Tech giants beat Wall Street expectations after weeks of volatility in US stocks.
Tech giants Microsoft and Meta posted better-than-expected results in the first quarter of the year, offering some reprieve to investors after months of turbulence unleashed by United States President Donald Trump’s trade war.
Meta, the parent company of Facebook and Instagram, reported a net quarter profit of $16.64bn, or $6.43 per share, for the January–March period – up 35 percent year-on-year.
Revenue rose 16 percent, ending at $42.31bn and higher than Wall Street expectations of about $41.4bn.
Microsoft posted a net quarter profit of $25.8bn, or $3.46 per share, and up 18 percent year-on-year.
The company’s revenue came to $70.1bn, up 13 percent year-on-year and ahead of analysts’ expectations.
Both companies cited artificial intelligence (AI) as a major driver of growth, helping to ease investors’ concerns about a possible slowdown in demand for the burgeoning technology.
Meta recently incorporated AI tools into its advertising business, its top source of revenue, while Microsoft reported strong growth in its cloud computing business.
Google’s parent company, Alphabet, which has also invested heavily in AI, last week reported better-than-expected quarterly revenue of $90.23bn.
The results are a boost for the US tech sector, whose share prices have been on a rollercoaster ride since Trump returned to the White House on January 20.
The market value of the top seven US tech companies – Microsoft, Meta, Nvidia, Amazon, Tesla, Apple and Alphabet – plunged by 24 percent, or $4.2 trillion, in the first 100 days after Trump’s inauguration.
Trump’s tariffs, including a 145 percent duty on China, have disrupted businesses and unnerved investors, who are anxiously awaiting his next moves following his announcement of a 90-day pause on so-called “reciprocal” duties targeting almost all countries.
The US economy shrank 0.3 percent in the first quarter of 2025, the US Department of Commerce said on Wednesday, adding to fears that the US is likely to tip into a recession this year.
In an earnings call with investors, CEO Mark Zuckerberg said that Meta is “well-positioned to navigate the macroeconomic uncertainty” of recent months.
The company also released a standalone AI app this week, MetaAI, and plans to spend between $64bn and $72bn on capital expenditure in 2025 to complete construction on data centres.