Meta and Microsoft stocks beat analyst expectations late yesterday evening, the tech giants reported in their latest earnings.
The news comes after weeks of economic instability because of President Donald Trump’s global trade tariffs on goods from other countries.
Meta, the parent company of Facebook, Instagram and WhatsApp, reported quarterly wins of $16.64 billion for January to March. The company’s revenue rose 16 percent at $42.31 billion, higher than Wall Street expectations of $41.4 billion.
Microsoft had a quarterly profit of $25.8 billion and revenue of $70.1 billion, also beating Wall Street forecasts of $68.4 billion.
AI was cited as a top cause of both companies performing well this quarter – both tech giants have invested heavily into their AI development in recent years.
Microsoft’s main AI offering comprises its natural language model Azure and its Gen AI tool Copilot. Microsoft is also an investor in OpenAI. Whilst Meta recently announced its own Meta AI would be available as an app, rivaling the likes of OpenAI’s ChatGPT.
According to Emma Cofer, Strategy Partner at global branding consultancy Lippincott, its Microsoft’s stakes in major AI players that have contributed to the recent earnings report. She says: “There is no doubt that the impacts of tariffs and other ongoing socio-economic pressures are creating a tricky environment for big tech.
“But Microsoft has historically ridden waves of change well. And with its evolving relationship with OpenAI and increased investment in data center capacity in Europe, it’s clear the company is on a quest to remain the steady, stalwart player in key growth categories like cloud computing, while preserving flexibility in the face of uncertainty. Yesterdays results indicate that the strategy has netted positive results thus far.”
News of the quarterly success sent the share value of AI companies up, including chip giant Nvidia, which saw shares rise 2.8 percent.
Nvidia, which is largely seen as the world’s leading AI chip manufacturer, recently said it was preparing to take a $5.5 billion hit after Trump’s administration announced it would be tightening rules around AI chips going to China.
Nvidia currently makes a ‘special’ semiconductor for the Chinese market to bypass export rules, this chip is no longer able to export under new regulations.
Big Tech shares experienced a rollercoaster after the US government’s tariffs were introduced. Microsoft and Meta’s quarterly earnings are likely to give investors some reassurance, and highlight the continued growth of AI investment.
