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Who Won The Cloud War

steemychicken1 — Thu, 29 Oct 2026 20:37:42 GMT

Yesterday, we had the Federal Reserve meeting. And as expected, there were no surprises. Interest rates remained unchanged at 3.75%–4.00%. In fact, two members voted in favor of a rate hike.

The only change we might see in the future? Fewer meetings. Warsh announced that, starting in the fall of 2027, one of the eight annual meetings will become a strategy session, with no interest rate decision. And in 2028, the number of meetings involving rate decisions will drop to six.

But honestly, that wasn't the biggest news of the evening. It was the earnings reports from Alphabet and Microsoft. Two giants following exactly the same playbook. Yet investors reacted to them in completely different ways.

ALPHABET AND THE CLOUD BUSINESS THAT DOUBLED

Let's start with my favorite, Alphabet. Revenue reached $127.6 billion, up 25%. That's a very strong number, right? Yes. But analysts had expected slightly more, around $128 billion. A narrow miss, in other words.

The star of the evening was Google Cloud. Revenue came in at $30.7 billion, up from $15.16 billion last year. Yes, that's a 103% increase. In just one year, Alphabet's cloud business doubled. Operating income more than tripled as well.

Of course, there's a big "but." Search, the company's core business, generated $63.35 billion, compared with estimates of around $65 billion. YouTube advertising revenue came in at $11.2 billion, versus the market's expectation of $11.4 billion. Both missed expectations.

And here's something puzzling. Sundar Pichai says search queries are growing at their fastest pace in five years. In other words, people are searching more than ever. Yet revenue didn't grow as much as analysts had expected.

WHAT DRAGGED DOWN EARNINGS?

"And what about earnings per share?" you might be wondering. They came in at $2.12, while the market had expected around $3.00. Last year, the figure was $2.87.

So what happened? Put simply, Alphabet recorded an $8.7 billion loss from the valuation of its investments in other companies. This has nothing to do with how well the core business is performing. It's an accounting issue that could reverse in a subsequent quarter.

Nevertheless, the company broke a streak of 12 consecutive quarters in which earnings exceeded expectations.

And as if that weren't enough, there's also spending. Alphabet poured $51.4 billion into infrastructure in a single quarter. So much that its free cash flow turned negative.

What should we expect going forward? Pichai is talking about an annual revenue run rate of half a trillion dollars. Meanwhile, the Gemini app has reached 1 billion users. The direction is clear. The question investors are asking is how much it will cost.

And the market's response was harsh. The stock fell close to 10% in after-hours trading. As CNBC reported, the revenue miss and heavy spending on cloud infrastructure shook the entire AI investment thesis.

MICROSOFT BEATS ALL EXPECTATIONS

Now let's turn to Microsoft. The picture here is completely different.

Revenue came in at $92.3 billion, up 19%, compared with expectations of around $90.7 billion. Earnings per share reached $4.89, versus estimates of $4.72–$4.73. Net income climbed 32% to $36.6 billion, helped in part by a $207 million contribution from its investment in OpenAI.

And then there's Azure, Microsoft's cloud business. It grew 48%, reaching $33.2 billion. The market had expected growth of around 45%. Overall, Microsoft's cloud business generated $63.9 billion.

Infrastructure spending? $39.4 billion, double last year's figure. But that was approximately $6 billion less than analysts had expected.

What should we expect from here? Microsoft has commercial commitments worth $677 billion, up 73%. What does that mean? These are contracts that have already been signed but have not yet been recognized as revenue. In other words, the company already knows it has an enormous amount of business ahead of it.

Chief Financial Officer Amy Hood described it as a "strong start to the year."

And investors? They were pleased. The stock rose close to 4% in after-hours trading.

WHAT THE TWO GIANTS HAVE IN COMMON

If we put the two companies side by side, there are plenty of similarities.

At both companies, cloud computing is doing the heavy lifting. And behind cloud growth is enormous demand for AI.

