Amazon surges on cloud boom as Apple falters on supply woes
Mega-cap tech earnings split sharply as Amazon’s cloud acceleration triggers heavy capital spending while Apple’s supply chain constraints darken its CEO transition outlook.
Amazon and Apple delivered starkly different quarters, exposing a rift in investor appetite for big technology. Amazon shares surged more than 10% premarket after topping revenue estimates, driven by a 37% jump in AWS sales, the cloud division's fastest growth since 2021. Apple fell over 7% before the bell as supply constraints forced a weak current-quarter forecast that overshadowed a 22% increase in iPhone sales.
The divergence highlights a market rewarding AI infrastructure investment over consumer hardware resilience. Amazon signaled its commitment by raising its 2026 capital expenditures forecast by $20 billion to $220 billion. Conversely, Apple's muted outlook cast a shadow over Tim Cook's final earnings call as CEO, though he told analysts the company has "enormous opportunities" in AI ahead of John Ternus taking the helm on Sept. 1.
The reactions followed a broader market rebound, with the Nasdaq Composite climbing 2.8% on Thursday to snap a six-day losing streak, supported by semiconductor stocks and a 15% surge in Microsoft that added roughly $450 billion to its market cap. However, underlying vulnerabilities in the AI trade surfaced as Leopold Aschenbrenner's Situational Awareness hedge fund was forced to unwind. The $45 billion fund, founded by the 25-year-old former OpenAI researcher, suffered steep losses from falling AI infrastructure stocks and short positions moving against it, prompting Citadel to buy its publicly traded assets to meet margin requirements.
Geopolitical tensions continued to ripple through commodities, driving a second-quarter profit surge for oil majors. Chevron's net income jumped nearly 400% from a year earlier to $12 billion, while Exxon's profits nearly doubled. U.S. crude futures averaged 27% higher between April and June compared to the prior quarter due to major supply disruptions caused by the Iran war. "We're kind of firing on all cylinders, which is good, because the world needs it," Chevron CEO Mike Wirth said.
The macro and market volatility is reinforcing a structural shift away from public listings. Five years after the 2021 IPO boom, companies are leveraging secondary markets for liquidity to avoid public scrutiny. "The secondaries market is acting as this pressure release valve to this artificial clock of having to go public," said Sunaina Sinha Haldea, global head of Private Capital Advisory at Raymond James. Thursday's market debuts validated those hesitations, with Reformation finishing roughly flat and Jersey Mike's closing nearly 6% below its IPO price.
