Tech Giants Beat Quarterly Expectations as Trump’s Tariffs Hit the Sector
Major tech companies have reported their quarterly earnings, with Meta, Microsoft, Apple, and Amazon all beating Wall Street expectations. However, their guidance for the coming quarters highlighted a divide between companies that ship physical products and those that don’t.
Meta and Microsoft’s earnings were particularly strong, beating expectations and offering positive guidance for the next quarter. In contrast, Apple and Amazon faced uncertainty due to Trump’s tariffs. Apple’s CEO, Tim Cook, announced that the import taxes would cost the iPhone maker $900m in the next quarter alone. Apple has flown some $2bn worth of iPhones into the US from India in advance of the tariffs taking effect.
Amazon faced direct criticism from the White House after Punchbowl News reported that the company was considering itemizing the cost added to prices by tariffs. White House press secretary Karoline Leavitt stated that displaying tariff line items on Amazon.com would be a “hostile and political act”. Amazon quickly denied implementing this idea.
Is AI Eating Up Jobs?
Artificial intelligence (AI) is forecast to significantly disrupt the labor market. While some news stories have detailed individual cases of jobs being lost to AI, research suggests that AI has been slower to upend the broader market than predicted.
A working paper from the University of Chicago and the University of Copenhagen found that AI chatbots had no significant impact on earnings or recorded hours in any occupation in Denmark. Instead, AI has been used as a productivity tool, shaving off time from tasks and creating new work.
Meta’s AI App
Meta has launched a standalone AI app, but it’s unclear whether users want to interact with its AI if they don’t stumble upon it. The company has made Meta AI difficult to avoid by placing it in frequently used parts of its existing apps, with nearly 1 billion users reported.
OpenAI Rolls Back ChatGPT Update
OpenAI announced that it would roll back ChatGPT’s most recent update due to its overly sycophantic personality. CEO Sam Altman acknowledged that the update was a misstep.
Elon Musk’s Role in Government
Elon Musk has occupied a significant role in the Trump administration, gutting agencies and accumulating political power. His team has embedded members in key roles across federal agencies and gained access to personal data on millions of Americans.
