💻👨‍💻 Big Tech Earnings This Week!

Oct 26, 2025

Happy Sunday,

Hello to returning and new readers! We are now over 75,000 strong on this newsletter - and I hope you enjoy reading the bi-weekly updates as much as I love writing them.

Some personal news to start the introduction here… This weekend I had the pleasure of going down to Pebble Beach to play one round of golf at a course in that area, in addition to attending a wedding of a friend of mine. It was quite beautiful!

And if you haven’t yet watched the latest episode of “Roasting my Subscribers’ Investment Portfolios”, I recently filmed a collaboration with the Money Guy Show over in Franklin, Tennessee. We actually got to review three user-submitted portfolios. The video had some great chemistry between us, as well as good financial advice of course ;). The video will be linked at the end of this newsletter.

I’ve also been thinking about what types of goals I want to be setting for the year of 2026. I know that it’s still October of 2025, so it’s still a little bit early to be thinking about goals... But since I finished my one big goal for this year already (which was to run a marathon), it’s been top of mind. So next year, I might choose a different type of goal, perhaps not a physical one, but maybe more of a mental, or knowledge, or habit goal. If you have any fun goals or habits you’re trying to build - let me know by replying directly to this email.

Enjoy today’s edition - we have a LOT of big earnings reports this week in the tech world.

- Humphrey & Rickie

Market Report

Big Tech Earnings This Week To Decide Market Direction

The direction of the US stock market for the rest of the year is likely to be dictated this coming week, as earnings reports from five tech giants will be released: Microsoft, Alphabet, Meta, Amazon, and Apple.
- These five companies account for about a quarter of the S&P 500 Index.
While strong earnings reports so far this season have helped the broader S&P 500 rebound, investors will be laser-focused on the tech companies’ outlooks regarding their massive AI investments.
The three-year bull market has been fueled by AI spending, but a pause in the rally could occur if the companies fail to reassure the market about when these tens of billions of dollars in capital expenditures, projected to reach nearly $420 billion next year, will generate profitable returns.
- Though AI-related revenue growth is already becoming evident in areas like cloud computing and advertising, the spending still far outstrips current returns.
This heavy capital spending is projected to slow the Magnificent Seven’s (the five companies plus Nvidia and Tesla) profit growth to 14% for the third quarter, down from 27% in the previous quarter, though this is still nearly double the 8% growth expected for the broader S&P 500.

Fed’s Internal Debate Set to Intensify As Talks Turns to Further Cuts

The Federal Reserve is widely expected to deliver a second straight interest-rate cut this week to bolster a weakening US job market, a decision strongly signaled by Chair Jerome Powell’s recent comments on the “considerably softened” labor market.
- Financial markets are already heavily pricing in a quarter-point cut this week, another in December, and a third by March, which has propelled the Treasuries market to its best year since 2020.
Fresh data showing the underlying inflation rate slowed slightly in September reaffirms the immediate plan to ease policy, but the overall flat-lining of progress on cooling prices may complicate the case for further cuts beyond this week.
The push for a more extended easing cycle faces significant opposition from a faction of Fed officials who remain anxious about persistent inflation.
- These policymakers point to worries about a spike in services prices and the fact that inflation has been above the Fed’s 2% target for over four years, which could threaten the credibility of monetary policy.
With the ongoing government shutdown preventing the release of crucial economic data, officials still lack the clarity to deviate from the rate-cut path outlined in September, which projected two more cuts this year.

Trump Unveils Flurry of Asia Trade Deals Ahead of Xi Meeting

President Trump unveiled a series of framework trade deals with several Southeast Asian nations and Brazil during his trip to Asia, aiming to strengthen the US’s trade position ahead of a critical summit with Chinese President Xi Jinping.
The agreements, signed with countries including Thailand, Cambodia, Malaysia, and Vietnam, involve reciprocal tariff rollbacks, with these nations agreeing to drop barriers on US agricultural and industrial goods in exchange for promised exemptions from Trump’s retaliatory tariffs on their exports.
- Key deals include Cambodia agreeing to drop all tariffs on US food imports and Thailand signing a crucial minerals pact intended to give the US preferential access to rare earths.
The White House hopes these pacts, which are currently non-binding and short on definitive sectoral details, will bolster Trump’s hand in his impending negotiations with China.
The urgency for alternative trade partners and supply chains has been heightened by Beijing’s recent actions, including cutting off US soybean purchases and expanding restrictions on critical mineral exports, which have caused political and economic strain in the US.

Early US Earnings Point to Best Corporate Results in Four Years

The third-quarter earnings season is off to a remarkably strong start. So far, ~85% of S&P 500 companies that have reported have surpassed profit estimates, putting this season on track for the best performance since 2021.
- This high proportion of positive surprises is significant because analysts had already set higher expectations heading into the reporting period.
Strong results from companies across various sectors, including banks like Citi and manufacturers like General Motors, suggest that US corporate profits continue to remain resilient despite ongoing concerns about tariffs and an uncertain economy.