October 25, 2025

finance  
Microsoft Q1 Earnings, Intel Profit, Nvidia Investment

The artificial intelligence sector continues to see significant investment and development across major tech players and emerging companies. Microsoft is preparing to announce its Q1 fiscal year 2026 earnings on October 29, 2025, with investors keenly focused on AI-driven revenue growth. Analysts project $64.51 billion in revenue, with Azure expected to see 36% growth, bolstered by over $23 billion in recent contract wins. Meanwhile, billionaire investor Bill Ackman has made substantial investments in Amazon and Uber during the first half of 2025, seeing potential for AI to drive growth in Amazon's cloud and retail sectors, and autonomous driving to benefit Uber. Intel has reported a profitable third quarter for 2025, exceeding expectations with $0.23 per share in adjusted earnings, supported by billions in new investments from government, Nvidia, and SoftBank, though it faces competition in AI hardware. Oracle is also positioned for AI growth, with analysts maintaining a positive outlook and setting ambitious fiscal year 2030 targets of $65 billion in revenue and $15 EPS, driven by its AI-integrated cloud offerings and Exadata database machine. In the competitive AI landscape, Chinese models like Deepseek and Qwen are currently leading the Alpha Arena trading competition, outperforming established models such as ChatGPT and Gemini. While some AI stocks like Palantir may exhibit high valuations, the broader AI industry is projected for substantial growth, expanding from $279 billion in 2024 to an estimated $3.5 trillion by 2033, with Nvidia's gains considered reasonable in comparison to market trends. Market intelligence firm Sensor Tower has secured new investment to enhance its generative AI insights, aiming to deepen its leadership in AI-driven data. Cybersecurity firm Zscaler is also experiencing growth, with its share price up 75% year-to-date, driven by increased AI adoption and enterprise security budgets. Despite warnings of a potential AI bubble from some experts, others, like Goldman Sachs economist Joseph Briggs, view AI infrastructure investment as sustainable, though identifying future market leaders remains a challenge.

Key Takeaways

  • Microsoft anticipates announcing Q1 FY2026 earnings on October 29, 2025, with revenue projections around $64.51 billion, driven by AI and its Intelligent Cloud division.
  • Bill Ackman has significantly invested in Amazon and Uber in the first half of 2025, viewing AI as a key growth driver for Amazon and autonomous technology for Uber.
  • Intel reported a profitable Q3 2025, exceeding expectations with $0.23 adjusted earnings per share, boosted by new investments from the US government, Nvidia, and SoftBank.
  • Chinese AI models, including Deepseek and Qwen, are currently outperforming models like ChatGPT and Gemini in the Alpha Arena trading competition.
  • The overall AI industry is projected for substantial growth, expected to reach $3.5 trillion by 2033 from $279 billion in 2024.
  • Oracle is targeting $65 billion in revenue and $15 EPS by fiscal year 2030, leveraging AI in its cloud infrastructure and Exadata database.
  • Market intelligence firm Sensor Tower has received new investment to expand its generative AI capabilities and insights.
  • Cybersecurity firm Zscaler's share price has increased by 75% year-to-date, attributed to AI adoption and growing enterprise security budgets.
  • While some AI stocks face scrutiny for high valuations, AI infrastructure investment is considered sustainable by some analysts.
  • Microsoft has secured over $23 billion in new contracts, indicating strong demand for its AI and cloud services.

Microsoft Q1 2026 Earnings Preview: AI Growth Under Scrutiny

Microsoft is set to report its first quarter earnings for fiscal year 2026 on October 29, 2025. Investors are closely watching to see if the company's significant investments in Artificial Intelligence (AI) are leading to strong and consistent revenue growth. Analysts expect revenue of $64.51 billion, with the Intelligent Cloud division, including Azure, projected to be a major contributor. Microsoft has a history of exceeding earnings and revenue expectations, and its recent $23 billion in new contracts suggests high demand for its AI and cloud services.

Microsoft Q1 2026 Earnings: AI Investment Focus for Investors

Microsoft will announce its first quarter fiscal year 2026 results on October 29, 2025, with a key focus on AI-driven revenue growth. Analysts anticipate $64.51 billion in revenue, driven largely by the Intelligent Cloud division and Azure's projected 36% growth. The company has a strong track record of surpassing earnings and revenue estimates for the past eight quarters. Recent contract wins totaling over $23 billion highlight strong demand for Microsoft's AI and cloud offerings, which investors hope will justify current spending levels.

Bill Ackman Buys Amazon and Uber, Eyes Warren Buffett Success

Billionaire investor Bill Ackman, through his fund Pershing Square Capital Management, has significantly increased his stakes in Amazon and Uber Technologies in the first half of 2025. Ackman aims to build Howard Hughes Holdings into a modern-day Berkshire Hathaway. Amazon is seen as well-positioned to benefit from AI across its cloud and retail sectors, while Uber is expected to gain from autonomous driving technology. Pershing Square has delivered strong returns, outperforming the S&P 500 over the last five years.

