Investors are being more patient with some companies than others. Apple’s stock popped after it reported its earnings last week — even though the company’s AI spending won’t start paying off until the fall when Apple Intelligence debuts. Meta’s stock also went up, despite the fact that it’s still pumping cash into AI and mixed reality projects that are running at a loss.
Cash is buying them some time. Meta’s spending was offset by strong ad revenue. Apple made up for its spending by selling more iPads. Investors have cared more about returns now than big bets that will pay off in the future, but they seem to be willing to give companies a break if they’re still making money in what they’re known for.
But it didn’t take long for the post-results shine to fade. Lightspeed Commerce’s stock initially climbed after it reported last week — thanks to a 44% boost in payments, offsetting slower growth in its big bet on software — but then took a tumble. After that, it was a chaotic week for all tech stocks, as fears of a recession made investors wary of volatile industries — like, say, ones heavily invested in unproven tech.