Both spent massive amounts on infrastructure, but less than the market had expected: $51.4 billion versus approximately $56 billion for Alphabet, and $39.4 billion versus around $46 billion for Microsoft.

Even their investments in other companies affected net income. In one case, they dragged earnings down. In the other, they provided a boost.

"So why such a different market reaction?" you might ask.

Read the full post

$AEM Keeps Delivering While Gold Consolidates

borsengelaber — Thu, 29 Oct 2026 09:43:45 GMT

Strong Cash Flow, Strong Balance Sheet

Agnico Eagle delivered solid numbers, generating $1.35B in net income ($2.67/share) and $852M in free cash flow at gold prices of $4,264/oz.

Despite gold consolidating since earlier this year, lower production (814k oz) and higher costs, cash generation remains strong. AISC came in at $1,648/oz, with full-year guidance intact.

The balance sheet is rock-solid, with $3.4B+ in net cash. A $0.45/share dividend and $250M in buybacks returned $478M to shareholders — 56% of quarterly FCF.

My takeaway: $AEM keeps generating serious cash, strengthening its balance sheet, and rewarding shareholders, even without another leg up in gold. Should we see Gold above $5,000 again next year this stock is going to rock imo. I am stacking more every week.

Visa: Strong Earnings And Record Revenue

steemychicken1 — Wed, 28 Oct 2026 19:33:51 GMT

Last night, after Wall Street closed, Visa reported its quarterly results. The numbers were very strong. Earnings came in above analysts' expectations, annual revenue reached a record, and the company increased its dividend by 16%.

And yet, the stock fell.

How can a company perform so well and still see its share price decline? The answer lies in what Visa expects for the year ahead.

QUARTERLY RESULTS AT A GLANCE

Let's start with the basics. Visa reported earnings per share of $3.48, an increase of 17% compared with last year. Analysts had expected $3.44, so the company beat expectations. And this wasn't the first time. Visa had also beaten earnings estimates in each of the previous eight quarters.

Revenue reached $12.1 billion, up 13%. However, there was no surprise here, as revenue came in exactly in line with analysts' expectations. Net income increased to $6 billion, compared with $5.1 billion a year earlier.

Looking at the full fiscal year, which ended on September 30, Visa generated $45.9 billion in revenue, a record and a 15% increase. That's why CEO Ryan McInerney described it as a milestone year.

The quarterly dividend is also increasing to $0.78 per share, up from $0.67. Visa has raised its dividend every year since 2008, when it went public. During the year, the company also repurchased $20.5 billion worth of its own shares.

So, how exactly does Visa make money?

In simple terms, Visa isn't a bank. It doesn't lend money. It's the payment network that processes transactions whenever you use your card. Visa earns revenue from these transactions.

The more people spend using their cards, the better it is for Visa.

WHAT DROVE THE EARNINGS?

This is where the American consumer comes into the picture. Consumers continue to spend, supported by a strong labor market and wage increases, according to Reuters. People used their cards for travel, shopping, and dining out.

Overall, Visa processed 74.2 billion transactions during the quarter, an increase of 10%. Payment volume rose by 9%.

But the most interesting figure was cross-border spending, meaning payments made when using a card abroad. Excluding transactions within Europe, cross-border payments increased by 14%, compared with 12% in the previous quarter.

Why was growth so strong? One contributing factor was the FIFA World Cup. The tournament brought visitors to the United States, boosting activity across Visa's payment network, according to Reuters.

The impact was also reflected in revenue. Revenue from data processing increased by 16%, reaching $6.2 billion.

WHAT DOES VISA EXPECT FOR 2027?

This is where things get interesting. On Wall Street, yesterday's results matter, but what investors really focus on is tomorrow.

For fiscal 2027, Visa expects revenue to grow at a low double-digit rate, meaning slightly above 10%. Earnings per share are expected to grow at a rate ranging from the low double digits to the low teens.

This year's performance was stronger, with revenue increasing by 15% and earnings per share rising by 16%.

What does that mean?

Visa is expected to keep growing, but at a slower pace.

