its agentic AI stack well beyond simple model hosting. AWS also deepened its partnership with OpenAI, bringing GPT-5.5 and Codex to Bedrock, giving customers more model choice without leaving Amazon's ecosystem. New EC2 G7 instances powered by Blackwell GPUs further strengthen AWS' AI compute lineup.
Management has been candid about near-term pressure points, including elevated memory costs and cash capital expenditures of $43.2 billion in the first quarter, mostly directed toward AWS and generative AI capacity. Executives acknowledge a lag of 6 to 24 months between infrastructure spending and revenue monetization, tempering the timeline for payback.
Even so, Amazon's diversified base of retail, advertising and cloud earnings gives it more levers to fund this AI buildout than a single-segment cloud peer, positioning AWS to keep converting capacity investment into durable, long-term growth as enterprise AI adoption widens steadily across its global customer base.
The Zacks Consensus Estimate for AMZN’s 2026 earnings is pegged at $8.93 per share, indicating a 24.55% increase from the figure reported in the year-ago quarter.
The Case for MSFT StockMicrosoft's cloud business remains a formidable growth engine, though its economics look different from Amazon's. In its third quarter of fiscal 2026, Azure and other cloud services revenues grew 40%, with management guiding to 39% to 40% constant-currency growth for the fiscal fourth quarter, citing broad customer demand that continues to exceed available supply. Microsoft's commercial remaining performance obligations reached $627 billion, underscoring a substantial multiyear revenue backlog.
Recent announcements show Microsoft widening its AI platform ambitions. The company confirmed that Anthropic's Claude models now sit alongside OpenAI's GPT models within Microsoft Foundry, giving enterprise customers added model flexibility. Microsoft also committed $2.5 billion and thousands of employees to a new AI implementation unit designed to help customers deploy agentic AI faster, following a similar move by AWS.
That expansion carries a real cost. Fiscal third-quarter capital expenditures and finance leases rose 49% year over year to $31.9 billion, and management has guided to roughly $190 billion in 2026 capital spending, up sharply from the prior year. Gross margin narrowed to its lowest level since 2022 as depreciation from data center buildouts weighed on profitability, and Microsoft Cloud gross margin is guided to soften further next quarter.
Copilot adoption offers a genuine bright spot, with paid seats climbing sharply and usage trends improving across coding, productivity and security workloads. Still, questions persist around whether that momentum, alongside Azure's capacity-constrained growth, can offset mounting depreciation and infrastructure costs quickly enough to preserve Microsoft's historically wide operating margins over the next several quarters.
The Zacks Consensus Estimate for MSFT’s fiscal 2026 earnings is pegged at $17.33 per share. The estimate indicates 27.05% year-over-year growth.
Valuation and Price Performance ComparisonOn valuation, AMZN stock is currently trading at a forward 12-month price-to-sales ratio of 3.04, well below MSFT's 7.75, even as both companies carry premium multiples relative to the broader market. Amazon's comparatively lower premium looks better justified given its diversified retail, advertising and AWS earnings base funding its AI buildout versus Microsoft's steeper multiple resting more heavily on cloud and Copilot monetization.
AMZN vs. MSFT P/S Ratio
Image Source: Zacks Investment Research
Price performance also favors Amazon. Microsoft shares have lost 16.8% year to date, underperforming Amazon's 8.3% gain over the same stretch, reflecting relatively stronger investor confidence in Amazon's near-term execution and its broader AI-driven growth trajectory.
AMZN Outperforms MSFT In 6 Months
Image Source: Zacks Investment Research
ConclusionWeighing both companies together, Amazon holds a modest edge. Its efficient Trainium-powered infrastructure, expanding agentic AI stack, diversified earnings base, and comparatively reasonable valuation offer a more balanced risk-reward setup than Microsoft, whose steep capital spending and narrowing cloud margins introduce near-term uncertainty despite strong Azure growth. Amazon's stronger year-to-date price performance further reflects this relative confidence. Investors would do well to track Amazon stock closely and consider holding it as AWS scales its AI monetization, while staying patient on Microsoft and watching for a more attractive entry point before committing fresh capital, given its currently elevated near-term cost pressures. AMZN currently carries a Zacks Rank #2 (Buy), whereas MSFT has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
New York, New York--(Newsfile Corp. - July 21, 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.
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To view the source version of this press release, please visit https://www.newsfilecorp.com/release/301532
Source: Bronstein, Gewirtz & Grossman, LLC
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HomeIndustriesSoftwareThe Ratings GameThe Ratings GameWall Street is misjudging Microsoft’s AI strategy, according to Morgan StanleyJuly 21, 2026, 12:25 p.m. ET
Microsoft has had trouble convincing investors that it has a winning artificial-intelligence strategy, but they might be looking at the company’s big AI initiatives all wrong, according to a Morgan Stanley analyst.
In assuming coverage of Microsoft with an overweight rating and a $600 price target on Tuesday, Morgan Stanley’s Adam Wood said that Azure and Copilot are “keys to the stock” and “both are set to inflect.” His price target is about 50% above current levels.
