Apple Falls 7% on Supply Woes, Amazon Jumps 12% on AWS Growth

Investors are separating winners from laggards in the AI buildout after two major technology companies reported sharply different quarterly results. Amazon shares rose 12 percent in premarket trading while Apple shares fell 7 percent, reflecting distinct assessments of each firm’s ability to convert heavy spending into revenue.

Amazon reported AWS revenue growth of 37 percent year over year for the June quarter, the strongest pace since 2021, according to the company. The cloud unit’s performance came even as Amazon raised its full-year capital-expenditure forecast to $220 billion from $200 billion. Analysts at Forrester noted that the growth indicated infrastructure investments were aligned with demand rather than ahead of it. Apple, by contrast, beat expectations on earnings, revenue and iPhone sales yet guided to 9-11 percent revenue growth for the current quarter, below the 12 percent consensus compiled by LSEG. The company cited supply constraints on memory components and competition for chip capacity.

The divergence follows similar patterns earlier in the earnings season. Microsoft rose sharply after its results while Meta fell, showing that investors are applying different standards to AI-related spending plans. Newsmax reported that Amazon’s results helped ease concerns about returns on AI investment that had contributed to July volatility. CNBC noted that Apple’s guidance shortfall prompted expectations of higher iPhone prices later this year.

Futures on the Nasdaq rose 1.21 percent, the S&P 500 added 0.48 percent and the Dow gained 0.67 percent as of 7:04 a.m. Eastern time, according to Newsmax. Microsoft shares slipped 0.8 percent, Alphabet rose 2.3 percent and Nvidia gained 1.5 percent. The Philadelphia Semiconductor Index remained on track for its largest monthly decline since 2008.

Analyst John Plassard of Cité Gestion told Newsmax that companies must now demonstrate future growth drivers beyond beating estimates. Laurent Clavel of AXA Investment Managers said investors were “re-buying this AI narrative” after the recent selloff. The Federal Reserve’s decision to hold rates steady added another layer of uncertainty, with markets pricing in a 36.8 percent chance of no change in September.

GoDaddy shares dropped 12.4 percent after the company narrowed its annual revenue forecast. All three major indexes are still positioned for weekly gains but monthly losses.