At the same time, the company is preparing for its next phase of growth. Visa has agreed to acquire BioCatch, a company specializing in fraud detection, for $2.4 billion in cash.

CEO Ryan McInerney made the company's priorities clear, stating that trust is the next growth driver for Visa.

WHY DID THE STOCK FALL?

Immediately after the results were announced, Visa shares fell by more than 1% in after-hours trading.

You might ask why, given how strong the results were.

No single explanation was officially identified. However, the numbers offer some clues.

First, revenue merely met expectations. There was no positive surprise.

Second, payment volume grew by 9%, compared with 10% in the previous quarter. That's a small difference, but investors scrutinize even minor changes in growth rates.

Third, the company itself expects slower growth in 2027 than it achieved this year.

And there's another important factor to consider. Before the earnings announcement, Visa's stock had already gained 14.6% since the beginning of the year. Expectations were therefore already high.

When expectations are high, even very good results may not be good enough.

Mastercard is also due to report its results later this week. That should provide another useful comparison and help investors determine whether Visa's performance reflects a broader trend across the payments industry.

Anthropic Filed To Go Public

steemychicken1 — Tue, 27 Oct 2026 20:48:42 GMT

Everyone Is Scrambling for AI Money

Today, we have something very interesting. Everyone is looking for money to fund AI. And when I say everyone, I mean EVERYONE.

Anthropic has filed its paperwork to go public. Meta is issuing new shares to raise $95 billion. And SpaceX is borrowing $40 billion to buy chips. To put things into perspective, Goldman Sachs estimates that AI investments between 2026 and 2031 could reach $7.6 trillion.

Yes, you read that correctly. Trillions.

At the same time, however, Elon Musk is warning that more than 200 companies in the sector will disappear.

ANTHROPIC IS GOING PUBLIC

Anthropic, the company behind Claude, has officially filed its S-1 registration statement with the U.S. Securities and Exchange Commission (SEC).

"What's that?" you might be wondering. Put simply, it's the document a company files to open its books to investors before going public.

It will list on the Nasdaq under the ticker symbol "ANT." The share price and number of shares have not yet been determined.

And this is where things get even more interesting.

In the first half of 2026, revenue reached $16.29 billion, compared with $1.16 billion a year earlier. That's more than fourteen times higher. Gross profit margin also climbed to 85%, up from 12% last year.

"So, it's making insane profits, right?" you might be asking.

Not exactly. The company reported a net loss of $80.7 billion for the six-month period. Yes, a LOSS OF $80 BILLION.

However, $72.4 billion of that figure was an accounting charge, mainly resulting from the increase in its valuation. The operating loss was "only" $693 million.

And where is all that money going? Computing power.

Anthropic has committed to spending $110 billion on Amazon's Trainium chips through 2036 and $114.5 billion on Google's chips through 2033. The company has also warned that its operating margins will fluctuate whenever new computing capacity comes online.

One final point: in May, Anthropic was valued at $965 billion, and its investors are hoping for a valuation exceeding $2 trillion. However, anyone buying shares won't have much say in how the company is run.

A special class of shares held by the seven founders will retain 50.1% of the voting power.

META IS ISSUING NEW SHARES

Now let's move on to the second development.

Meta announced that it plans to raise a total of $95 billion to fund AI infrastructure. How? First, $35 billion through a public share offering. Then another $60 billion by gradually selling shares on the market.

Nvidia, AMD, and Broadcom are reportedly interested in purchasing up to $5 billion worth of shares.

"Why would a company like Meta need money?" Good question.

Last week, Meta released its results. Revenue increased by 26% to $64.6 billion, exceeding analysts' expectations of $63.37 billion.

But investors were looking elsewhere: at negative free cash flow and infrastructure spending, which is now projected to reach $135 billion to $145 billion for the full year.

Meta is building four enormous computing centers, each with a capacity of more than one gigawatt.

And Meta isn't alone. In June, Alphabet announced plans to raise $85 billion.

As Ben Wood of CCS Insight put it, all of this highlights the "extraordinary levels of investment" required to stay competitive in the AI race.

