Tech Stock Roundup: Apple, Meta, and Microsoft Top Market Estimates in the First Quarter

Key Takeaways

• Apple, Meta, and Microsoft beat Wall Street expectations for the first quarter.
• Microsoft and Meta announced plans to invest billions in artificial intelligence (AI).
• Meanwhile, Toyota and Waymo signed a deal that steers clear of Tesla Autopilot issues.

Despite global trade tensions, regulatory shifts, and AI-fueled competition, America’s tech giants aren’t backing down.

In a week packed with strong earnings reports and bold investment pledges, Meta, Apple, and Microsoft all made clear: they’re betting big on the AI future.

Meta Unveils New Investments After Strong Q1

Meta posted stronger-than-expected first-quarter earnings and announced a higher capital expenditure forecast as it doubles down on AI infrastructure investments, despite headwinds from shifting trade policies and macro uncertainty.

Meta reported $42.3 billion in revenue in the first quarter, a 16% year-over-year increase, beating Wall Street’s consensus of $41.3 billion.

The strong results were accompanied by a bump in full-year capital expenditure guidance, now projected between $64 billion and $72 billion, up from a previous range of $60–65 billion.

Most of that spending will be directed toward AI-driven infrastructure, such as data centers, servers, and fiber optic networks.

“This updated outlook reflects additional data center investments to support our AI efforts as well as an increase in the expected cost of infrastructure hardware,” CFO Susan Li explained.

She emphasized Meta’s belief that its infrastructure capabilities will offer a long-term advantage in developing leading AI technologies and services.

However, Li also flagged economic uncertainties and shifting trade conditions as factors dampening ad spend, especially from Asia-based e-commerce exporters.

She noted a decline in U.S. ad revenue from this segment, attributing it to anticipation around the expiration of the de minimis import tax exemption on May 2.

Last week, Meta’s stock posted a 9.1% gain, bringing the share price close to $600 each.

Apple’s Earnings Smash Market Expectations

Apple topped expectations in its fiscal second quarter, with net income rising 4.8% year-over-year to $24.78 billion and EPS hitting $1.65, up from $1.53. Revenue rose 5.1% to $95.36 billion, beating the $94.66 billion forecast.

iPhone sales increased to $46.84 billion, while services surged to $26.65 billion from $23.87 billion. Mac and iPad also grew slightly, hitting $7.95 billion and $6.40 billion, respectively, though wearables dipped to $7.52 billion from $7.91 billion.

Regionally, the Americas grew to $40.13 billion in revenue, while China slipped slightly to $16.00 billion from $16.37 billion.

Due to evolving U.S. trade policy, Apple now faces a projected $900 million tariff burden in the June quarter.

CEO Tim Cook said supply-chain shifts mostly insulated the March quarter, but the outlook remains uncertain. CFO Kevan Parekh expects low-to-mid single-digit revenue growth in Q3.

Cook reaffirmed U.S. manufacturing plans, highlighting a new Texas facility and expanded chip production. He noted most U.S.-sold iPhones will be made in India this quarter, with Macs, iPads, Watches, and AirPods primarily coming from Vietnam.

Apple’s performance was below that of other Big Tech companies last week, with the company’s shares ending down by 1.9% to $203.72 per share.

Microsoft Plans To Invest $80 Billion in AI

Microsoft beat expectations in its latest quarter, driven by strong Azure cloud growth and a bullish outlook. The company reported earnings per share of $3.46, topping estimates of $3.22 and revenue of $70.07 billion, above the projected $68.42 billion.

For the next quarter, Microsoft expects revenue between $73.15 billion and $74.25 billion, exceeding the $72.26 billion consensus. Forecasts see Azure to grow 34–35% in constant currency, ahead of the 31.5% estimate.

While capital expenditures will rise in fiscal 2025, the growth rate will slow compared to 2024. The implied operating margin of 43.4% was just shy of the forecast of 43.5%.

For the fiscal third quarter ending March 31, revenue rose 13% year-over-year, with net income up 18% to $25.8 billion, or $2.94 per share, matching last year’s per-share result despite higher earnings.

CEO Satya Nadella said Microsoft plans to invest $80 billion in AI data centers in fiscal 2025, with potential cost variability tied to new tariffs.

CapEx hit $16.75 billion this quarter—a 53% jump and ahead of the $16.37 billion expected. Azure revenue rose 33%, with AI accounting for 16% of that growth, exceeding forecasts of 30% and 29%.

Microsoft outperformed peers on Wall Street last week, with its MSFT stock increasing by 11% to over $430 per share.

Waymo-Toyota Deal Steers Clear of Tesla Autopilot Issues

Amid increasing scrutiny of self-driving systems, Waymo and Toyota announced a preliminary agreement on April 29 to collaborate on autonomous technologies.

Despite working on self-driving tech since the 1990s, Toyota has lagged behind U.S. and Chinese competitors.

However, with Tesla’s Autopilot and Xiaomi’s Smart Drive under investigation after fatal accidents, Toyota’s renewed safety-first approach may offer a competitive edge.

Toyota Executive VP Hiroki Nakajima said the partnership supports the company’s commitment to a “zero-accident society,” adding it moves the world “one step closer” to that goal.

Tesla’s Autopilot, launched in 2014, has been tied to multiple crashes, including fatalities.

Tesla isn’t alone in facing scrutiny. In March, a fatal crash involving a Xiaomi SU7 in Anhui, China, led to tighter rules from the Ministry of Industry and Information Technology.

Automakers now need approval before rolling out over-the-air updates to assisted-driving features, and regulators have banned them from using terms like ‘smart’ or ‘autonomous’ in marketing.

Last week, TSLA stock increased by 0.8%, Toyota gained 3.4% in Tokyo, and Alphabet – the parent company of Waymo – rose by 1.2%.