This update was written automatically with AI from market data and news wire reports, and published without review by a person.
Key Takeaways
- Federal Reserve holds rates at 3.75%–4.00% in a 10–2 vote, with Chair Kevin Warsh signaling that December's decision remains data-dependent amid ongoing inflation concerns.
- Microsoft (MSFT) shares rose after-hours on a massive 30% surge in cloud revenue ($63.9 billion), with Azure growth accelerating to 48%.
- Alphabet (GOOGL) fell in late trading despite a 103% jump in Cloud revenue, as Search and YouTube advertising figures came in below analyst expectations.
- Ford Motor (F) raised its full-year EBIT floor to $10.5 billion, reporting a Q3 earnings beat driven by strong performance in its Ford Pro commercial segment.
- FedEx (FDX) hiked its annual profit guidance to a range of $18.00–$18.60 per share, citing successful network optimization and structural cost reductions.
The S&P 500 closed 0.3% higher on Wednesday as investors digested a flurry of mega-cap earnings and a widely expected interest rate pause from the Federal Reserve. While the broader market ended in the green, the after-hours session saw a sharp divergence between tech giants. Microsoft (MSFT) gained ground on the back of robust AI-driven cloud demand, while Alphabet (GOOGL) faced selling pressure after its core advertising business missed targets.
Federal Reserve Chair Kevin Warsh maintained a neutral stance following the FOMC's decision to keep the benchmark rate at 3.75%–4.00%. The 10–2 vote included two hawkish dissents from Governor Lisa Cook and Cleveland Fed President Beth Hammack, who both favored a 25-basis-point hike. Warsh emphasized that future policy will depend on the economic outlook, leaving the door open for a December move if inflation remains stubborn.
Alphabet (GOOGL) CEO Sundar Pichai highlighted that the company has reached a half-trillion dollar annual revenue run rate, bolstered by the new AI model Argon, which has significantly accelerated internal code development. However, the stock slipped as Google Services revenue of $96.30 billion and YouTube ad revenue of $11.21 billion both fell short of Wall Street estimates. In contrast, Google Cloud revenue skyrocketed 103% to $30.71 billion, reflecting intense demand for AI infrastructure.
Microsoft (MSFT) delivered a cleaner beat, reporting Q1 cloud revenue of $63.9 billion, surpassing the $61.62 billion estimate. The company’s Azure platform saw growth accelerate to 48%, a figure that CEO Satya Nadella attributed to the rapid adoption of AI intelligence tools across industries. Despite the growth, Microsoft’s capital expenditure of $39.37 billion came in below the $45.93 billion analysts had projected, suggesting a more measured pace of infrastructure spending.
In the automotive sector, Ford Motor (F) reported adjusted EPS of $0.49, beating the $0.41 estimate. The company’s commercial unit, Ford Pro, remained a powerhouse with $1.7 billion in EBIT, while the Model e electric vehicle segment narrowed its losses to $1.06 billion. Ford now expects full-year adjusted EBIT between $10.5 billion and $11 billion, as it moves toward a target of 8% adjusted EBIT margins by 2029.
Logistics giant FedEx (FDX) also impressed, raising its full-year adjusted EPS guidance after reporting Q3 adjusted EPS of $3.74, well above the $3.42 consensus. The company is benefiting from higher package yields and its ongoing business optimization initiatives. Meanwhile, T-Mobile US (TMUS) and eBay (EBAY) both posted beats on the top and bottom lines, with T-Mobile adding 274,000 postpaid net accounts and eBay seeing Gross Merchandise Volume rise to $23.2 billion.
Automated market updates written with AI from market data and news wire reports, published without human review.