Kyle Prevost, creator of 4 Steps to a Worry-Free Retirement, Canada’s DIY retirement planning course, shares financial headlines and offers context for Canadian investors.
Apple, Nvidia growth—no cap
Depending on the day you ask, the title of “most valuable company in the world” goes to either Apple or Nvidia. Both companies are trading at market capitalizations around $3.5 trillion (all figures in this section are in U.S. dollars). To put that in perspective, each company is worth more than the entire Canadian stock market listed on the Toronto Stock Exchange when you add up banks, energy companies, telecoms, REITs, miners and all other public Canadian firms.
When either company reports quarterly results, the market pays close attention.
Big tech earnings highlights
Key results from this week’s reports for major tech names.
- Apple (AAPL/NYSE): Earnings per share: $1.64 (consensus $1.60). Revenue: $94.93 billion (consensus $94.58 billion).
Apple’s segment breakdown for the quarter:
- iPhone revenue: $46.22 billion (estimated $45.47 billion)
- Computer revenue: $7.74 billion (estimated $7.82 billion)
- iPad revenue: $6.95 billion (estimated $7.09 billion)
- Other Products: $9.04 billion (estimated $9.21 billion)
- Services revenue: $24.97 billion (estimated $25.28 billion)
- Gross margin: 46.2% (estimated 46%)
iPhone sales remain the primary driver of Apple’s revenue, with iPhone 15 uptake still strong. China remains a concern for Apple: sales there were down slightly year over year.
Apple’s net income was affected by a $10.2 billion tax payment tied to a settlement in Ireland, yet the company still returned $29 billion to shareholders in the quarter through buybacks and dividends. Annualized, that quarter’s share repurchases plus dividends equates to roughly $116 billion. Because the strong cash generation was largely expected, the market reaction was muted and Apple shares fell about 2% in after-hours trading.
Amazon primed to profit
Amazon was the standout winner among tech earnings this week. (All figures in this section are in U.S. dollars.)
Amazon earnings highlights
Shares rose about 5% in after-hours trading following a notable earnings beat.
- Amazon (AMZN/NASDAQ): Earnings per share: $1.43 (consensus $0.14). Revenue: $134.4 billion (consensus $131.5 billion).
Amazon Web Services (AWS) continues to be the company’s high-margin engine, with AWS revenue up 19% to $27.4 billion for the quarter. Advertising revenues also climbed 19%, and overall operating profit grew 56% year over year to $17.4 billion, helped by workforce reductions totaling about 27,000 roles since 2022.
This week Amazon’s founder Jeff Bezos also made headlines in his role as owner of a major newspaper after blocking an editorial endorsement, which prompted a wave of subscription cancellations. While the episode generated public attention, there has been no clear evidence that the controversy affected Amazon’s sales or stock performance; Amazon customers continue to subscribe to Prime and use the company’s services.
Purchases of media properties by ultra-wealthy individuals—like Bezos’s buy of this newspaper or other high-profile media acquisitions—often draw attention. But media ownership and corporate earnings do not necessarily move in lockstep.
Microsoft, Meta and Google: Predictably incredible earnings
Other mega-cap tech companies also delivered strong results. Microsoft is trading near $3.2 trillion, Alphabet around $2.1 trillion and Meta about $1.5 trillion (U.S. dollar figures). These firms continue to post sizable revenue and profit gains driven largely by cloud computing and advertising.
Other Big Tech stock news highlights
Summary of this week’s results:
- Alphabet (GOOGL/NASDAQ): EPS $2.12 (consensus $1.51), revenue $88.27 billion (consensus $86.30 billion).
- Microsoft (MSFT/NASDAQ): EPS $3.30 (consensus $3.10), revenue $65.59 billion (consensus $64.51 billion).
- Meta (META/NASDAQ): EPS $6.03 (consensus $5.25), revenue $40.59 billion (consensus $40.29 billion).
Despite beating expectations, market reactions were mixed: Meta and Microsoft saw modest after-hours declines while Alphabet shares rose about 3%. These companies’ scale is difficult to grasp—the world has not seen organizations of this size and profitability before.
| Meta | Alphabet | Microsoft |
|---|---|---|
| • Net income rose 35% year over year, though that was the slowest growth in six fiscal quarters. • Reality Labs reported an operating loss of $4.4 billion in the quarter, a reminder that big investments can mask core advertising profitability. | • Growth was driven by a 35% increase in cloud revenue. • Advertising revenue rose about 12% year over year. | • Net income rose 11% year over year. • Cloud revenue increased by 33%. |
Two important takeaways:
- Microsoft is no longer “just a software company”; cloud and enterprise services are now the main growth engines, while Windows licensing grew only modestly.
- Big tech firms are ramping capital spending on property and equipment, much of it to acquire high-performance chips for AI workloads. That trend indirectly benefits Nvidia, which supplies many of those chips.
The market response was likely muted because executives cautioned about potential slower growth ahead. On the last trading day of the month, the Nasdaq fell sharply—a reminder that even strong earnings can be overshadowed by broader market volatility.
No big surprises for CNQ and CVE
On the Canadian front, major energy producers Canadian Natural Resources and Cenovus Energy released quarterly results with relatively predictable outcomes.
Canadian earnings highlights
Key results from Canadian energy companies:
- Canadian Natural Resources (CNQ/TSX): EPS $0.97 (consensus $0.91), revenue $8.89 billion (consensus $9.01 billion).
- Cenovus Energy (CVE/TSX): EPS $0.42 (consensus $0.42), revenue $15.18 billion (consensus $14.69 billion).
CNQ indicated it will reduce natural gas expansion plans in favor of heavier crude oil production, citing relatively low natural gas prices in Alberta and increased pipeline capacity as reasons for focusing on heavy oil.
Cenovus also referenced pipeline capacity as a factor. Increased export capacity tends to narrow the discount Canadian oil receives relative to U.S. benchmarks. Although Cenovus met earnings expectations, shares slipped after the report as the company outlined sizable capital spending plans over the next two years, followed by a shift toward maximizing free cash flow by 2027. Management said their plan is sustainable, including the current dividend yield, at roughly USD $45 WTI benchmark pricing; with WTI trading near $70 at the time of the report, heavy oil production remains profitable.
These Canadian energy results reflect the broader dynamic in the sector: pipeline capacity, global oil prices and capital allocation plans all influence producer profitability and investor reactions.
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