For the better part of the current artificial intelligence (AI) supercycle, enterprise infrastructure has operated under a strict single-vendor hardware monopoly. Cloud providers and hyper-scalers had little choice but to buy their accelerator chip from a single dominant supplier, paying premium prices to lock in the computing power they needed. That architectural and economic bottleneck is now actively fracturing.
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The Supply Chain Shake-Up: Diversify or DieA structural shift is underway in the physical economy of data centers. Microsoft Corporation NASDAQ: MSFT has initiated an infrastructure expansion deal utilizing silicon from Advanced Micro Devices NASDAQ: AMD. By locking in this deployment for the second half of 2026, the cloud sector giant is moving decisively to diversify its supply chain.
This is not a simple vendor swap. It represents a fundamental realignment of how enterprise AI infrastructure is built, priced, and scaled, permanently altering the total addressable market for challenger semiconductor firms.
From Components to Complete Compute NodesThe core driver of this supply chain realignment is AMD's rollout of its Helios Rackscale Solution across Microsoft Azure data centers. Historically, hyperscalers purchased discrete GPUs and assembled the surrounding infrastructure themselves, which required significant capital and engineering overhead. The Helios integration marks a transition to buying the whole system as a single package.
Advanced Micro Devices Today
AMD
Advanced Micro Devices
$537.68 +34.11 (+6.77%)
As of 12:31 PM Eastern
This is a fair market value price provided by Massive. Learn more.
52-Week Range$149.22▼
$584.73P/E Ratio176.21
Price Target$468.65
The system physically combines three critical components: Instinct MI455X accelerators, 6th Gen EPYC processors, and Pensando data processing units. By networking these components within an open-source software ecosystem, AMD transitions from a simple parts vendor to a foundational infrastructure partner.
Microsoft is quickly turning this hardware into enterprise compute capacity. Azure is standing up new virtual machines specifically built for frontier AI inference, along with specialized setups tuned for AI agents and demanding chip-design work.
For AMD, this deep integration gives multi-year revenue visibility, locking in durable growth that extends far beyond initial hardware shipments and giving the company a foothold inside the world's top cloud ecosystem.
Protecting Margins in the AI Arms RaceTo understand why this shift is happening now, investors should look at the financial pressures facing hyper-scalers. Market focus is increasingly centered on the return on invested capital for AI infrastructure. Microsoft currently generates a 39.34% net margin and a trailing 12-month earnings per share of $16.80, but sustaining that profitability at a $3 trillion valuation requires strict management of capital expenditures.
Microsoft Today
$397.99 -4.30 (-1.07%)
As of 12:31 PM Eastern
This is a fair market value price provided by Massive. Learn more.
52-Week Range$349.20▼
$555.45Dividend Yield0.91%
P/E Ratio23.70
Price Target$556.37
Running a cloud business that relies solely on a single hardware provider weakens bargaining power and drives up the total cost of ownership.
Aggressively adopting rival chips gives Microsoft a direct way to compress its infrastructure costs. By introducing top-tier competition into its buying process, the cloud operator stabilizes its spending and reduces the risk of overreliance on a single supplier.
This dynamic is clearly reflected in how both organizations are currently managing their capital returns.
AMD is executing a targeted $6 billion buyback, authorized in May 2025, a move that often indicates leadership sees the company's shares as undervalued by the market.
Conversely, Microsoft possesses a broader $60 billion authorization that primarily offsets dilution from stock-based compensation during its capital-intensive infrastructure buildout. AMD is capturing immediate value, while Microsoft is aggressively spending to protect its long-term ecosystem.
Institutional Capital Chases the Silicon ShiftInstitutional capital is already front-running this transition in data center economics. Options order flow reveals heavy accumulation of out-of-the-money calls expiring immediately after the upcoming July 23 product events, signaling strong anticipation of upward forward guidance and immediate revenue realization from the Azure deployment.
Analysts are actively re-rating valuation models to account for this multi-year revenue visibility. Recent weeks have seen multiple price target upgrades, pushing expectations for AMD into the $640-$725 range.
This optimism is anchored by real operational acceleration. During the first quarter, AMD reported data center revenue of $5.78 billion, up 57% year over year. Overall quarterly revenue reached $10.25 billion, proving that enterprise adoption is actively translating into top-line growth even before the late 2026 rollouts begin.
This acceleration validates internal banking models projecting a broader infrastructure expansion. Analysts now estimate the AI infrastructure total addressable market could reach $1.5 trillion by 2030. Capturing even a fraction of this expanded market fundamentally alters the growth trajectory for alternative chip makers, moving them from niche alternatives to indispensable pillars of the compute cycle.
The Performance-Per-Watt Paradigm ShiftBeyond sheer computing power, broader industry headwinds heavily favor efficient design. Data center power density constraints are currently limiting how quickly hyperscalers can expand their physical footprints.
Silicon designs prioritizing performance-per-watt offer a solution for power-constrained operators, adding urgency to deployments like Helios. AMD has built its modern engineering philosophy around this exact efficiency metric, giving it a clear advantage as power grids face maximum capacity limits.
