Markets Edge Higher as Tech Earnings Took the Spotlight
Markets are slightly up in premarket trading as investors digested strong earnings from major technology companies alongside the Federal Reserve’s decision to hold rates steady. Gains were led by Meta Platforms (META), which surged after issuing an upbeat sales outlook, and Tesla (TSLA), which advanced following a better-than-expected quarter, while Microsoft (MSFT) fell sharply on slower cloud growth and softer margin guidance. Attention now turns to Apple (AAPL), set to report results after the close.
Microsoft’s AI Push Tests Investor Patience
Microsoft (MSFT) is down more than -6.0% in premarket trading despite beating estimates in FQ2, as investors focused on signs of slowing cloud growth. CEO Satya Nadella framed the company as still early in a long AI adoption cycle, highlighting rapid expansion across cloud, infrastructure, and Copilot. Heavy AI investment is pressuring near-term margins, but management emphasized strong execution, deepening enterprise adoption, and MSFT’s role as core infrastructure for AI-driven productivity and economic growth.
Meta Bets Big on AI’s Next Act
Meta Platforms (META) is up more than +8.0% in premarket trading after reporting Q4 results and as Mark Zuckerberg painted 2026 as a breakout year for AI. He framed AI agents as finally becoming practical, unlocking entirely new products, smarter commerce, and more personalized experiences across META’s apps. The company is pushing toward “personal super intelligence,” blending AI with recommendations and ads. META is also refocusing Reality Labs on glasses and wearables.
Tesla Profit Falls as Focus Shifts to Robotaxis
Tesla (TSLA) is up over +2.0% in premarket trading despite another weak profit report, as investors looked past near-term pain toward Elon Musk’s long-term vision. Annual net income fell to $3.8B from $7.1B in 2024, with Q4 profit down more than -60% amid price cuts and intensifying competition. Musk announced plans to end Model S and Model X production and repurpose factories for robotaxis and humanoid robots, reinforcing TSLA’s pivot away from traditional EVs. The stock held up as markets focused on expanding robotaxi ambitions and a new $2B investment in Musk’s xAI, rather than declining auto fundamentals.
IBM Beats Estimates on Software and AI Momentum
IBM (IBM) is up over +8.0% in premarket trading after delivering a solid Q4, as software and AI demand continued to reshape the business. Revenue rose +12% YoY to $19.7B and EPS came in at $4.52, comfortably ahead of expectations. Growth was led by software, up +14% on automation and Red Hat, while infrastructure surprised with a +67% jump in IBM Z mainframes. Management struck a confident tone, guiding to more than +5% revenue growth in 2026 and pointing to a generative AI pipeline that has now surpassed $12.5B.