SPACEX IS BORROWING MONEY, AND MUSK IS SOUNDING THE ALARM

This brings us to SpaceX, which isn't issuing shares. It's borrowing money instead.

The company secured $40 billion in financing through Apollo to purchase GPUs, the chips that power AI models. The chips are expected to be delivered in the first and second quarters of 2027.

AI has now become the company's largest business, generating $7.56 billion in revenue in the third quarter, compared with $813 million a year earlier. That's almost nine times as much.

At the same time, however, Musk made a statement that rattled the market.

He said debt markets have effectively closed for companies that don't have significant revenue streams beyond data centers. He also warned that more than 200 neocloud companies will die out, with only a few surviving.

"What exactly are neoclouds?"

Put simply, they are companies that rent out computing power for AI workloads. Examples include CoreWeave, Nebius, and Iren.

And here's another important point: SpaceX also sells computing capacity from its own data centers, making it a direct competitor to these companies.

Their shares had already been falling. CoreWeave and Nebius had lost more than 30% in a month, while Iren was down 40%.

Following Musk's comments, their shares fell further before recovering later that same day.

Of course, there's another side to the story.

Read the full post

Greece Is Borrowing Cheaper Than France And Italy

steemychicken1 — Mon, 26 Oct 2026 20:03:15 GMT

What a truly strange week we just had. On one hand, the Athens Stock Exchange dropped 4.2% in just two days. And the main reason wasn’t something that happened locally. It was Paris. On the other hand, two rating decisions were released on Friday night—one for Greece and one for France. These ratings, combined with bond yield figures, point to something that a few years ago would have sounded like a joke: Greece is now borrowing at lower costs than France.

A Difficult Week

Let’s start with the Athens Stock Exchange (ATHEX). On Friday, the General Index closed at 2,530 points, down 2.22%. It was the lowest close since late July. Combined with Thursday's losses, the decline reached 4.2% in just two days. Banks suffered the most, dropping 4.52% on Friday alone and 6.6% over the entire week. Looking at the whole month of October, the General Index is down 7.6%.

“So what does France have to do with Greek banks, Christos?” you might ask. The answer lies in the bond markets. The French 10-year yield crossed 5% for the first time since 2002. When borrowing costs rise so sharply for a major eurozone economy, anxiety spreads to European banks—and from there, it reaches us. Combined with high oil prices, that was more than enough for many investors to hit the sell button.

However, it’s worth noting that even after this drop, the General Index remains up 19% since the start of the year.

What the Rating Agencies Decided

And that brings us to Friday’s credit ratings.

S&P kept Greece at BBB with a stable outlook. The numbers in the report are very interesting:

S&P projects a primary surplus of 3.8% of GDP for this year.
An overall budget surplus of 0.8%, which is roughly one percentage point above the original target.
Through August, the budget was running €1.1 billion ahead of target, driven by tourism, VAT revenues, falling unemployment, and improved tax compliance.

What about debt? Net public debt is projected at 123% of GDP at the end of 2026—40 percentage points lower than in 2019. S&P sees it falling further to 107% by 2029.

Now let's look at France. Moody's kept France at Aa3, but with a negative outlook. The French deficit is heading toward 5.4% of GDP this year, with debt approaching 120%. Moody's made it clear: their rating decision hinges on France passing a 2027 budget that successfully curbs the deficit.

You might wonder... if nothing actually changed, why is this news? Because the market was fearing the worst. For Greece, "no change" means the agency wasn't spooked by the week's market volatility. For France, it simply means they bought a little extra time.

The Student Surpasses the Teacher

This is where things get even more fascinating.

Take a look at 10-year bond yields:

France: 5.03%
Italy: 4.59%
Lithuania: 4.50%
Belgium: 4.44%
Malta: 4.42%
Greece: 4.40%

Yes, you read that right. Greece is currently borrowing at lower rates than five eurozone countries, including France and Italy.