However, investors evaluating this space must respect the math. AMD trades at a premium forward price-to-earnings ratio of 81, which demands flawless execution. This valuation multiple means the market is pricing in years of future growth today.
Any supply chain disruptions that delay the late 2026 rollout would likely compress the valuation premium, regardless of long-term infrastructure commitments. Furthermore, steady insider selling at both Microsoft and AMD sends a divergent signal, suggesting that management teams are actively locking in profits rather than continuing to accumulate shares of their respective companies.
Investors might consider adding AMD to their watchlists as enterprise cloud operators continue diversifying their hardware dependencies. Those assessing exposure will want to carefully weigh the execution risks inherent in high-multiple technology stocks against the undeniable structural tailwinds of an expanding AI infrastructure market.
Should You Invest $1,000 in Advanced Micro Devices Right Now?Before you consider Advanced Micro Devices, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Advanced Micro Devices wasn't on the list.
While Advanced Micro Devices currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
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The AI boom extends far beyond the biggest tech names. Discover 10 companies supplying the memory, storage, networking, semiconductor manufacturing, and power infrastructure that make AI possible. Learn where the next wave of AI investment opportunities may emerge—and the key risks investors should watch as the global AI buildout accelerates.
I keep hitting the buy button on AMD (NASDAQ:AMD | AMD Price Prediction) because the projections analysts were sketching a year ago are showing up in the filings, in the customer names, and in the cash flow. Every quarter I tell myself I have enough. Every quarter I add more.
The Thesis I Cannot Shake AMD currently captures just 5% to 7% of global hyperscaler AI accelerator spend, and Wall Street projects that share will expand to 20% to 25% between 2027 and 2028. What convinced me the arithmetic will actually happen is the Helios rack-scale platform, integrating 72 Instinct MI455X GPUs, 6th-Gen EPYC Venice CPUs, and UALink open networking. That turns AMD from a chip vendor into a full-stack system supplier, which is what hyperscalers buy. Multi-gigawatt commitments from Microsoft, Meta, and OpenAI convert a projected share gain into contracted pipeline.
The Receipts Q1 FY2026 gave me three reasons in one filing. Revenue hit $10.253 billion, up 37.85% year over year, with Data Center alone at $5.775 billion, up 57%. Non-GAAP EPS of $1.37 beat the $1.2939 consensus, extending a pattern of revenue beats in all four recent quarters.
Second, the cash is real. Free cash flow reached $2.566 billion, up 252.96% year over year, on top of a full-year FY25 free cash flow of $5.519 billion. Balance sheet: $5.585 billion in cash against a debt/equity ratio of 0.07. That is a fortress underwriting the buildout.
Third, the market Lisa Su is chasing keeps getting larger. On the call, she said “we now expect the server CPU TAM to grow at greater than 35% annually, reaching over $120 billion by 2030,” nearly double the pace outlined months earlier. Q2 guidance calls for roughly $11.2 billion, about 46% year-over-year growth.
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Why Not the Obvious Alternative Readers ask why I do not just own NVIDIA (NASDAQ:NVDA). I own some. I am not adding at these levels because AMD is the share-gain story, and the valuation gap matters. AMD trades at a P/E near 164, but the earnings growth underneath it is net income up 95.06%. As for Intel (NASDAQ:INTC), AMD is taking the business directly. Su noted “our fourth consecutive quarter of record server CPU revenue” with cloud and enterprise each up more than 50%. EPYC cloud instances grew to more than 1,600. Intel is the donor here.
The Risk I Will Not Wave Away The real risk is the valuation itself and China. U.S. export controls on MI308 cost AMD roughly $800 million in Q2 25 charges and $440 million net for FY25. Another round of policy tightening would sting. It has not changed my thesis because the Helios pipeline is North American and European hyperscaler demand, and Su said customer MI450 forecasts are running “above our initial plans that we had planned for 2027”.
Why the Buy Button Stays Live Su told analysts AMD has “a clear path to exceed our long-term financial targets, including delivering more than $20 in EPS over the strategic time frame.” Against a current price of $503.57, that math is the entire argument. Projections stopped being projections the day Meta signed for 6 gigawatts. I am buying the company that delivers them.
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Advanced Micro Devices (NASDAQ:AMD | AMD Price Prediction) shares look like they could be topping out after that parabolic move made in the first half. And while there’s no telling whether this is the peak (the chart certainly looks “toppy”), I do think that there are a number of looming catalysts that could help keep the number-two GPU juggernaut a great longer-term bet, even as the semiconductor scene gives back more of the gains it’d enjoyed earlier in the year.
Most notably, Advanced Micro Devices’ “Advancing AI Summit” might just have a few surprises up its sleeve that spark a bounce-back in the names that investors are growing increasingly worried about hanging onto as some call for a bubble. It’s not just Advanced Micro Devices that could get a shot in the arm as its two-day event kicks off.
The entire sector could move based on what Advanced Micro Devices has in store as it looks to keep making the most of the generational opportunity from the AI revolution.
