23.07.25 - Watch tech giants’ earnings

Tonight, after market close, the first two tech giants will report Q2 earnings: Alphabet and Tesla. They’re among a broader group of companies publishing results.

Markets: Both Alphabet and Tesla are trading slightly lower in pre-market, while tech futures show a modest gain at the time of writing.

My view: Expectations are high. Investors have priced in strong results, so even a small miss could trigger sharp downside. Given their weight in the Nasdaq, results may drive significant index moves and volatility.

On the other hand, if both deliver upside surprises, we could see US indices jump and set new record highs.

Tesla’s weakness in its core business, EV sales, is likely to persist. Despite this, speculative investors are increasingly focused on the company’s new robotaxi initiative, viewing it as a major future growth driver. However, competition in the autonomous mobility space is already intense, and success is far from guaranteed.

As for Alphabet, I expect that many companies may scale back marketing and advertising budgets in the current environment. In times of uncertainty, especially with the unresolved tariff conflict, cost control becomes a priority, which could weigh on Alphabet’s short-term revenue.

Remember: Speculation remains elevated. This environment can persist. But it can also reverse abruptly on any unexpected event.

Disclosure: Short position in Tesla

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