U.S. stock markets opened strongly on July 31, 2025, as standout earnings from tech giants Meta Platforms and Microsoft lifted investor sentiment and helped drive gains across major indices.
Meta Platforms reported a striking second-quarter performance, with revenue climbing approximately 22% year-over-year to nearly $47.5 billion. This result exceeded analyst expectations of around $44 billion. Earnings per share surged to $7.14, well above consensus estimates that hovered between $5.75 and $5.86. The company’s advertising revenue jumped 21%, signaling strong demand for its AI-enhanced ad placement systems. Meta’s stock rose nearly 11% in premarket trading, reflecting renewed confidence in its core business, which includes Instagram, Facebook, and WhatsApp. The company’s ongoing investments in AI infrastructure and monetization tools appear to be paying off, positioning it as a leader in digital advertising innovation.
Microsoft also delivered a robust earnings report that surpassed forecasts. The tech giant posted $76.4 billion in quarterly revenue, an 18% increase from the same period last year. Net income rose 24%, and its Intelligent Cloud division recorded an impressive 26% growth. Azure, Microsoft’s flagship cloud platform, saw revenues jump by 39%, reinforcing the company’s dominance in the enterprise cloud space. Following this performance, Microsoft’s market capitalization approached $4 trillion, making it the second U.S. company to reach that milestone, trailing only Nvidia. The company also announced plans to spend more than $100 billion in capital expenditures this fiscal year to expand its AI and cloud infrastructure.
The strong results from both Meta and Microsoft are being viewed as validation of Big Tech’s massive investments in artificial intelligence. Meta is expected to spend between $66 billion and $72 billion in capital expenditures this year, while Microsoft is expanding data center capacity and hiring AI specialists to maintain its lead in the space. These commitments reflect growing confidence in the long-term profitability of AI-powered services, particularly in digital advertising and cloud computing.
Despite the tech sector’s surge, broader market sentiment remains cautiously optimistic. Treasury yields have held steady, and a slight uptick in inflation has tempered expectations of a near-term interest rate cut from the Federal Reserve. While economic indicators suggest stability, investors remain alert to any signs of volatility or policy shifts.
The spotlight now turns to upcoming earnings reports from Apple and Amazon. Investors are watching closely to see if these companies can match the momentum demonstrated by Meta and Microsoft. Apple, which has shown steady iPhone sales, faces pressure from geopolitical uncertainty and supply chain dynamics. Amazon, meanwhile, is under scrutiny as its cloud unit, Amazon Web Services, has reported slower growth compared to rivals.
Overall, the strong performance from Meta and Microsoft has injected renewed energy into the market and reinforced optimism around the AI-driven growth strategies of leading tech firms. Their earnings have lifted the broader Nasdaq and S&P 500, providing a bullish tone to end the month. However, with macroeconomic conditions still in flux, investors remain selective and focused on upcoming corporate results.
