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AI Frenzy Fuels Tech Giants' Earnings as Meta Leads the Charge
28 Jul
Summary
- Nvidia becomes first $4 trillion company, driven by AI mania
- Apple seen as lagging in AI, while Meta touts AI benefits in Q1 2025
- All eyes on Meta's Q2 2023 earnings and AI commentary
The AI trade is back in full force, with tech giants like Apple, Amazon, Microsoft, and Meta Platforms set to report their Q2 2023 earnings this week. While the AI hype seemed to have faded a few months ago, it has now returned with a vengeance.
The AI mania has helped propel Nvidia into a $4 trillion company, making it the first ever to reach that milestone. On the other hand, Apple is seen as having slacked off on AI, with the iPhone maker down more than 14% this year.
However, Meta, the parent company of Facebook, has shattered the "AI is a bubble" narrative. During its Q1 2025 earnings call, the company explained how it is benefiting from AI and announced an increase in capital expenditure related to its investments in data centers.
As Meta prepares to release its Q2 2023 earnings on July 30th, all eyes will be on the company's AI commentary. Analysts expect Meta to report strong revenue growth of 14.6% year-over-year, driven by the strength in the digital ad market and a weaker dollar. The company's earnings per share are also expected to rise nearly 13% year-over-year, despite the increased outlay toward AI-related capital expenditures.
During the earnings call, investors will be keen to hear more about Meta's recent AI talent headhunting and its investment in Scale AI, in which it took a 49% stake last month.
