Premarket trading showed a bifurcated set of reactions among megacap tech and major industrials as investors digested a flood of quarterly results and guidance around capital spending and cloud demand. The day’s activity underscored how earnings narratives and AI investment plans are shaping market expectations in the near term.
According to CNBC, Meta Platforms slid about 9% after the company raised its full-year capital expenditures guidance to a range of $125 billion to $145 billion, raising concerns about the pace and scale of its AI-related spending even as the company delivered a better-than-expected first-quarter report. In contrast, Eli Lilly surged nearly 8% on stronger-than-forecast first-quarter earnings and revenue, with the drugmaker lifting its full-year sales outlook to between $82 billion and $85 billion, up from a prior $80 billion to $83 billion.
Alphabet also advanced, with shares up roughly 7.4% after reporting first-quarter revenue of $109.9 billion, topping the LSEG-poll of $107.2 billion. Google Cloud revenue jumped 63% year over year to $20.02 billion, above StreetAccount’s estimate of $18.05 billion. Microsoft, meanwhile, slipped about 2% as investors weighed a quarter in which capital expenditures and finance leases for its fiscal third quarter totaled $31.9 billion, below the Visible Alpha consensus of $34.9 billion. The early move suggested a rotation around AI-related spending and enterprise demand even as the company continued to post solid earnings and revenue.
In the travel and consumer space, Royal Caribbean rose about 7% after posting first-quarter results that beat on earnings but came in just shy of revenue consensus. The company’s adjusted earnings were $3.60 per share versus the FactSet-compiled $3.20 expectation, while revenue was $4.45 billion against a $4.46 billion forecast. Among industrials, Caterpillar climbed about 4.5% after topping both top- and bottom-line expectations for the first quarter, posting adjusted earnings of $5.54 per share on revenue of $17.42 billion, versus consensus estimates of roughly $4.62 on $16.61 billion in revenue.
Tech and consumer names also showed strength: Amazon rose about 3% after first-quarter results that surpassed expectations, delivering earnings of $2.78 per share on revenue of $181.52 billion versus estimates for about $1.64 in EPS and $177.3 billion in revenue. Merck advanced about 3.4% after first-quarter results that beat expectations, with adjusted earnings of a loss of $1.28 per share versus the anticipated $1.51 loss, and revenue of $16.29 billion ahead of a $15.82 billion forecast. Qualcomm jumped roughly 11% after second-quarter results topped expectations, with adjusted per-share earnings of $2.65 against the consensus of $2.56 and a stronger-than-expected backdrop for chips tied to AI workloads.
Stellantis was the notable exception among large-caps, slipping about 5% despite first-quarter operating income that more than tripled and topped expectations. One analyst described the results as “messy,” citing significant moving parts related to provisions and tariffs. Carvana, the online used-car marketplace, vaulted more than 10% on expectations of a sequential improvement in retail units sold and adjusted EBITDA in the second quarter; first-quarter retail unit sales came in at 187,393, above StreetAccount’s 182,394 estimate.
On the auto side, Ford Motor gave back roughly 5% after lifting its 2026 guidance while posting first-quarter revenue of $39.82 billion, topping the consensus estimate of $38.82 billion. In the chip sector, KLA Corp fell about 5% after its fourth-quarter guidance came in below expectations, with adjusted earnings guidance in the $8.87 to $10.87 per share band versus a consensus of $9.80 and mid-point revenue near the Street estimate of $3.575 billion.
Restaurant and grocery groups were mixed but constructive in some cases. Chipotle Mexican Grill rose more than 4% after quarterly same-store sales rose 0.5%, better than the expected decline of 0.7%. Sprouts Farmers Market advanced about 3% after beating on both earnings and revenue and lifting its full-year 2026 earnings guidance to $5.32 to $5.48 per share from $5.28 to $5.44.
Teladoc Health dropped just under 9% after reporting a first-quarter loss of $0.36 per share, wider than the $0.34 expected by FactSet, though revenue did surpass forecasts. Equinix slipped about 5% despite raising its 2026 forecast; the data-center operator guided revenue for the year to $10.144 billion to $10.244 billion, a touch above prior guidance, but analysts’ consensus was near the top end of that range. Equinix also raised adjusted funds from operations guidance to $42.31 to $43.11 per share, versus a consensus around $42.52.
Wyndham Hotels & Resorts gained a bit more than 2% after posting first-quarter adjusted earnings of 96 cents per share on revenue of $327 million, both above FactSet expectations of 86 cents and $322 million. Carrier Global rose about 4% after its first-quarter report beat on both the top and bottom lines, delivering adjusted earnings of 57 cents and revenue of $5.34 billion, well above consensus estimates of 51 cents and $5.01 billion.