In a prior piece, I cited Advanced Micro Devices’ fortunate positioning as a number-two GPU titan that was positioned to gain market share with a lower price point at a time when enterprises might be more willing to go for the best price value proposition rather than paying up for the very best.
Why the “Advancing AI” Summit is that much more meaningful in 2026 As rates look to rise and inference hits an inflection point, my bet is that the AI buildout will continue to move forward, but firms will find other ways to save beyond cutting non-AI-related expenses, especially as the costs of memory chips stay overheated.
Whether that means going down the route of software-esque innovations to do more with less hardware, just like China’s leading AI firms, or going for “good enough” chips, rather than the “very best” in the market, I do think that there’s a shift going on that makes Advanced Micro Devices far more interesting than the likes of Nvidia (NASDAQ:NVDA). Perhaps there’s a reason that the former has more than tripled to a 220% gain in the past year while the latter is up just 18% — about as much as the S&P 500.
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When it comes to Advanced Micro Devices, I see the firm as the price disruptor that might be one of the forces that challenge Nvidia’s incredibly high (75% or so) gross margins. Either way, firms have a tough choice to make as hyperscalers innovate with their custom silicon while Advanced Micro Devices looks to go down the route of cost-per-token.
What’s in store for AMD as the event kicks off? A slate of next-generation silicon is going to be the star of the show. But much of what’s coming, at least in my view, is already baked into the stock. Indeed, whether we’re talking about MI450 or the Zen 6 Medusa Point processor (the benchmarks have already reportedly leaked on Geekbench), investors already know what to expect before CEO Lisa Su hits the stage. Any way you look at it, I do think that investors and analysts are going to want to pay closer attention to token economics.
The bigger story, in my view, is going to be all about the company’s guidance, and more about the full-rack Helios system. Indeed, a “sell the news” kind of reaction could hit as well, especially if there’s no additional news on top of the Microsoft (NASDAQ:MSFT) customer announcement made leading up to the big event.
In my humble opinion, any hint of margin compression for Nvidia could mean a “sell first and ask questions later” kind of reaction on the part of investors. And if Helios shipments wind up being further along, perhaps Nvidia shareholders have something else to ponder as agentic AI takes off and Microsoft expands Azure with Helios.
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SummaryRecent multi-year partnerships with Meta and OpenAI, each for 6 GW of AI infrastructure, could generate up to $120 billion in Data Center revenue through 2030.AMD's Helios platform integrates CPUs, GPUs, networking, and software, positioning AMD as a more formidable competitor to Nvidia in rack-scale AI systems.Potential shareholder dilution risk exists if up to 320 million warrants from Meta and OpenAI are exercised, representing a possible 19.6% increase in shares outstanding. Getty Images
By Khaveen Jey, CFA, FMVA, Portfolio Manager @ Khaveen Investments & Anthony Goh, Senior Investment Research Analyst @ Khaveen Investments
In our previous analysis, we compared AMD (AMD) with Intel (INTC) and explained
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Khaveen Investments is registered as an investment adviser with the U.S. Securities and Exchange Commission (SEC). Registration with the U.S. SEC does not imply a certain level of skill or training. No information in this publication is intended as investment, tax, accounting, or legal advice, or as an offer/solicitation to sell or buy. Material provided in this publication is for educational purposes only and was prepared from sources and data believed to be reliable, but we do not guarantee its accuracy or completeness.
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.
NEW YORK, July 21, 2026 (GLOBE NEWSWIRE) -- WHY: Rosen Law Firm, a global investor rights law firm, announces an investigation of potential securities claims on behalf of shareholders of Alibaba Group Holding Limited (NYSE: BABA) resulting from allegations that Alibaba may have issued materially misleading business information to the investing public. SO WHAT: If you purchased Alibaba securities you may be entitled to compensation without payment of any out of pocket fees or costs through a contingency fee arrangement.
Wall Street expects a year-over-year increase in earnings on higher revenues when Boeing (BA - Free Report) reports results for the quarter ended June 2026. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.
The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on July 28. On the other hand, if they miss, the stock may move lower.
While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise.
Zacks Consensus EstimateThis airplane builder is expected to post quarterly loss of $0.24 per share in its upcoming report, which represents a year-over-year change of +80.7%.
Revenues are expected to be $24.03 billion, up 5.7% from the year-ago quarter.
Estimate Revisions TrendThe consensus EPS estimate for the quarter has been revised 573.35% lower over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.
Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts.
Price, Consensus and EPS Surprise
Earnings WhisperEstimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction).
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.
Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.
A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.
Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).
How Have the Numbers Shaped Up for Boeing?For Boeing, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -67.24%.
On the other hand, the stock currently carries a Zacks Rank of #3.
So, this combination makes it difficult to conclusively predict that Boeing will beat the consensus EPS estimate.
Does Earnings Surprise History Hold Any Clue?Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number.
For the last reported quarter, it was expected that Boeing would post a loss of$0.95 per share when it actually produced a loss of -$0.20, delivering a surprise of +78.95%.
