The Rundown - Meta & Microsoft Crush Earnings, Figma to Make Trading Debut

Episode Date: July 31, 2025

Stock market update for July 31, 2025.This video is for informational purposes only and reflects the views of the host and guest, not Public Holdings or its subsidiaries. Mentions of assets are not recommendations. Investing involves risk, including loss. Past performance does not guarantee future results. For full disclosures, visit ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Public.com/disclosures⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠.

Public.com presents the rundown. Your daily market update in under 10 minutes. My name is Zadadmani, and today is Thursday, July 31st. In today's episode, we'll recap yesterday's Fed meeting and what Jerome Powell said to send the markets lower. We'll also dive into the blowout earnings from meta and Microsoft and preview Figma's IPO, which starts trading today. Then stick around to the end of the show to find out why India is now shipping more smartphones to the U.S. than China. We got a great show for you today. Let's go. Markets were on a wild ride yesterday, with the S&P 500, ultimately losing 0.1% to end the day,

while the NASDAQ squeezed out a 0.1% gain. Now, things got off to a nice start yesterday after the latest GDP report came out, which showed that the U.S. economy grew by 3% in Q2, which was way better than the 2.3%. 3% that was expected. But then by the afternoon, Jerome Powell took the mic, which sent the markets into the red. We've been hyping up the Fed meeting all week. It wrapped up yesterday, and as expected, they left interest rates unchanged. No surprise there, but what did catch investors off guard was Jerome Powell's tone during his press conference. The markets were hoping for some kind of

signal or hint that rate cuts will start in the September meeting, but Jerome Powell really didn't strike that tone. In fact, he came out sounding pretty hawkish. I watched the entire press conference and the quote that stood out to me was when Jerome Powell said the Fed doesn't think the current interest rate level is restrictive or holding back the economy. He also reiterated that the Fed would take a wait and see approach when deciding when to cut rates, especially because of the uncertainty around tariffs and the impact they could have on inflation. You know, as of right now, the data isn't showing any meaningful impact that tariffs have had

on inflation, but Jerome Powell said it could still happen over the next few months. Now, the Fed will have two more months worth of inflation and jobs data before their next meeting in September, and by then we might have a clearer picture of the economic condition and the impact of tariffs on inflation. So we could still get a rate cut in September. The markets are pricing in a 50% chance of that, which is down from the 60% before the meeting. So we'll see what happens, but I think investors were kind of caught off guard with how hawkish Jerome Powell sounded. Let's run through some headlines. starting with Meta.

Meta reported earnings last night, and they crushed it, beating expectations across pretty much every metric. Revenues in Q2 jumped 22% to $47 billion, beating Wall Street estimates of $44 billion. And profits did even better. They were up 36% to $18 billion.

So clearly, Meta's core business, which is advertising on their social media apps, Facebook and Instagram, continues to see solid growth. And they don't expect, things to slow down anytime soon. Meta expects revenue growth to be between 17 to 24% in this current quarter. CEO Mark Zuckerberg credits the company's investments in AI for unlocking gains in their ad business. And that's why Zuck is tripling down on AI with massive investments.

And we already know and talk a lot about Zuck assembling his super intelligence team where he's handing out nine figure NBA size contracts to AI engineers to join his company. But beyond that, Meta plans to spend $72 billion this year on capital expenditure, most of that going towards building AI infrastructure like data centers. So yeah, Zuck is not backing down on AI at all. He's going all in and investors are loving it. Meta stock is up more than 10% this morning. You know, you got to hand it to Zuck. When he went all in on the Metaverse a few years ago, he got clowned on big time. His stock tanked and for good reason because the Metaverse was a flop. Nobody uses the Metaverse. In fact, Meta's reality.

Audi Labs division lost $4.5 billion in Q2 and has lost a total of nearly $70 billion since 2020. So I think Zuck realized that and he successfully pivoted the company to AI. And that pivot to AI is already benefiting their ads business. So you know what? Shout out to Zuck and shout out to everyone that's been buying up meta stock since 2022 when it was trading under $100 at one point because today it's nearing $800. Now let's talk about Microsoft, the other big tech companies report earnings last night. They also had blowout earnings thanks to AI supercharging their cloud business.