What does this actually mean? Put simply, a bond yield represents the "interest rate" at which a country borrows. The safer a country appears to investors, the cheaper it is for that country to borrow.

To see this even more clearly, we can look at the spread—the difference between a country's borrowing cost and Germany's. On October 21, the Greek spread stood at around 100 basis points. Italy's was 113 to 117, while France's was 150 to 157.

It’s not just about bonds, either. S&P estimates that by 2029, Greece’s per capita GDP will reach approximately 55% of the EU average, up from 47% in 2019. The country that was once Europe's "black sheep" now runs a budget surplus, while France—once one of the "teachers"—is struggling to pass a budget.

It’s Not All Smooth Sailing

Of course, there is a big "but." S&P itself highlights several risks:

High external deficits: Greece's current account deficit remains elevated.
Energy shocks: Potential spillovers from ongoing conflict in the Middle East.
Government spending: Spending is already running above budget, and S&P is concerned this trend could continue into 2027–2028 after Recovery and Resilience Facility (RRF) funds wind down.

What lies ahead? A few key milestones:

Read the full post

One of My Strongest Convictions

borsengelaber — Sun, 25 Oct 2026 09:59:39 GMT

What am I convinced of?

Some convictions take years to build, and are robust to change. One of mine is that insurance remains indispensable in an increasingly uncertain world. I believe Allianz is exceptionally well-positioned in this sector, with what I consider to be outstanding management. Oliver Bäte and Michael Diekmann have done a great job over many years.

That’s why Allianz has been a fixture in my portfolio for nearly ten years. The stock has tripled over the past decade and gained more than 100% since 2021 alone. Add to that a dividend that increases year after year, and I see plenty of reasons to stay invested.

And if the market takes a serious hit? I’d buy more, as long as my investment thesis remains intact.

What are you convinced of?

Unreasonable spending or high demand?

steemychicken1 — Fri, 23 Oct 2026 19:12:27 GMT

AI Demand Is Booming, but Money Is Becoming the Problem

Two of the biggest CEOs in technology have spoken about AI.

One is Arvind Krishna of IBM. The other is Jensen Huang of Nvidia. And each described something that seemed completely different.

Krishna said companies are now scrutinizing what they actually get out of AI. Huang said demand is “off the charts.” But if we look a little more closely, both are reaching the same conclusion.

The problem is no longer demand. It is money.

IBM

IBM reported its quarterly results, and on paper, they were very good.

Revenue reached $17.1 billion, beating market expectations of $16.84 billion. Earnings per share came in at $2.95, compared with analysts' expectations of $2.87. Software revenue increased 8% to $7.8 billion. Red Hat also grew by 11%, and the company raised its free cash flow target.

And the stock? It fell approximately 7% following the news.

You might be wondering, “Why did it fall if the numbers were so good?”

There are two reasons.

The first is guidance. IBM maintained its forecast for full-year revenue growth at 4% to 5%. It did not raise that forecast, as investors had hoped.

The second is something Krishna himself said. He explained that customers are becoming “much more conscious of the actual return on all their AI spending.” He went a step further, speaking about “AI spending that has gotten completely out of hand, without real returns.”

Yes, you read that correctly. These are the words of the CEO of a company that sells AI.

What does this mean in practice? Put simply, companies have started asking a very basic question:

“Okay, we spent the money. What did we get in return?”

This is known as ROI, or return on investment. And when buyers start scrutinizing every dollar, the entire AI market becomes more anxious about the prospects of the companies selling these solutions.

The results were good. But the market focused on just that one statement.

The Other Side of the Equation

Of course, Krishna did not present this as bad news for IBM. Quite the opposite. He described it as a “tailwind” for his company.

You might ask, how does that make sense?

Because customers do not want to abandon AI. They want to bring it under control. They are looking for help redesigning their processes and putting the brakes on costs. And IBM wants to provide that help.

Krishna also offered companies some advice: choose a small number of AI applications and implement them properly at scale, rather than running dozens of small experiments simultaneously.

Huang and Insatiable Demand

And this is where Jensen Huang enters the picture.

