Key Takeaways
- Microsoft (MSFT) surged 16%, adding roughly $450 billion in market value—its largest single-day gain ever—following a fiscal Q4 blowout driven by 43% Azure growth and a $3.2 billion gain from its Anthropic investment.
- Apple (AAPL) reported record June-quarter revenue of $109.42 billion, beating estimates of $108.85 billion, though shares traded lower in after-hours as Services revenue ($30.74B) and Greater China sales ($18.82B) missed analyst targets.
- Japanese authorities and the Bank of Japan intervened in the foreign exchange market to support the Yen, causing the currency to surge as the U.S. dollar weakened following the Federal Reserve's decision to leave interest rates unchanged.
- Reddit (RDDT) executives highlighted a 40% jump in Ads API revenue since Q1, with active advertisers growing over 70% year-over-year, as the company prepares to expand its "Reddit Max" onboarding for small business advertisers.
- Geopolitical tensions spiked as a Russian ballistic missile destroyed a U.S.-owned AI drone factory in Kyiv, while Egyptian officials denied claims that Iran was behind a recent drone attack at the Port of Damietta.
Big Tech Earnings: AI Momentum vs. Segment Weakness
The "AI trade" returned with a vengeance on Thursday, led by a historic performance from Microsoft (MSFT). The software giant's market capitalization swelled after it reported that Azure cloud growth accelerated to 43%, easing investor fears regarding the massive capital expenditures required for artificial intelligence. Microsoft also disclosed it now has over 30 million paid Copilot seats, signaling that its AI software suite is finding significant commercial traction.
In contrast, Apple (AAPL) delivered a "beat and fade" report. While the company set June-quarter records for EPS ($2.02) and operating cash flow, investors focused on soft spots in the report. iPhone revenue of $54.25 billion beat expectations, but a miss in the high-margin Services segment and continued pressure in Greater China—where revenue fell short of the $19.58 billion estimate—weighed on the stock in extended trading.
Reddit and GoDaddy: Advertising and Small Business Trends
Reddit (RDDT) leadership expressed long-term confidence during their earnings call, noting that more than half of their revenue now stems from credit line relationships. COO Jen Wong emphasized the strength of the retail and travel verticals, while announcing plans to make Reddit Max the primary onboarding experience for SMB (small and medium-sized business) advertisers.
GoDaddy (GDDY) reported solid second-quarter results with total bookings of $1.4 billion, but the company provided a cautious outlook. Management narrowed its full-year revenue guidance to a range of $5.215 billion to $5.255 billion and warned that the third quarter would face a "tough comparison" against last year's strong aftermarket performance.
Global Markets: Forex Intervention and Infrastructure
The Japanese Yen saw its most dramatic surge since 2022 following suspected intervention by the Bank of Japan and the Ministry of Finance. The move came just a day after the Federal Reserve held rates steady, creating a window of dollar weakness that Japanese authorities utilized to pull the Yen back from 40-year lows.
In the hardware space, Super Micro Computer (SMCI) launched its new AI rack series under the DCBBS portfolio. The company announced it now has the capacity to deliver up to 3,000 AI racks per month, including 2,000 liquid-cooled units, to meet the skyrocketing demand for high-density data center infrastructure.
Geopolitical Risks: Strikes and Denials
Security concerns intensified as The Guardian reported the first known Russian strike on a U.S.-owned company in Ukraine. A ballistic missile destroyed a Kyiv factory owned by Terminal Autonomy, a Delaware-registered firm producing AI-guided attack drones. No fatalities were reported, but the incident marks a significant escalation in the targeting of foreign-owned defense assets.
Meanwhile, in the Middle East, Egyptian officials moved to de-escalate tensions following a drone attack on two ships at the Port of Damietta. Responding to reports from the Wall Street Journal, Egypt's Minister of Information denied claims that Cairo believes Iran was behind the incident, stating that investigations into the source of the drone are ongoing.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.