The headline was Microsoft's Azure Cloud Computing Division, which grew 39% last quarter better than the 34% that analysts had expected. Microsoft said that Azure raked in a record $75 billion in revenue during the past year. In fact, this is the first time that Microsoft has ever disclosed revenue figures for Azure. So you know the numbers must have been too good to keep it to themselves this time. And that growth is translating into profits, which also beat estimates. Net income was up 24% compared to Q2 of last year to over $27 billion. So all that growth in profit is a good way for Microsoft to justify the enormous investment

they continued to make in AI. The company's capital expenditure rose to $24 billion in Q2, which is 27% more than the previous year. And CFO Amy Hood said that next quarter, orders CAP-X will top at $30 billion, which would be 50% higher than last year. Overall, Microsoft is planning to spend over $120 billion this year alone on AI infrastructure. The company says that most of that is being directed towards long-term assets, which would be data centers rather than just chips. I mean, the demand for AI compute is still outpacing supply.

As a result, Microsoft stock is up nearly 9% this morning. And if that holds, Microsoft will become the second member of the $4 trillion. dollar market cap club joining nVIDIA and finally let's talk about another company riding the AI wave but in a more creative way figma the collaborative design platform is making its public debut today and this is shaping up to be one of the most hyped ipos of the year figma is pricing their IPO at $33 a share which is already up from the $30 to $32 range from earlier this week that pricing gives the company a valuation of just over $19 billion which is funny because that's pretty close to the $20 billion value that Adobe tried to acquire them at back in 2022.

That deal was ultimately scrapped after regulators blocked it for antitrust concerns. And look, don't be surprised if Figma exceeds the $20 billion valuation on day one because the demand for their IPO is off the charts. Bloomberg says their offering was 40x oversubscribed, which is twice as much interest as Circle and Chimsaw during their IPO window earlier this year. So this is shaping up to be a big one. Figma is expected to start trading later this morning or early afternoon. You can find their stock on the public app under ticker symbol FIG.

Honestly, kind of surprised that ticker symbol was still available. Let's talk about some stocks making moves today. Carvana's stock is booming after the online car retailer posted record breaking used car sales. In fact, Carvana's numbers were solid across the board. The revenues jumped 42% and net income was up since. Now, what's interesting about Carvana's business model is that most of its profits come from loan sales and not car sales. This past quarter, loan sales accounted for $274 million of its $308 million in profit. And that business model in some of its accounting practices related to loan bookings has stirred some controversy over the years,

and Carvana has become a target of some high-profile short sellers. But investors have had the last laugh over the years. Carvana's stock is up more than 15% this morning, and it's, up more than 10,000% since its 22 lows. And honestly, Carvana is like a meme stock that never stopped meaming. It just keeps going up. Now, on the flip side, Arm is not having a good day. Shares are sliding after the chip company reported weak revenue and issued soft guidance

that missed Wall Street estimates. Now, Arm's biggest moneymaker is smartphone royalties because their chip architecture powers basically every smartphone on the planet. But these days, smartphone demand has been pretty soft lately. and that weakness is hitting Arm's royalty revenue. And to make things tougher for them, Arm is also choosing to invest more heavily in building their own chips

and not just licensing their design. And that's adding more pressure to their profits. As a result, Arm stock is down about 8% this morning at the time of this recording. Let's wrap the show with a fun fact. India just passed China as the top exporter of smartphones to the US. According to new data from Canales,

44% of smartphones imported into the U.S. last quarter were made in India. That's up from just 13% a year ago. Meanwhile, China's share of imports collapsed to 25% down from over 60% last year. And the biggest reason for this shift is tariffs. Currently, there's a higher tariff rates on imports from China to the U.S. compared to India. But, you know, things could change again because President Trump recently threatened to raise tariffs on India. So we'll see how Apple and other smartphone makers respond to that.

Speaking of Apple, remember they report their earnings tonight. So we'll see if they address some of these tariff challenges on their earnings call. Well, all right, guys, that's the rundown for today. Hope you guys enjoyed today's episode. We got one more episode to wrap up this Action Pack week. Make sure you guys are subscribed for the podcast. And if you guys have like three extra seconds, consider giving us a five-star rating on Apple, Spotify, or wherever you listen to your podcast.

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