Microsoft CEO Satya Nadella (Jason Redmond/Getty Images)

Microsoft joins the $4 trillion club, plans to spend over $30 billion on capex this quarter

Microsoft’s blowout FY25 Q4 earnings powered a surge in shares making it the second $4 trillion company, joining an elite club shared only by Nvidia.

Jon Keegan

7/31/25 9:12AM

Microsoft had a blowout fiscal fourth quarter, beating estimates for earnings and revenue. In premarket trading, shares surged over 8%, pushing the valuation above $4 trillion, an elite club only shared with Nvidia.

On the earnings call last night, CEO Satya Nadella summed up the company’s impressive fiscal year performance:

“It was a very strong close to what was a record fiscal year for us. All up, Microsoft Cloud surpassed $168 billion in annual revenue, up 23%. The rate of innovation and the speed of diffusion is unlike anything we’ve seen.”

Like Nvidia, Microsoft’s surging valuation is powered by white-hot demand for AI computing. The legacy tech giant has nimbly positioned itself for success in a fast-moving, young AI industry:

🤝 It has a big (if strained) partnership with market leader OpenAI.
☁️ Most importantly, Microsoft’s Azure cloud computing platform and massive data centers (over 400 of them) are AI-model-agnostic — they will sell computing for pretty much any company and any AI model or application.

Indeed, Azure’s performance was a big driver of growth for the quarter, with Azure (and other cloud services) revenue growth increasing 39% year on year.

For the first time, the company revealed how much money Azure has made: more than $75 billion in annual revenue.

That number could have been even higher if supply weren’t an issue.

“While we brought additional data center capacity online this quarter, demand remains higher than supply,” CFO Amy Hood said.

The demand is so high for Microsoft’s cloud computing services that it has a significant contracted backlog — $368 billion worth.

To catch up with that demand, Hood said on the earnings call last night that the company continues to spend huge on capex: “We expect Q1 capital expenditures to be over $30 billion driven by the continued strong demand signals we see.”

But Hood cautioned that the capex seen in FY25 might not be the norm:

“Capital expenditure growth, as we shared last quarter, will moderate compared to FY25 with a greater mix of short-lived assets. Due to the timing of delivery of additional capacity in H1, including large finance lease sites, we expect growth rates in H1 will be higher than in H2.”

Update (10:23 a.m. ET): a previous version of this piece attributed Google’s AI model to Microsoft.

Max Knoblauch

11m

Nio surges to an 11-month high following an upgrade from UBS ahead of its new SUV launch

Chinese EV maker Nio is climbing for the fourth straight trading day, following an upgrade from UBS to buy from neutral. Nio’s nearly 7% jump propelled the stock to its highest level since last October.

UBS also bumped its price target for Nio up to $8.50, a 37% hike.

Nio will begin deliveries of its new ES8 SUV this weekend, priced to compete with Tesla’s Model Y. Last week, the EV maker said it planned to raise up to $1 billion on a share offering.

According to UBS analyst Paul Gong, Nio’s latest products “could further attract consumers after the US $1 billion equity offerings strengthened visibility on its healthy operations.”

J. Edward Moreno

33m

Moderna is up on the release of positive results for reformulated Covid vaccine

Moderna rose on Tuesday after it announced encouraging trial results for its next Covid-19 vaccine.

The data from its phase 4 clinical trial showed its 2025-2026 formula of its Covid-19 vaccine, which targets a new variant and was recently approved by the FDA with some limitations, produced a strong immune response among people ages 12 through 64. Covid vaccine sales account for virtually all of Moderna's revenue.

The company has had a tumultuous year as the Trump administration makes moves to limit who is able to access the vaccine. Last month, the FDA limited approval for the coronavirus vaccine to higher-risk populations; previously, anyone older than 6 months was eligible for it.

Max Knoblauch

37m

Rivian climbs as it breaks ground on a $5 billion EV plant that could produce 200,000 vehicles a year by 2028

EV tax credits may be ending this month, but Rivian’s still optimistic about future demand.

The electric vehicle maker on Tuesday broke ground on it’s delayed, $5 billion Georgia plant that it says will be able to produce 200,000 vehicles per year by 2028 (Rivian expects to deliver up to 46,000 EVs this year). Its shares climbed more than 6%.

The plant will create 7,500 permanent jobs once complete, according to Rivian, with the first phase of production beginning next year.

2026 also marks the planned launch year for Rivian’s R2 electric SUV, expected to start around $45,000 and compete with Tesla’s Model Y. Earlier this month, Lucid confirmed that it too would be creating a roughly $50,000 electric SUV.

If it seems like an odd time to build an EV plant, it probably is. But unlike larger rivals GM and Honda, Rivian doesn’t have the ability to scale back its EV ambitions — they’re the only vehicles the automaker produces. Last month, the company posted a steeper loss than analysts expected, losing $1.12 billion over its second quarter.

It's 'do or die' for electric vehicle maker Rivian as it breaks ground on a $5 billion plant

The plant will create 7,500 permanent jobs once complete, according to Rivian, with the first phase of production beginning next year.

Luke Kawa

Plug Power jumps on elevated call demand

Plug Power is up today amid a wave of bullish options action.

As of 11:40 a.m. ET, 28,819 calls have traded, nearly double the 20-day average of 14,527.

The two contracts seeing the most activity are calls with a strike price of $2 that expire on October 17 and on this Friday.

The put/call ratio is below 0.13 as of 11:40 a.m., versus a 20-day average of 0.32.

Nia Warfield

Warner Bros. Discovery dips after TD Cowen downgrade cools deal frenzy

Warner Bros. Discovery shares were down over 8% after TD Cowen downgraded the stock from “buy” to “hold,” even as it kept its $14 price target.

The dip comes on the heels of a sharp rally sparked by reports that Paramount Skydance may bid for the media giant. TD says that while a successful bid could send WBD north of $20, the current risk-reward feels lopsided. If nothing materializes, shares could slip back toward $11 to $12.

Analysts noted that much of the upside from deal chatter is already priced in. TD also flagged limited potential buyers if Paramount Skydance fell though and the lack of concrete details around a bid. In short: the rumor mill has been driving the stock, but fundamentals haven’t clearly caught up.

Reaction has been mixed: last week, Wells Fargo reiterated an equal-weight rating on the stock and hiked its price target to $14 from $13.

Even with today’s dip, WBD shares are still up 67% year to date.