Over the last four quarters, the company has beaten consensus EPS estimates two times.
Bottom LineAn earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss.
That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
Boeing doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release.
An Industry Player's Expected ResultsAnother stock from the Zacks Aerospace - Defense industry, RTX (RTX - Free Report) , is soon expected to post earnings of $1.66 per share for the quarter ended June 2026. This estimate indicates a year-over-year change of +6.4%. Revenues for the quarter are expected to be $22.83 billion, up 5.8% from the year-ago quarter.
The consensus EPS estimate for RTX has been revised 0.1% lower over the last 30 days to the current level. However, a higher Most Accurate Estimate has resulted in an Earnings ESP of +2.02%.
When combined with a Zacks Rank of #2 (Buy), this Earnings ESP indicates that RTX will most likely beat the consensus EPS estimate. The company beat consensus EPS estimates in each of the trailing four quarters.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
SummaryBoeing (BA) demonstrated stable net order inflow in June, booking 113 net orders valued at $7.3 billion, with strong single-aisle demand. BA's delivery cadence is improving, with 64 aircraft delivered in June and year-to-date deliveries up 12%, reflecting more sustainable, output-based production. Key operational milestones include ramping up 737 MAX and 787 production, inaugurating a fourth 737 MAX line, and progressing on MAX 7, MAX 10, and 777X certifications. Book-to-bill ratios above 1x signal robust demand, but focus remains on converting backlog to deliveries and achieving pre-crisis output levels. Looking for more investing ideas like this one? Get them exclusively at The Aerospace Forum. Learn More » Jon Tetzlaff/iStock Editorial via Getty Images
Boeing (BA) has kicked off the Farnborough Airshow with 140 orders and commitments while keeping the 20-year demand forecast steady despite lower traffic growth expected this year. The US jet maker is
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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.
Amazon (NASDAQ:AMZN | AMZN Price Prediction) and NVIDIA (NASDAQ:NVDA) just closed earnings on opposite sides of the AI infrastructure trade. Amazon reported Q1 FY2026 on April 29, 2026, with AWS growing 28% and custom silicon crossing a $20 billion annual run rate. NVIDIA followed with Q1 FY2027 revenue of $81.62 billion, up 85.2%. Trainium is the reason to compare them right now.
AWS Sprints, Blackwell Still Roars AWS hit $37.59 billion in revenue, the fastest growth in fifteen quarters. CEO Andy Jassy told investors Amazon now has “over $225 billion in revenue commitments for Trainium”, anchored by Anthropic’s 5 GW deal and OpenAI’s 2 GW commitment starting 2027. Trainium2 is “largely sold out”, with 1.4 million chips already deployed powering most Bedrock inference.
NVIDIA’s Data Center revenue reached $75.25 billion, up 92%, with networking alone up 199%. Jensen Huang called this “the largest infrastructure expansion in human history”. Blackwell 300 is ramping and Vera Rubin is queued behind it. Non-GAAP gross margin held at 75.0%, roughly the mirror image of Amazon’s 50.3%.
The Three Ways Trainium Cracks NVIDIA’s Moat First, the mass volume ramp is happening now. The 3nm Trainium 3 moved from select early customers in early 2026 into mass production, and AWS hiked its Q3 2026 server shipment targets by 20% to 30% to support the ramp. Jassy said Trainium 3 is “30% to 40% more price performant than Trainium2” and nearly fully subscribed.
Second, distribution is changing. Reports emerged in June 2026 that Amazon is in active talks to sell physical Trainium server racks directly to external, sovereign, and co-location data centers. That breaks the AWS-only wall Trainium has lived behind and puts it in NVIDIA’s direct sales lane.
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Third, Trainium 4 lands next. The chip is designed to offer 3x the processing power of Trainium 3, is already heavily pre-ordered, and is scheduled for initial deployment in late 2026 to early 2027. Amazon frames the savings bluntly: “tens of billions of dollars of CapEx each year”.
Lens Amazon NVIDIA Core Bet Vertical AI stack GPU platform lock-in Gross Margin 50.3% 75.0% Anchor Commit $225B Trainium OpenAI 10 GW The Rubin Ramp Will Decide 2027 Watch whether Vera Rubin arrives with pricing power intact, or whether hyperscalers use Trainium 4 leverage to negotiate harder. Amazon still plans to deploy 1 million or more NVIDIA GPUs starting in 2026, so this is a share shift, not a replacement. The mix worth watching is inference workloads migrating from GPU to Trainium inside Bedrock’s 125,000 customer base.
Why I Lean Amazon for the Next Eighteen Months Amazon trades at a P/E of 30, the lowest in over a decade, while the chip business compounds at triple digits with anchor customers locked in. NVIDIA is the safer operating model at a 75.0% gross margin, but Polymarket traders see just a 5.8% chance NVDA closes above $220 today. For defensive AI exposure at a premium multiple, NVIDIA still works. For a re-rating catalyst tied to a specific product, Trainium 4 into early 2027 is the cleaner setup.
