Bailey Lipschultz, Bloomberg equities reporter who covers major tech movers, breaks down big earnings headlines. She unpacks Tesla’s $2B move into xAI and its strategic tie-up. She outlines Meta’s stronger-than-expected revenue and bullish guidance. She reviews Microsoft’s rising spending and cloud growth questions.
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insights INSIGHT
Tesla Backs xAI To Extend Beyond Cars
Tesla will invest about $2 billion into xAI as part of a preferred-share purchase and framework agreement.
Investors view this as proof that Tesla's vision extends beyond cars into AI and robotics, boosting the stock despite mixed operational results.
question_answer ANECDOTE
Musk Knows People, Investors Follow
Tim and Carol compare Tesla's xAI move to past Musk deals like the SolarCity acquisition as an example of Musk using connections.
They imply shareholders who bought into Musk's broader vision have been rewarded, making such insider-linked deals more palatable.
insights INSIGHT
Meta's Ad Strength Funds Big AI Spend
Meta beat revenue estimates and gave a strong sales forecast driven by advertising strength and heavy AI investment.
The market rewarded that clarity, sending Meta shares up more than 10% in after-hours trading.
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On this episode of Stock Movers, we focus on earnings from three major tech companies:
- Tesla (TSLA) plans to invest about $2 billion into xAI, giving Elon Musk’s artificial-intelligence startup a cash infusion despite a shareholder vote last year that failed to win approval. The automaker entered into an agreement this month to acquire preferred shares as part of xAI’s latest funding round, Tesla said Wednesday in a statement with fourth-quarter results. The companies also entered into a “framework agreement” to strengthen their relationship and “enhance Tesla’s ability to develop and deploy AI products and services into the physical world.” The shares rose in extended trading in New York. The stock rose 11% in 2025, underperforming the S&P 500 Index.
- Meta (META) topped projections for quarterly revenue and gave a strong forecast for the current period, boosted by a robust online advertising business that is making it possible for the company to invest in artificial intelligence at record levels this year. The social-media company’s shares jumped more than 11% in extended trading. Meta on Wednesday said first-quarter sales will be $53.5 billion to $56.5 billion, beating the $51.3 billion average analyst estimate. Meta shares gained as much as 11% in after-market trading after closing at $668.73.
- Microsoft (MSFT)’s spending surged to a record high and cloud sales growth slowed, sending the shares down amid investor concerns that it could take longer than expected for the company’s AI investments to pay off. Capital expenditures for the fiscal second quarter hit $37.5 billion, up 66% from a year earlier and exceeding analyst estimates for $36.2 billion. The Azure cloud-computing unit posted a 38% revenue gain during the quarter when adjusting for currency fluctuations, just meeting analysts’ projections. Microsoft shares fell about 5% in extended trading after closing at $481.63 in New York.
Stock Movers