Tech Earnings Were Strong, but AI Progress Has Been Slow

Technology stocks slumped into correction territory this past week, after a wave of poorly received earnings reports from some of the world’s largest companies. On Wednesday and Thursday, the Nasdaq Composite fell 4.1%, the tech-heavy index’s worst two-day stretch of the year. The index has fallen 12% since July.

But here’s the issue: The Street has been thinking that Google would leverage its prowess in AI software to boost its share of the cloud market. Google has unveiled a flurry of AI tools and services in recent months, including the Bard chatbot, which you can now use to search not just the web but also your own documents and emails. In fact, Google had been viewed as having deeper expertise in AI than rival Amazon Web Services.

After its stock outperformed on the week, Microsoft is now threatening Apple’s title as the world’s most valuable company—the gap is down to about $115 billion. Microsoft shares have outperformed Apple shares by nearly 10 percentage points this year. “Companies have moved more slowly in an uncertain economy in 2023 to complete deals,” Jassy said on the Amazon earnings call, “but we’re seeing the pace and volume of closed deals pick up and we’re encouraged by the strong last couple of months of new deals signed.”

The biggest third-quarter ad win came from an advertising upstart: Amazon’s ad sales were up 26%, to $12.1 billion. That’s more than 10 times the size of Snap’s total business, and more than 50% bigger than YouTube’s ad business. Meta sees 2024 capital spending of $30 billion to $35 billion, up roughly 15% from this year’s level. That’s a lot of dough, but the growth is actually slower than investors had anticipated, which is trouble for Arista Networks . The provider of networking gear counts on Meta and Microsoft for 50% of sales. Arista share fell 8% Thursday, trimming its valuation by nearly $5 billion.

Australia Australia Latest News, Australia Australia Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Stock Market Today: Stocks tick higher after strong finish to Big Tech earningsAmazon injected markets with a bit of optimism after posting strong results Thursday.
Source: startelegram - 🏆 248. / 63 Read more »

Intel Stock Earnings: INTC rises nearly 10% on earnings surprise, robust Q4 outlookIntel (INTC) stock soared 9.7% mid-session on Friday after the legacy semiconductor company posted earnings nearly double Wall Street’s expectation.
Source: FXStreetNews - 🏆 14. / 72 Read more »

Meta Stock Jumps on Strong EarningsThe Facebook parent reported revenue of $34.2 billion, up 23% from a year ago.
Source: MarketWatch - 🏆 3. / 97 Read more »

Valero tops profit estimates in strong start to U.S. refiner earningsRefiner Valero Energy (VLO.N) beat analysts' estimates for third-quarter profit on Thursday, powered by sustained fuel and refined products demand against the backdrop of tight supplies.
Source: Reuters - 🏆 2. / 97 Read more »

Intel Reports Strong Earnings. The Stock is Rising.Intel reported revenue of $14.2 billion, ahead of Wall Street's $13.6 billion estimate.
Source: MarketWatch - 🏆 3. / 97 Read more »

Chipotle shares climb on Q3 earnings beat, strong comparable salesChipotle reported third-quarter results after market close Thursday
Source: MarketWatch - 🏆 3. / 97 Read more »