😅 Meta is killing it right now

Today’s market performance🏆️

S&P 500: -1.84% 📉
Nasdaq: -2.43% 📉
Dow 30: -1.51% 📉
Russell 2000: -3.52% 📉

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TOP STORY
😅 Meta is killing it right now

Meta just crushed earnings (AGAIN).

• Earnings: $5.16 per share (vs. $4.73 per share expected) ✅ 

• Revenue: $39.07 billion (vs. $38.31 billion expected) ✅ 

• Net income: $13.47 billion vs. $7.79 billion a year earlier (up 73% year-over-year) 📈 

Another major W for Meta was digital ad sales increasing to $39.1 billion last quarter, up 22% from a year prior.

This uptick means a boatload of cash for Mark Zuckerberg, and it also means that the company’s heavy investment in AI could be helping to sell personalized ads with more precise targeting.

Meta is really starting to have pinpoint accuracy with its ads thanks to AI, but even though AI is a major help, it’s also expensive as hell.

Meta plans to spend between $37 billion and $40 billion in capital expenditures this year, including its blowout AI spending.

And these massive costs are only expected to go up from here.

While planning for next year, Meta expects significant capital expenditure growth in 2025 to support AI research and product development.

But before you, Frugal Frans, come out yelling at Zuck, understand that AI is the future.

As long as Meta continues blowing earnings out of the water, that's where Meta shareholders should want the company to invest.

LAYOFFS
✂️ Intel to lay off over 15,000 workers

After reporting a loss of over $1.6 billion dollars in Q2, Intel has decided it best to initiate a massive layoff plan.

In order to save a buck or two, Intel said it will implement a $10 billion cost savings plan for 2025 that will cut approximately 15% of its workforce, impacting between 15,000 and 19,000 jobs.

Damn, getting right down to business, what else is part of this overhaul plan?

• Reduce its R&D and marketing spend by billions each year through 2026.

• Reduce capital expenditures by more than 20 percent this year.

• Restructure to “stop non-essential work.”

• Review “all active projects and equipment” to ensure it’s not spending too much.

After the grisly plan was announced, Intel’s stock plummeted 27% in late morning trading, marking its second-worst day ever, only behind a 31% drop in July 1974.

I guess Wall Street isn’t a big fan of massive layoffs…

TECHNOLOGY
😕 Microsoft and OpenAI’s "situationship" just got more complicated

In Microsoft’s latest annual report, released earlier this week, the tech giant surprisingly added OpenAI to its list of competitors.

Surprising because Microsoft is the biggest investor in OpenAI, with around $13 billion invested in the company.

That’s pretty strange. Plus, Microsoft has a long-term partnership with OpenAI, serving as its exclusive cloud provider and using its AI models in products for commercial clients and consumers.

Usually, Microsoft names the same old fellow tech giants as competitors: Apple, Amazon, Meta, and Google.

You know the type.

But I guess they think that Sam Altman and his deadly blue backpack are starting to get a little too close to Microsoft’s impenetrable moat.

Why list them now, though? Well, it could be because OpenAI just unveiled a prototype of their new search engine, SearchGPT, which could eventually compete with Microsoft in AI offerings, as well as in search and news advertising.

But we’re not exactly sure if that’s the real reason.

An OpenAI spokesperson told CNBC that nothing has changed in their partnership with Microsoft and that Microsoft still remains a good partner to OpenAI.

However, to everyone else, it seems Microsoft just changed its relationship status with OpenAI from "in a relationship" to "it's complicated."