{"id":194020,"date":"2023-07-26T09:45:00","date_gmt":"2023-07-26T13:45:00","guid":{"rendered":"https:\/\/ibkrcampus.com\/?p=194020"},"modified":"2023-07-26T11:45:10","modified_gmt":"2023-07-26T15:45:10","slug":"alphabet-spells-success","status":"publish","type":"post","link":"https:\/\/www.interactivebrokers.com\/campus\/traders-insight\/securities\/stocks\/alphabet-spells-success\/","title":{"rendered":"Alphabet Spells Success"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\" id=\"h-what-s-going-on\">What&#8217;s going on?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Investors gave&nbsp;<a href=\"https:\/\/www.cnbc.com\/2023\/07\/25\/alphabet-googl-q2-earnings-report-2023.html#:~:text=Alphabet%20reported%20a%207%25%20increase,%2472.82%20billion%20expected%20by%20Refinitiv.\">Alphabet\u2019s<\/a>&nbsp;results an initial A+ on Tuesday, while&nbsp;<a href=\"https:\/\/www.cnbc.com\/2023\/07\/25\/microsoft-msft-q4-earnings-report-2023.html#:~:text=Microsoft%20shares%20moved%201%25%20lower,billion%20as%20expected%20by%20Refinitiv.\">Microsoft<\/a>&nbsp;got more of a middling B grade.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-what-does-this-mean\">What does this mean?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Microsoft\u2019s stock has rocketed nearly 50% this year, so it\u2019s safe to say the firm was facing some pretty lofty expectations on Tuesday. But the results, while decent-ish, didn\u2019t exactly set the world on fire \u2013 leading to a pretty low-key initial reaction. Mind you, Microsoft did manage to clock up better-than-expected revenue growth of 10% compared to the same quarter last year, and profit also outdid forecasts, jumping 20%. Plus, the company\u2019s crucial cloud business, Azure, grew 26% \u2013 slightly ahead of expectations, but still slower than the quarter before.<br><br>Meanwhile, Alphabet\u2019s results were met with a standing ovation. The stars of that show were YouTube, which was back in growth mode, and Google\u2019s own cloud business \u2013 which posted impressive growth of 28%.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-why-should-i-care\">Why should I care?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><em>For markets:&nbsp;<\/em><\/strong><em>Azure-sky thinking.<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Microsoft\u2019s main game plan involves selling its AI-boosted software, Copilot, now with a shiny new price tag of an extra $30 per user. But some fireworks might also happen in Microsoft\u2019s cloud business, Azure. As firms start letting AI loose, they\u2019ll need more computing power, and that\u2019s Azure\u2019s cue to step in. And sure, this past quarter\u2019s 26% growth isn\u2019t exactly crawling \u2013 but investors will be hoping for a return to the glory days when Azure used to sprint at a pace of 35% plus.<br><br><strong><em>Zooming out:&nbsp;<\/em><\/strong><em>Taking the temperature.<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Google\u2019s advertising revenue is a bit of a barometer for the economy. See, advertising\u2019s a cyclical business, meaning firms splurge and starve their ad spending depending on the broader state of affairs. So with Google\u2019s ad revenue growing again after a couple of tricky quarters \u2013 thanks in no small part to YouTube \u2013 maybe pundits will consider calling time on the US economic slowdown.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">&#8212;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Originally Posted July 25, 2023 &#8211; <a href=\"https:\/\/go.finimize.com\/wp\/news\/alphabet-spells-success\/\">Alphabet Spells Success<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Investors gave\u00a0Alphabet\u2019s\u00a0results an initial A+ on Tuesday, while\u00a0Microsoft\u00a0got more of a middling B grade.<\/p>\n","protected":false},"author":186,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[6,8,9,22,26,3],"tags":[267,564,1244,404],"contributors-categories":[13597],"class_list":["post-194020","post","type-post","status-publish","format-standard","category-north-america","category-region","category-securities","category-stocks","category-text-articles","category-traders-insight","tag-earnings","tag-google","tag-microsoft","tag-tech","contributors-categories-finimize"],"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.9 (Yoast SEO v27.8) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Alphabet Spells Success | Traders&#039; Insight<\/title>\n<meta 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