Editor
The current tech earnings rally shows no signs of fatigue, fueled by an insatiable global appetite for artificial intelligence that has sent semiconductor giants and infrastructure plays into overdrive. On Thursday, the market received its clearest signal yet that the AI boom is more than just hype; it’s a massive, revenue-generating engine.
Taiwan Semiconductor Manufacturing Co. (TSMC), the linchpin of the global chip supply chain, set the pace with a blistering 6.6% surge. The company didn’t just beat expectations—it dismantled them, posting a record 35% jump in fourth-quarter profit.
The TSMC Halo Effect
When the world’s most important chipmaker raises its hand to say business is good, the entire ecosystem listens. TSMC’s bullishness acted as a rising tide for the “picks and shovels” of the industry. ASML, the Dutch firm that builds the machines required to make these high-end chips, saw its shares jump 6%.
“You have to look at the capital expenditure,” says Marcus Thorne, a senior equity analyst at Global Vantage Securities. “TSMC isn’t just sitting on their cash; they are spending aggressively to keep up with AI demand. That’s a direct green light for companies like ASML and Dell.”
Indeed, Dell Technologies climbed nearly 2% after Barclays bumped it to “overweight.” The logic? Dell is no longer just a laptop company; it’s becoming an AI server powerhouse. Even the memory sector felt the heat, with Sandisk and Western Digital posting gains of 5% and 3.5%, respectively, as investors realized that smarter AI needs significantly more memory to function.
Divergence on Wall Street: BlackRock Wins, Goldman Stumbles
While the tech earnings rally stole the headlines, the financial sector offered a more nuanced story of the economy’s health.
BlackRock, the titan of asset management, proved its scale remains its greatest weapon. Reporting an adjusted profit of $13.16 per share—well ahead of the $12.21 analysts expected—the firm saw its stock climb 1.7%. Not to be outdone, Morgan Stanley also cleared its quarterly hurdles, though its modest 1% gain suggests investors are still wary of the broader banking climate.
Goldman Sachs, however, provided the day’s cautionary tale. Shares slipped 1.4% following a muddy earnings report that left analysts scratching their heads. While the headline numbers looked solid, the lack of comparability to previous estimates created a “wait-and-see” sentiment that cooled investor enthusiasm.
Subscriptions and Space: The Outliers
Beyond the silicon and the vaults, consumer behavior is shifting. Spotify nudged 1% higher after announcing it would test the limits of user loyalty, raising its U.S. monthly subscription to $12.99. It’s a bold move in a crowded market, but one that suggests the streaming giant feels it has achieved “must-have” status.
In the stars, however, the mood was more somber. Rocket Lab fell 2.4% after a downgrade from KeyBanc. It’s a classic case of “buy the rumor, sell the news”—the analysts believe the company’s recent wins are already baked into the price, leaving little room for a near-term liftoff.
The Road Ahead
As the dust settles on this round of reports, the narrative is shifting from “will AI work?” to “who can build it fast enough?” The demand for infrastructure—from Nokia’s network equipment to DraftKings’ backend margin improvements—is the new North Star for investors.
“We are moving out of the speculative phase of AI and into the execution phase,” Thorne noted. “The companies that can actually deliver hardware and scalable services are the ones winning the tape right now.”
