The latest Mag 7 earnings season has been a real stress test for Big Tech—and for the “AI boom” narrative that’s driven so much of the market’s gains. With only Nvidia left to report, we’ve seen a clear split: Microsoft, Meta, and Alphabet delivered strong numbers and rallied, while Tesla, Amazon, and Apple stumbled despite years of market leadership. This divergence is a wake-up call that even the most beloved names can’t all win at once, and that the market is getting pickier about what kind of growth it will reward.
For me, the biggest surprise was how little tolerance there was for anything less than perfection. Amazon and Apple posted solid results by any historical standard, but in this environment, merely “good” isn’t good enough—guidance, margins, and new growth levers matter more than ever. Tesla’s struggles, meanwhile, show that hype without consistent execution will get punished, even if the long-term vision is bold.
Does this reaffirm my faith in Big Tech? Yes and no. The AI boom is still very much alive—just look at Microsoft’s Azure, Meta’s ad targeting, and the massive capex plans from Alphabet. These companies are spending billions to stay at the cutting edge, and that spending is what keeps Nvidia, AMD, and the whole AI supply chain humming. But it’s no longer a rising tide that lifts all boats; the winners are separating from the pack, and “AI exposure” alone isn’t a get-rich-quick ticket anymore.
Bottom line: the AI boom is still the best long-term theme in the stock market, but the market is telling us to be selective, focus on execution, and not just buy any company with “AI” in the press release. The bar is higher, the market is smarter, and the next phase will reward those who innovate and deliver. For now, Nvidia’s upcoming report is the last word on whether the AI hype train has more room to run—or if even the best stories can get ahead of themselves.
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