Bill Ackman Invests Heavily in AI Stocks Amazon and Uber

Hedge fund manager Bill Ackman has made substantial investments in Amazon and Uber Technologies during the first half of 2025, aiming to replicate Warren Buffett's success with Berkshire Hathaway. Ackman's fund, Pershing Square Capital Management, now holds Amazon as its fourth-largest portfolio position and Uber as its largest. Amazon is expected to leverage AI in its cloud and retail businesses, while Uber is poised to benefit from advancements in autonomous driving technology. Ackman's fund has shown strong performance, outperforming the S&P 500 over the past five years.

Intel Turns Profitable Amid AI Demand and Major Investments

Intel reported a profitable third quarter for 2025, exceeding analyst expectations with adjusted earnings of $0.23 per share. This turnaround was driven by strong AI momentum, attracting billions in new investments from the US government, Nvidia, and SoftBank. Despite this positive development, Intel faces ongoing competition in the PC and server markets and lacks a direct AI accelerator rivaling Nvidia. The new investments provide flexibility, but challenges remain in scaling production and competing effectively in the rapidly evolving AI hardware landscape.

Oracle Poised for AI Growth, Analysts Maintain Positive Outlook

Oracle Corporation is recognized as a top American AI stock by analysts, with BMO Capital maintaining an Outperform rating and a $355 price target. The company has set ambitious fiscal year 2030 targets of $65 billion in revenue and $15 EPS, driven by heavy investment in AI and machine learning integrated into its cloud offerings. Oracle's Exadata database machine and Oracle Cloud Infrastructure (OCI) are designed for demanding AI workloads. Analysts are optimistic about Oracle's ability to capture market share in the growing AI sector due to its strong customer base and cloud infrastructure.

Chinese AI Models Lead Alpha Arena Trading Competition

Chinese AI models like Qwen and Deepseek are currently dominating the Alpha Arena trading competition, outperforming models such as ChatGPT and Gemini. Qwen holds first place with a unique strategy of trading only Bitcoin with high leverage. In contrast, ChatGPT is nearing liquidation, and Gemini has also suffered significant losses. Grok has dropped to fourth place, while Claude has opened the largest position in the contest's history. The Alpha Arena experiment combines AI, trading, and entertainment in the crypto space.

AI Boom: Bubble or Sustainable Growth for Investors?

While some individual AI stocks like Palantir may show bubble-like valuations, the overall AI industry's growth potential suggests sustained upward movement. The AI sector is projected to grow from $279 billion in 2024 to $3.5 trillion by 2033, indicating strong tailwinds. Major players like Nvidia, despite significant gains, have reasonable valuations compared to the broader market. However, smaller companies and quantum computing stocks might represent more extreme valuations. Investors should differentiate between true bubbles and the rapid growth common in tech sectors.

Sensor Tower Secures Investment for Generative AI Insights

Market intelligence firm Sensor Tower has received new, undisclosed investment from Shinhan Securities to fuel its generative AI ambitions. The funds will accelerate product innovation, particularly in web and generative AI datasets. Sensor Tower, which has seen 60% compound annual revenue growth over five years, aims to deepen its leadership in AI insights. CEO Oliver Yeh stated the investment will enhance their platform's AI capabilities, providing richer insights into the digital economy. Shinhan Securities views Sensor Tower as a category-defining company driving digital transformation.

Zscaler's Valuation Grows with AI Security Partnership

Cybersecurity firm Zscaler is experiencing growth driven by increased AI adoption and enterprise security budgets. The company's zero-trust security solutions and its expanded partnership with HCLTech highlight its market leadership. Zscaler's share price has risen 75% year-to-date, reflecting investor confidence. Analysts have been upgrading their ratings, indicating a positive outlook on the company's valuation. Zscaler's focus on zero-trust security and strategic alliances position it for continued success in the cybersecurity sector.

Top 10 US AI Stocks Analysts Recommend Buying

Experts like Lauren Taylor Wolfe of Impactive Capital warn that the current AI enthusiasm might resemble a bubble, with trillions invested but uncertain returns. However, Goldman Sachs economist Joseph Briggs believes AI infrastructure investment is sustainable, though identifying future winners remains challenging. This list highlights 10 American AI stocks analysts favor, based on average price target upside potential. AppLovin Corporation and Astera Labs, Inc. are among those with strong analyst backing, despite facing regulatory scrutiny or product mix shifts.

Sources

AI Microsoft Azure Intelligent Cloud Earnings Revenue Growth Bill Ackman Amazon Uber Berkshire Hathaway Autonomous Driving Intel AI Momentum Nvidia SoftBank AI Hardware Oracle Machine Learning Oracle Cloud Infrastructure (OCI) Chinese AI Models Alpha Arena Trading Competition Qwen Deepseek ChatGPT Gemini AI Stocks Bubble vs Growth Quantum Computing Sensor Tower Generative AI Market Intelligence Digital Economy Zscaler AI Security Cybersecurity Zero-Trust Security HCLTech AppLovin Corporation Astera Labs, Inc.