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There are high-yielding ETFs, and then there is the YieldMax Semiconductor Portfolio Options Income ETF (CHPY +5.27%). The fund currently offers a jaw-dropping 40% yield based on its latest weekly distribution payment and current share price, which has tumbled nearly 20% from its recent peak.
Here's a look at whether you'd be missing out by not scooping up this ultra-high-yielding ETF while it's cheaper.
Image source: Getty Images.
An introduction to CHPY The YieldMax Semiconductor Portfolio Options Income ETF is an actively managed fund with two mandates:
Generate current income: CHPY seeks to collect option premium income by selling call spreads on companies it holds. It aims to distribute this income weekly. Provide capital appreciation potential: The fund holds a focused portfolio of 15 to 30 semiconductor stocks to capture upside. The fund has achieved remarkable results with both objectives since its launch in April 2025. CHPY has made a distribution payment every week since its inception. It has grown its weekly payout from $0.362 to $0.5925 per share. However, its payout has been volatile, ranging from $0.3454 to $0.7743 per share.
Meanwhile, unlike many ultra-high-yielding ETFs, this fund has managed to grow its net asset value (NAV) per share. Despite the recent 20% drop, CHPY's share price is up over 57% since its inception. Add in the lucrative weekly options income stream, and this ETF's total return is a robust 165%.
NYSEMKT: CHPYTidal Trust II - YieldMax Semiconductor Portfolio Option Income ETF
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How CHPY delivers such robust returns The secret to CHPY's success lies in its portfolio. The ETF holds a concentrated portfolio of the largest semiconductor stocks. These companies are among the leaders in AI. For example, its top holding is Nvidia (NVDA +0.92%), which accounts for 5.9% of its net assets. Nvidia is growing briskly (85% revenue growth in its fiscal 2027 first quarter) due to robust demand for its AI chips by hyperscale data center operators. This robust growth is driving its share price up, which has surged nearly 19% over the past year. Meanwhile, other top holdings include Intel and Micron Technology, which have seen even bigger rallies of 325% and 680%, respectively. These monster gains are helping CHPY deliver meaningful NAV-per-share appreciation.
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Semiconductor stocks are also highly volatile (nearly five times more than the S&P 500). As a result, their options have high premiums. CHPY is harvesting these high options premiums by selling call spreads (selling a call option above the underlying's current price and buying another one at an even higher price).
For example, it currently holds nearly 310,000 shares of Nvidia. It wrote 3,099 calls that expire later this week at $207.50 per share, and bought the same number of calls at $212.50 per share. With the stock currently below the written call price, this trade is on track to expire at full profit. It makes similar, repeatable trades across all its holdings, generating regular income.
Buy the 20% dip? We've seen the volatility of semiconductor stocks firsthand in recent weeks. Nvidia is currently nearly 14% below its recent high, while Micron and Intel have tumbled 27% and 30%, respectively. This decline has driven the 20% dip in CHPY's share price.
Even with a lower price, CHPY isn't for everyone. The ETF is best for investors with a very high risk tolerance who seek to capitalize on the currently high volatility in semiconductor stocks. It won't last forever, meaning CHPY's monster yield will likely trend down in the future. However, this fund has the potential to turn a small investment into a big-time income stream while offering meaningful upside. Given the risks, investors who do buy CHPY should keep their allocation small and consider reinvesting the currently lucrative weekly income stream into a lower-risk position.
Matt DiLallo has positions in Intel and Tidal Trust II-YieldMax Semiconductor Portfolio Option Income ETF and has the following options: short August 2026 $150 calls on Intel. The Motley Fool has positions in and recommends Intel, Micron Technology, and Nvidia. The Motley Fool has a disclosure policy.
Nvidia shares have risen 22% over the past 12 months coming into Tuesday's session. (Marlena Sloss/Bloomberg)
Nvidia stock was rising early Tuesday amid a broader semiconductor-stock rally. The artificial-intelligence chip company could regain its luster this earnings season, according to analysts at Susquehanna.
IXUS offers broad, low-cost diversification across thousands of non-U.S. stocks with a higher dividend yield, while NZAC's climate-focused approach has delivered slightly better five-year returns.
Shares of Nebius Group NV (NASDAQ:NBIS) gained more than 13% in New York trading this morning after Nvidia Corp (NASDAQ:NVDA, XETRA:NVD) disclosed a passive stake of 9.3% in the company, equivalent to 22.26 million shares.
The stake is not new capital deployment. It reflects Nvidia's existing position of 1.19 million shares combined with a $2 billion prefunded warrant covering roughly 21 million shares.
Nvidia and Nebius already work together on AI infrastructure deployment, fleet management, inference and the design and support of AI factories.
The disclosure formally establishes Nvidia as a major shareholder in a company that has become one of Europe's leading neoclouds.
Nebius has built its reputation providing AI compute infrastructure, striking multiple deals with major technology companies through 2026 as spending on AI infrastructure has surged across the industry.
The disclosure acts as a strategic endorsement from Nvidia, signaling that Nebius holds preferred status as an infrastructure partner within the GPU maker's broader ecosystem.
