Wall Street is upbeat on tech megacaps, but big questions loom on AI spending, China, Trump tariffs

Market analysis reveals I find it compelling that Earnings season kicks off Wednesday with results from Alphabet and Tesla, ed by Meta, Microsoft, Amazon and Apple next week

Additionally, President Trump's tariffs and AI spending were the big topics last quarter and remain top of mind for investors

In this articleAAPLAMZNMSFTMETATSLAGOOGL your favorite stocksCREATE FREE ACCOUNTMark Zuckerberg, CEO of Meta Platforms Inc. ; from left, Lauren Sanchez; Jeff Bezos, founder of Amazon. ; Sundar Pichai, CEO of Alphabet Inc. ; and Elon Musk, CEO of Tesla Inc (which is quite significant). , during the 60th presidential inauguration in the rotunda of the U

Capitol in Washington, D

Julia Demaree Nikhinson | Bloomberg | Getty ImagesAs Alphabet and Tesla get set to kick off the industry's second-quarter earnings blitz on Wednesday, Wall Street appears to be feeling good

Furthermore, But what happens over the next 10 days will ly determine whether the rally has legs

Additionally, Ing Wednesday's earnings announcements, the rest of the megacaps issue results next week, except for Nvidia, which should report in late August

Meta and Microsoft report earnings next Wednesday, with Amazon and Apple set to a day later

Last reporting period, investors worried the strain of hefty tariffs on nology es and on whether big gambles on artificial intelligence would lead to returns for holders, or were signs of an inflating bubble

Nevertheless, Three months later, stocks have bounced back, but the the industry is still grappling with the fallout from President Donald Trump's erratic global tariff policies and uncertainty over where duties on imports will ultimately land, given current economic conditions

In contrast, Apple, Amazon and Alphabet all warned in the prior quarter that strained relationships with trading partners could weigh on fits, hurting duct sales and ad spending

Conversely, Here's what investors will be closely ing from the giants as earnings season commences, given current economic conditions

Camille Cohen | AFP | Getty ImagesAlphabet's dominant online ad took a big hit earlier this year as worries mounted that Trump's tariff plans could crimp spending

Those fears haven't subsided (quite telling)

Revenue growth is expected to come in at 11%, according to LSEG, which would be the slowest rate of expansion for any period in two years

Alphabet s have just turned positive for the year, still significantly lagging behind the Nasdaq

Furthermore, Last quarter, Alphabet narrowly beat estimates and fell short on YouTube revenue

Its chief officer also said trade policies would "cause a slight headwind" to the company's ads, primarily from retailers based in the Asia-Pacific region

At the same time, Analysts have suggested of late that the may be back on an upswing, thanks in part to advances in AI (fascinating analysis) (an important development)

Additionally, Deutsche Bank analysts noted acceleration in the second quarter, while analysts at Goldman Sachs said the company's is in the "midst of a multi-year transformation (this bears monitoring). "Read more CNBC newsU

In contrast, "As AI monetization continues to evolve, we believe Google will increasingly leverage its over twenty years of AI initiatives to continue expanding ROAS for its advertisers. " the analysts wrote

Cloud revenue remains another key focus for holders eager to see how AI tools are boosting a unit that's trying to keep pace with Amazon Web Services and Microsoft Azure

In contrast, Earlier this year, Alphabet said it would shell out $75 billion to beef up its data centers underpinning its AI and cloud (fascinating analysis)

Then there's the Waymo, which has been a major source of investment for years, given the current landscape

This leads to the conclusion that robotaxi service now operates in five major U

Earlier this month, Tesla reported a 14% year-over-year drop in second-quarter deries, marking a second straight quarterly decline

Nevertheless, Tesla is battling competition from Chinese and other EV makers that are offering cheaper alternatives, amid market uncertainty

With Tesla, the story always revolves heavily around CEO Elon Musk

What the re reveals is earnings call will be the first since Musk's public split with President Trump, considering recent developments

However, Some investors may tune into the call to hear if Musk has anything to say regarding his current plan to build a new political party in the U

Meanwhile, But most will be focused on the company's fundamentals and the many challenges it currently faces in trying to revitalize its EV sales, in today's market environment

Tesla has long mised an affordable new EV model that could help it fend off the competition

Another big topic will ly be Tesla's robotaxi efforts after the company launched a limited driverless ride-hail service in Austin, Texas last month

While the Tesla Robotaxi rollout was seen by fans as a positive sign for the company, Bank of America analysts say it has "immaterial financial ramifications, considering recent developments

Additionally, "MetaMark Zuckerberg, chief executive officer of Meta Platforms Inc

At the same time, , during the Meta Connect event on Wednesday, Sept

Moreover, Bloomberg | Bloomberg | Getty ImagesZuckerberg's AI spending spree has raised a lot of eyebrows