The Nvidia CEO spoke at GTC Berlin, and his message was completely different.

He said demand for so-called neoclouds is “off the charts.” In other words, it is extraordinary.

What exactly are neoclouds? Put simply, they are companies such as CoreWeave and Nebius. They buy enormous quantities of chips and rent computing power to anyone who needs it for AI.

But there is a big catch.

Huang also made a very important point: “What is missing in the middle is the working capital to fuel growth.”

In other words, the customers are there. The money needed to serve them is not sufficient.

And the market took notice.

CoreWeave fell 10%, while Nebius dropped 7.23%, as investors worried about their enormous spending requirements and debt. Nvidia itself closed down 4.4%, just one day after gaining approximately 2.5%.

Let's also mention that Huang turned his attention to Europe. “We're trying to kick-start the AI economy in Europe,” he said. According to Bloomberg, he also criticized Europe for falling so far behind in the race.

What Are Both CEOs Telling Us?

This is where things become even more interesting.

On one side, we have the buyer. Krishna says companies are looking more carefully at the bill.

On the other, we have the seller. Huang says the queue of customers is enormous, but the financing is missing.

Contradictory messages? On the surface, yes. But fundamentally, they are saying the same thing.

Neither CEO said that nobody wants AI. Both talked about money. One discussed how much value companies are getting from their spending. The other discussed who will provide the capital needed to meet demand.

So the market's question has changed.

It is no longer, “Will AI change everything?” It is now, “When will AI deliver returns, and who will pay for it?”

My short term Netflix investment might become a longer one

behiver — Fri, 23 Oct 2026 01:32:45 GMT

I have written a while ago that I jumped on Netflix (NFLX) on a lowest price in the past two years with the hope that it will be a short term investment. At that time the price was hovering around $69 and my exit criteria was for it to move towards the $80 mark, while the market was put the expectations at around $90. But then the Q3 financial reports came up and it seems that the price retreated from there which for me means that I either switch my strategy or wait for long.

Netflix (NFLX) decreased about 5.3% at the moment I have drafted this article. Basically a weaker than expected profit forecast drove a sharp decline, demonstrating that earnings guidance can outweigh otherwise positive market sentiment. The Q3 financial results showed healthy indicators like:

• Revenue: $12.87 billion, up 11.8% year-over-year (in line with Wall Street expectations).
• Net Income: $3.66 billion (up from $2.55 billion in Q3 2025).
• Earnings Per Share (EPS): $0.87 (beats consensus estimate of $0.82).
• Operating Margin: 34.6% (compared to 28.2% in Q3 2025).
• Share Repurchases: Bought back 63.9 million shares for $4.8 billion in Q3, marking its largest quarter ever for stock repurchases.

While all these looked great on paper it seems that the investors sentiment took a dive which was sharply reflecting in the price. I still cannot understand how the market can react reverse to good financial results, but probably there is an underlying reason that I am not yet seeing. As an amateur investor I realize that there are many gaps in my strategies and this is one of them and something I will try to decipher in the future.

What this means for me is that the Netflix short term play of about 1-2 Months growth period, just translated as a longer play. I still see potential in it, so probably I will not liquidate my position while in the red or when retracing back to my position and will wait to see some gains from it. That will not happen overnight, but I think that taking measures like layoffs and restructuring (a reduction of roughly 1000 employees or about 6% of the workforce across product, technology, legal and HR), leadership changes (former Disney and Fox executive Peter Rice was appointed as Chief Content Officer effective October 26, 2026) and the ad supported expansion (plans to roll out its ad supported tier to 15 new countries starting in March 2027) will surely have a positive impact on the long term strategy. I just need the patience to see it through and just hold on it, which I will probably do.

PS: An update few hours before posting is that Netflix (NFLX) started already to recover from the previous day decline and it went up to $67,05 which means +3,09% regain. I am still in the red on it, but if the uptrend keeps up I might be in the green zone once again. That would get me back into a short term play, but my confidence to that happening is quite low at the moment.