Analysts said the breadth of moves underscored a market searching for clarity on AI-related investment cycles, cloud demand, and margins across sectors. In some cases, investors were rewarded for strong quarterlies, while others faced headwinds tied to guidance and the pace of spending. One analyst noted that while several results beat estimates, the market is scrutinizing how far earnings can lift when heavy capex commitments remain in play, particularly among platform and cloud players.
Key takeaways
- Price move: Meta Platforms fell about 9% in premarket trading after lifting its full-year capital expenditures guidance to a range of $125 billion to $145 billion, signaling sustained AI investment despite a negative market reaction.
- Catalyst: A wave of quarterly results from Lilly, Alphabet, Qualcomm, Amazon, Merck and others beat expectations or raised full-year guidance, while guidance or mixed signals from Meta and Stellantis weighed on risk sentiment.
- Implication: The session highlights a market still sensitive to AI expenditure intensity and cloud demand, with strong earnings virging against high capital outlays that could press margins in the near term.
What drove the move
The premarket mood reflected a blend of earnings strength and spend discipline. Lilly’s earnings and revenue beat, coupled with a raised annual sales outlook, underscored resilient demand for its portfolio, including cancer therapies. Alphabet’s revenue outperformance and cloud growth reinforced expectations that cloud incumbents can sustain growth even as AI-related capex remains a central theme for the sector. Qualcomm’s double-digit rally pointed to robust demand for chips tied to AI workloads, while a number of industrials posted solid top-line results that supported constructive sentiment around cyclical positions.
But the day’s gains were tempered by a handful of high-profile disappointments and cautious signals. Meta’s higher capex forecast raised questions about the near-term profitability implications of aggressive AI investments. Stellantis’ mixed backdrop and KLA’s softer guidance helped temper enthusiasm in parts of the market that had benefited from robust semiconductor and automotive exposures. Teladoc’s widening loss, despite a revenue beat, reminded investors that profitability remains a hurdle for some growth platforms as they scale.
Individual moves also conveyed a broader theme: investors are rewarding earnings beats and higher guidance, but remain wary of how fast and how much capital will be deployed in AI-centric initiatives. The size and duration of this spending cycle could determine how quickly margins can improve for platforms and cloud players, which in turn will influence subsequent guidance and stock performance for a broad swath of technology and industrial names.
Market reaction
Given the dispersion in results, the premarket picture shifted toward selective risk-on in names with strong earnings leverage or clear top-line strength, while stocks tied to heavy AI investments or ambiguous margin outlooks faced selling pressure. Alphabet’s strength and Qualcomm’s surge illustrated how investors are prioritizing near-term revenue visibility and AI-tailored product cycles. Meta’s retreat signaled investor concern that a high-capex regime can overshadow quarterly fundamentals in the near term, even as the company maintains a long-run AI investment thesis.
Across sectors, winners included Lilly, Alphabet, Amazon, Merck, Qualcomm and several consumer and industrial players delivering upside to estimates. Losers spanned Meta as its capex guidance overshadowed quarterly delivery, Teladoc on a widening loss, Stellantis on a mixed set of figures, and Teladoc’s peers in the healthcare and data-center ecosystems reacting to mixed signals about growth and profitability going forward.
What analysts are saying
Analysts highlighted the tug-of-war between earnings resilience and the cost of AI investments. While several companies delivered top- and bottom-line beats, the persistent focus on capital expenditure plans—particularly from Meta—drove caution about near-term margins. In some cases, like Stellantis, observers described the results as “messy,” with provisions and tariff-related complexities cited as complicating factors. For KLA, the guidance undershot some expectations, indicating ongoing scrutiny of equipment makers’ orders and pricing in a competitive semiconductor environment.
Overall, market participants appear to be parsing not only the current quarter results but also the trajectory of AI spending and cloud-driven revenue growth. The balance between capex intensity and margin expansion will likely shape how equities respond in the weeks ahead as investors weigh guidance against actual earnings momentum.
Bigger picture
The day’s activity sits at the intersection of earnings clarity and the AI investment cycle. Investors are weighing how much of the reported strength is durable versus the result of near-term demand surges and one-off factors. The earnings calendar in the coming weeks will be critical for confirming whether AI-driven capex can deliver sustainable revenue uplift and margin expansion across software, cloud, and hardware ecosystems. The macro backdrop—rates, inflation, and potential policy shifts—will also color how these companies sustain investment in AI and how their stock prices price in that risk and opportunity.
What to watch next: upcoming earnings releases, central-bank communications, and key data on inflation and employment that could influence interest-rate expectations. The next few sessions will be pivotal for gauging whether the AI spending cycle sustains momentum or enters a more cautious phase as companies assess profitability and capital efficiency amid a shifting macro environment.