Namibia Critical Metals (TSX-V:NMI, OTCQB:NMREF) announced that the Joint Management Committee overseeing the Lofdal Heavy Rare Earth Project in Namibia has approved the next phase of work for the project's definitive feasibility study (DFS), including up to approximately C$11 million in additional funding to advance completion of the study.
The company also announced the award of its first major metallurgical and geometallurgical contracts under the expanded DFS program to SGS Canada, which will carry out testing and process development work.
According to the company, the approved programs mark the transition of the Lofdal project into full DFS execution. The work is intended to validate the complete processing flowsheet from run-of-mine ore through to the production of separate light and heavy rare earth carbonate products, while generating engineering and operating data to support updated plant design and project financing.
A key objective of the expanded metallurgical program is to evaluate the production of higher-value intermediate rare earth products in Namibia. Rather than exporting mineral concentrates for further processing, the program will assess integrated hydrometallurgical processing to produce separate light rare earth carbonate (LREC) and heavy rare earth carbonate (HREC) products.
The company stated that this approach aligns with Namibia's goal of increasing domestic beneficiation of critical minerals while supporting industrial development and long-term economic value creation.
Namibia CEO Darrin Campbell said the approval of additional DFS funding will support a comprehensive metallurgical development program designed to reduce processing risks and provide engineering data required for detailed design and project financing.
"Equally important, these programs move Lofdal beyond conventional mineral concentrate production toward higher-value mixed and separated rare earth products,” Campbell said. “This work supports Namibia's vision of developing downstream critical mineral industries while strengthening secure and diversified supply chains for Japan and other allied economies.”
Under the approved work program, approximately 30 tonnes of representative ore will undergo continuous pilot-scale flotation testing to validate the processing flowsheet, optimize operating conditions and produce concentrate for downstream hydrometallurgical processing.
A continuous hydrometallurgical pilot plant will also be established to demonstrate the complete processing flowsheet, including acid bake, leaching, impurity removal, solvent extraction and precipitation. The campaign is expected to produce mixed rare earth carbonate followed by separate light and heavy rare earth carbonate products.
Additional laboratory and pilot-scale solvent extraction work will focus on optimizing the separation of light and heavy rare earth elements and identifying opportunities to improve operating economics through lower reagent consumption.
The expanded program also includes a geometallurgical campaign involving 98 representative samples from across the Lofdal deposit to refine geometallurgical domains and develop predictive processing models for mine planning and process optimization.
The company said the work is expected to validate pilot-scale processing performance, generate engineering design criteria for the process plant, optimize recoveries and operating costs, support environmental permitting activities and further de-risk the processing component of the Lofdal project ahead of completion of the definitive feasibility study.
Shares of Namibia Critical Metals (TSX-V:NMI, OTCQB:NMREF) jumped over 14% at the open in Toronto before settling to trade around C$0.18 by midmorning.
Graphene Manufacturing Group Ltd (TSX-V:GMG, OTCQX:GMGMF) has signed a global exclusive memorandum of understanding (MOU) with French rail manufacturer Alstom to test and develop graphene products for the rail industry, with an initial focus on heating, ventilation and air conditioning (HVAC) systems.
Under the agreement, GMG and Alstom will collaborate on evaluating, developing and commercializing graphene-based products for rail HVAC applications. The MOU is global and exclusive, according to the company.
Alstom is focused exclusively on the rail industry, producing products and services including high-speed and regional trains, metros, trams, signalling systems and rail infrastructure.
GMG CEO Craig Nicol said that the agreement provides an opportunity to introduce the company's graphene technology into the rail sector.
"Rail systems demand the highest standards of performance, durability and efficiency — and we believe graphene is uniquely positioned to deliver meaningful improvements across a range of applications,” Nicol said. “We look forward to working closely with the Alstom team to develop and commercialise graphene products that will help shape the future of rail."
GMG non-executive chairman and director Jack Perkowski described the agreement as a significant milestone for the company and said it could create an additional source of revenue.
"The fact that a company of Alstom's scale and technical sophistication has chosen to partner exclusively with GMG to evaluate develop and commercialize graphene-based products for the rail industry is a powerful validation of our technology and our team's capabilities,” Perkowski said. “This arrangement has the potential to open a new revenue stream for GMG and reinforces our strategy of targeting large, established industries where graphene's unique properties can deliver measurable, real-world impact."
Shares of GMG added 2.3% on Tuesday morning at C$2.19 in Toronto.
11:00am: AI rally faces reality Some analysts are wondering whether market expectations have already been pushed too high.
Linh Tran, Market Analyst at XS.com, believes what we’re seeing is “more than ordinary profit-taking.”
“With valuations already reflecting much of the optimism surrounding artificial intelligence, the market is no longer satisfied with earnings simply beating forecasts,” Tran wrote.
“Investors now expect companies to keep raising their revenue outlooks, preserve profit margins and prove that the enormous amount of capital being committed to AI infrastructure can generate adequate economic returns.”
Still, Tran believes the market’s long-term uptrend remains intact, but investors may face a more selective environment ahead. A measured pullback could be constructive by easing valuation concerns and setting the stage for a healthier continuation of the rally, the analyst added.