Meta And Tesla Earnings

steemychicken1 — Thu, 22 Oct 2026 18:28:12 GMT

Yesterday, after Wall Street closed, it was the turn of two giants: Meta and Tesla.

Both are pouring enormous amounts of money into artificial intelligence. Both are seeing pressure on profitability. At Meta, earnings per share came in below expectations. At Tesla, net income fell by almost 30%.

And yet, both stocks rose in after-hours trading.

How is that possible?

META'S REVENUE

Let’s start with Meta. Quarterly revenue reached $64.6 billion, up 26% from a year ago and above expectations.

Where did all that growth come from? Advertising, of course. Ad impressions increased by 10%, while the average price per ad rose by 14%. In other words, more ads, and more expensive ones.

There was, however, one big catch. Earnings per share came in at $3.83, below expectations. Why? Because total expenses surged by 68%. And included in that figure was a $9.9 billion charge related to legal matters. Yes, you read that correctly.

What about users? Meta's apps had 3.64 billion daily active users, slightly below the 3.65 billion analysts had expected.

Nevertheless, everyone's attention is focused elsewhere: artificial intelligence.

In September, Meta launched Muse, a personal assistant that can shop and make appointments. Muse quickly climbed to the top of the app charts and helped the stock deliver its best month since 2022.

More recently, Meta introduced Muse Wonder, its first frontier AI model. The company says it can compete with ChatGPT and Claude. If that claim holds up, it would be a remarkable turnaround.

“Our investments are paying off,” said Mark Zuckerberg.

WHAT TO EXPECT GOING FORWARD

Now, let's look at what's coming next.

For the fourth quarter, Meta expects revenue of $73 billion to $76 billion. The midpoint of that range is above the approximately $73.7 billion analysts had forecast.

For the full year 2026, capital expenditures are expected to reach $135 billion to $145 billion. Previously, the lower end of the range was $130 billion.

In other words, Meta isn't slowing down. It's raising the bar even further. And excluding the legal charge, the company still expects operating profit to be higher than last year.

Things get even more interesting here. Meta is creating a new class of shares: Class C shares, which carry no voting rights.

What does that mean in practice? Each shareholder will receive one new share for every share they currently own, similar to a two-for-one stock split.

The difference is that the new shares will not carry voting rights. Trading is scheduled to begin in January.

And why would Meta do this? The company says the shares will be used to raise capital, compensate employees, and potentially fund acquisitions. It also says the move will preserve its founder-led management structure.

And how did the market react? Positively. The stock rose between 3.5% and 4.5% in after-hours trading.

TESLA'S EARNINGS

Now let's turn to Tesla, where the picture is more complicated.

Adjusted earnings per share came in at $0.48, beating expectations. Revenue was nearly unchanged from a year earlier, at $28.05 billion, roughly in line with forecasts.

But let's dig a little deeper.

Cars, the heart of Tesla's business, generated $20.56 billion in revenue, down 3% from a year ago. The energy business fell even further, declining by 16%.

And net income? Down 29%, to $787 million.

Why did profits fall so sharply? Because Tesla is spending increasingly large amounts on robotics and artificial intelligence. Capital expenditures for the quarter reached $4.73 billion.

Meanwhile, its operating margin fell to 2.6%, compared with 5.8% a year ago. In other words, for every $100 in sales, Tesla keeps less than $3 in operating profit.

Of course, not everything was negative.

Gross margin rose to 19.6%, beating expectations. Tesla delivered 486,532 vehicles. Active Full Self-Driving (FSD) subscriptions surged by 67%, reaching 1.74 million.

Free cash flow also returned to positive territory, reaching $1.53 billion after turning negative in the second quarter.

However, it was still 62% lower than a year ago.

TALKS OF A TESLA-SPACEX MERGER

And this is where the robots enter the picture.

At Tesla's Fremont facility in California, where the company has been manufacturing cars, production of Optimus, its humanoid robot, has begun.