In addition to the hiring of Wang from Scale AI, Meta also brought on former GitHub CEO Nat Friedman and his partner Daniel Gross, who had been CEO of AI startup Safe Superintelligence, in light of current trends

Zuckerberg later announced the creation of Meta Superintelligence Labs, led by Wang and Friedman

And Meta's CEO said last week that he plans to invest "hundreds of billions of dollars" into AI compute infrastructure, with plans to bring its first supercluster online next year (noteworthy indeed), considering recent developments

The pressure is on Zuckerberg to show results, or at least offer a strategy that investors can support

Furthermore, "While the recent talent hires and focus in this area are notable — and we expect meaningful imvements in models and user-facing applications — the road to platform leadership in AI remains long and highly competitive," analysts at MoffettNathanson wrote in a recent report (this bears monitoring)

Furthermore, Analysts at Bank of America said they view Zuckerberg's ary as "sign of confidence" in the strength of the company's

Meta is expected to report revenue growth of 14 (this bears monitoring)

However, 5% for the second quarter, according to analysts surveyed by LSEG, which would be the slowest growth rate since mid-2023, and Wall Street jects deceleration over the next two quarters

Moreover, The Bank of America analysts wrote that Meta needs to "make a case for strong AI returns to drive multiple expansion. "MicrosoftMicrosoft Chairman and Chief Executive Officer Satya Nadella speaks during the Microsoft Build conference opening keynote in Seattle, Washington on May 19, 2025

Jason Redmond | Afp | Getty ImagesAzure remains the focal point at Microsoft

It's the that sparked CEO Satya Nadella's turnaround of the software maker over a decade ago, and is key to its ambitions in AI, where Microsoft has a tight but tense relationship with OpenAI

Nevertheless, Analysts still see plenty of strength in Azure

Additionally, However, Mizuho told clients "one larger workload repatriation" during the quarter, which means the return to a physical data center

On the other hand, BMO analysts cited input from experts, who said President Trump's DOGE effort has "made it more difficult to close Fed deals. "Amy Hood, Microsoft's finance chief, said in April that she expects 34% to 35% quarterly revenue growth for the current period from Azure and other cloud services

Additionally, For Microsoft, which started its new fiscal year on July 1, investors also await fresh spending guidance, amid market uncertainty

Moreover, Hood said in April that capital spending growth will slow (quite telling)

AppleApple CEO Tim Cook speaks during Apple's annual World Wide Developers Conference at the company's headquarters in Cupertino, California, U

Laure Andrillon | ReutersApple's biggest market may be the U (this bears monitoring)

Furthermore, , but the iPhone maker relies heavily on China and other Asian countries for parts and manufacturing for some of its most significant ducts

On the other hand, Additionally, The company was one of the est losers from Trump's aggressive tariff agenda, which threatened to hamper global trade and hike the costs of selling ducts in the U

Investors want more clarity on the company's strategy from here (an important development)

Nevertheless, In contrast, In recent weeks, Trump has also held talks with India and Vietnam, where Apple has shifted some duction in recent years

Revenue is expected to increase 4% from a year earlier, according to LSEG, roughly inline with recent performance

On the other hand, Apple refrained from offering guidance last quarter, but CEO Tim Cook said the company was expecting an additional $900 million in costs for the period that in June (something worth watching)

That was barring any changes to Trump's original tariff plans

The president lauded the company this year for its commitment to invest in U, given the current landscape

Last week, Apple announced a $500 million deal with MP Materials to beef up manufacturing of rare earth materials in the U

AmazonAmazon CEO Andy Jassy speaks at a company event in New York on Feb

However, Michael Nagle | Bloomberg | Getty ImagesAmazon's second-quarter results will offer fresh clues into how the e-commerce and cloud computing giant is navigating tariff uncertainty

Last quarter, Amazon forecast operating fit for the current period that was weaker than Wall Street anticipated

It called out "tariffs and trade policies," currency fluctuations and "recessionary fears" as factors that may affect its results

Conversely, Investors were spooked by the guidance, despite reassurances from CEO Andy Jassy that Amazon is well positioned to weather the levies and could even take from competitors, given its ability to offer low prices

Amazon said the company and many of its third-party sellers stocked up on inventory in anticipation of the tariffs

But once that inventory is sold through, new shipments from China and other countries could face higher import costs

Nevertheless, Cloud growth is another major point of focus for Amazon holders

Analysts are jecting the same year-over-year growth for the second period

Jassy said in May that the cloud was constrained by data center capacity limits around power and components AI chips

Moreover, "As fast as we actually put the capacity in, it's being consumed," Jassy told investors

He added that the company expects some of the constraints to ease up "as the year ceeds, given the current landscape

Meanwhile, "Amazon s are up 4% this year, in today's market environment. — CNBC's Jennifer Elias, Annie Palmer, Jordan Novet, Jonathan Vanian, Lora Kolodny and Kif Leswing contributed reporting