9:55am: Investors look past trade worries Stocks opened higher Tuesday morning, with the Nasdaq leading the charge as chip stocks bounced back and investors digested a fresh batch of corporate earnings.
The Nasdaq climbed 0.7% to 25,687, while the S&P 500 gained 0.4% to 7,468 and the Dow Jones Industrial Average edged up 0.2% to 51,924.
Technology shares regained momentum after recent pressure on semiconductor names, helping to steady markets as investors look ahead to a busy stretch of earnings from major companies.
Corporate results offered another boost to sentiment. General Motors Company (NYSE:GM) reported stronger-than-expected second-quarter results, posting revenue of $48.03 billion versus the $46.61 billion expected by analysts. The automaker also delivered adjusted earnings per share of $3.57, ahead of the $3.19 consensus estimate, while adjusted EBIT came in at $3.94 billion compared with expectations of $3.7 billion.
Industrial giant 3M Co (NYSE:MMM) also topped forecasts, reporting second-quarter revenue of $6.5 billion and adjusted earnings per share of $2.40, ahead of estimates of $6.4 billion and $2.24, respectively. The company said adjusted operating margins improved to 24.9% and raised its full-year 2026 adjusted outlook.
Investors were also keeping an eye on the labour market after data from ADP showed private-sector hiring slowed for a fourth consecutive week. Employers added an average of 16,500 jobs per week in the four weeks through July 4, down from 24,250 three weeks earlier, suggesting some cooling in employment conditions.
Trade tensions remained in focus as US Treasury Secretary Scott Bessent defended the possibility of a 50% tariff on Canada, describing the move as “just reciprocity.”
“Any sustained dip-buying could help turn the tide and push the broader market to the upside,” said Paolo Broccardo, CEO at BankPro. “Strong earnings and resilient guidance could reinforce confidence in the sector, while any disappointment may revive selling pressure.”
8:30am: Fresh US-Canada trade tensions Wall Street looks set for a stronger start on Tuesday, with technology stocks once again leading the way as investors prepare for another busy day of corporate earnings and keep a close eye on trade developments.
Ahead of the opening bell, Nasdaq futures were up 1.3%, while S&P 500 futures gained 0.4%. Dow Jones futures were more modestly higher, rising 0.2%.
Chip stocks were back in favor after another wave of buying in the sector. Nvidia ticked higher in pre-market trading after the AI chip giant disclosed it had taken a stake in neocloud provider Nebius, adding fresh momentum to a group that has been driving much of the market's gains this year.
Investors will also be digesting a new escalation in trade tensions. President Donald Trump announced a fresh round of 50% tariffs on a range of Canadian goods, including beer, hockey sticks, milk and chemicals, with the measures set to take effect in 30 days. The White House said the move was in response to what it described as discriminatory Canadian trade practices, raising the prospect of another round of retaliatory measures between the two countries.
One notable exception was Canadian crude oil, which was spared from the new tariffs. Oil prices eased slightly Tuesday morning after surging in recent sessions as renewed fighting involving Iran pushed Brent crude back toward the $90-a-barrel mark, its highest level since mid-June.
The earnings calendar also picks up pace before the market opens, with General Motors, Halliburton and 3M all scheduled to report quarterly results, helping set the tone ahead of this week's closely watched reports from several Big Tech heavyweights.
3M Co (NYSE:MMM) shares rose about 9% in early trade on Tuesday after the industrial conglomerate reported second-quarter adjusted earnings and revenue above Wall Street expectations and increased its full-year 2026 earnings guidance.
The company reported adjusted earnings per share of $2.40 for the quarter, ahead of the consensus estimate of $2.24 and up 11% from a year earlier.
Revenue totaled $6.5 billion, exceeding expectations of about $6.4 billion, with adjusted organic sales growth of 5.4% year over year.
On a GAAP basis, net sales increased 2.4% from the prior year, while operating margin declined to 15.1% from 18%. GAAP earnings per share rose to $1.78 from $1.34 a year earlier.
Adjusted operating income margin improved 40 basis points year over year to 24.9%.
"We delivered a strong second quarter, exceeding expectations with mid-single-digit sales growth, robust operating margins of about 25%, and double-digit EPS growth, reflecting the progress we're making on our strategic priorities and building a higher-performing company," 3M CEO William Brown said in a statement.
"As a result of our strong first-half performance and continued momentum, we are increasing our full-year guidance and remain confident in our ability to create long-term value for shareholders," Brown added.
Looking ahead, 3M raised its full-year 2026 adjusted earnings per share guidance to a range of $8.80 to $8.95, up from its previous forecast of $8.50 to $8.70.
The company continues to expect adjusted total sales growth of more than 4.5%, reflecting adjusted organic sales growth of more than 3.5%, and projects adjusted operating income margin expansion of 70 to 80 basis points.
It also reaffirmed expectations for adjusted operating cash flow of $5.8 billion to $6 billion and adjusted free cash flow conversion of more than 100%.