Read the full post

Two Giants Two Different Market Reactions

steemychicken1 — Wed, 21 Oct 2026 18:54:36 GMT

Yesterday brought two of the week's most important earnings reports, from two Wall Street giants that could hardly be more different.

On one side, Netflix. TV shows, movies, and subscriptions. On the other, SpaceX. Rockets, satellites, and... artificial intelligence.

Both companies reported earnings per share above analysts' expectations. And yet, the market reacted to them in completely different ways. Netflix shares fell, while SpaceX shares rose.

Netflix Earnings

Let's start with Netflix. Earnings per share came in at $0.87, compared with analysts' expectations of $0.82. Revenue reached $12.87 billion, exactly in line with expectations.

Revenue increased by 12% compared with the same period last year. What drove the growth? New subscribers and the price increases introduced in March. Netflix says subscribers responded to the price hikes exactly as expected. Customers remained loyal across all regions, and cancellations declined compared with last year.

Net income reached $3.66 billion, up from $2.55 billion a year earlier. The company did point out that some of this increase was due to the timing of expenses throughout the year.

Operating income also rose 37% to $4.58 billion, beating analysts' expectations of $4.27 billion.

Of course, not everything is rosy. Revenue grew at its slowest rate in three years.

"If the company beat expectations, what's the problem?" you might ask.

Why Netflix Shares Fell

The problem is what comes next.

For the fourth quarter, Netflix expects revenue of $13.4 billion, representing 12% growth. Analysts were expecting slightly more, at 12.23%. And earnings per share? $0.67, compared with expectations of $0.73.

For the full year 2026, Netflix expects revenue of $51.1 billion. That's at the lower end of the range it provided in the previous quarter and slightly below Wall Street's forecast of $51.2 billion.

Then there's advertising. Netflix had expected to generate approximately $3 billion in advertising revenue this year. It now expects around $2.7 billion. Why? Some of its advertising tools are rolling out more slowly than anticipated.

But that's not all. Last week, the company announced it would lay off 6% of its workforce, approximately 1,000 people. Bela Bajaria is stepping down as head of content, with former Disney executive Peter Rice taking over the role.

Viewing hours have stalled, while competition from YouTube continues to grow. The company itself acknowledges that investors are concerned about the growth in viewing hours.

And as if that weren't enough, Netflix has also lost the battle to acquire Warner Bros. Discovery's streaming and studio businesses.

The result? Netflix shares fell by as much as 6% in after-hours trading. At one point, they reached $68.70, much closer to their 52-week low of $65.08 than their high of $124.86.

In fact, the stock has fallen following each of its last five earnings reports.

SpaceX's Explosive Growth

Now let's turn to the second company. SpaceX, which went public in June, delivered a completely different story.

Revenue reached $14.6 billion, up from $5.6 billion a year earlier. That's an increase of 161%.

Analysts had expected revenue of $13 billion. Earnings per share came in at $0.35, compared with expectations of $0.16.

Net income reached $4.4 billion, compared with a loss of $1.1 billion during the same period last year.

Operating income stood at $2.8 billion. Adjusted EBITDA, which measures earnings before interest, taxes, depreciation, and amortization, reached $8.8 billion, an increase of 306%.

But the most impressive performance came from artificial intelligence.

SpaceX calls this division Super Intelligence. It generated $7.6 billion in revenue, up 830% in just one year.

Yes, you read that correctly. EIGHT HUNDRED AND THIRTY PERCENT.

Where did this revenue come from? New deals for cloud computing services, Cursor, an AI-powered coding startup that SpaceX acquired during the quarter for $60 billion, and Grok, which is being used by a growing number of businesses and individual users.

What does this mean?

The company everyone knows for its rockets now generates more than half of its revenue from artificial intelligence.

Starlink and Starship

Despite the AI boom, Starlink is also performing strongly.

The satellite internet business generated $5.2 billion in revenue, up 69% from a year earlier.

Revenue from individual subscribers increased by 57%, while revenue from businesses and government customers climbed 91%. Operating income also rose 99%.

And things get even more interesting here.

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