📊 Market Overview
Indexes are holding their levels as earnings season broadens beyond big tech, with market participation (the number of stocks rising, not just a few giants) continuing to improve. The biggest driver right now is strong reports from industrial and aerospace companies like GE Aerospace and RTX, which are beating expectations and raising forecasts. The one thing to watch today: Netflix reports after the bell tonight, and the market wants to see real profit growth — not just subscriber numbers.
📊 Market Snapshot
Earnings season is proving that companies outside of big tech are thriving, but inside AI the pressure to show actual returns on all that spending is getting real.
📈 The Big Picture
This earnings season is telling two stories at once. Outside of tech, companies are delivering: GE Aerospace posted $13.29 billion in revenue (above the $12.87 billion expected), RTX reported $24.97 billion in sales and raised its outlook, GM showed strong cash flow, and regional bank KeyCorp showed improving lending margins. This supports what traders call “broadening” — when gains spread across many sectors instead of being concentrated in a handful of tech giants.
Inside AI, however, cracks in the narrative are forming. Research firm Gartner reports that only 13% of corporate technology leaders say their organization has gotten meaningful value from AI so far, and 44% of CEOs are struggling to show financial returns on their AI investments — even as 75% plan to keep increasing spending. For your portfolio, this means companies that can prove they’re actually making money from AI (not just spending on it) are the ones the market will reward most.
📖 Term of the Day
Broadening — when stock market gains spread out across many different sectors and companies, instead of being driven by just a handful of big names. Why you care today: Strong earnings from aerospace, auto, and banking companies are showing that this broadening is real and not just a temporary rotation out of tech.
💼 Watchlist: 3 Stocks to Know Today
GE Aerospace (GE) — “The Order Machine”
GE beat revenue and profit expectations across the board, but the standout number is orders: $19 billion, up 49% from last year. The company also raised its full-year forecast, confirming that demand for aircraft engines and defense equipment remains very strong.
Vicor (VICR) — “The AI Power Play”
This lesser-known company makes power delivery components for AI data centers, and its revenue jumped 78% to $197 million while its order backlog surged 166% to $406 million. Vicor is expanding manufacturing capacity fivefold, but the risk is whether all that new capacity will actually get used.
CoreWeave (CRWV) — “The Caution Sign”
CoreWeave and similar companies that borrow heavily to build AI data centers remain risky. With Gartner showing most companies can’t yet prove AI returns, and credit costs for AI infrastructure operators staying elevated, these leveraged players are the most vulnerable if customers start pulling back on spending.
💬 Esther’s Take
