Tech giants post strong quarterly earnings

Apple and Amazon both posted earnings that topped analysts’ forecasts for the second quarter, yet investors reacted very differently to the two tech giants.

Apple’s strong revenue meets supply‑chain worries

Apple reported revenue of $109.4 billion, a 16 % rise from a year earlier. iPhone sales climbed 21.7 % to $54.25 billion, while Mac revenue grew 28.7 % to $10.35 billion. Net income rose to $29.79 billion, or $2.02 per share, up 29 % year‑over‑year. The company said earnings included a $0.11 per‑share benefit from tariff rebates.

Chief executive Tim Cook called the quarter “our strongest June quarter ever,” noting double‑digit growth in iPhone, Mac and Services across every region.

Apple’s stock slipped more than 6 % in after‑hours trading.

The decline followed guidance that warned of “significant constraints” in the supply chain. Cook said the firm is “evaluating all options” for alternative component suppliers, citing shortages of key chips that have already forced Apple to raise prices on Macs and iPads.

Apple expects revenue in the fiscal fourth quarter, which ends in September, to increase between 9 % and 11 %, short of the more than 12 % growth analysts had projected.

For many consumers, the supply‑chain bottleneck means longer waits for new iPhone models and higher prices for existing devices. The uncertainty around component availability could pressure Apple’s ability to maintain momentum in markets where competitors are expanding aggressively.

Amazon’s cloud surge lifts shares

Amazon reported net sales of $200.6 billion, a 20 % jump from the same period a year ago. Operating income rose 43 % to $27.5 billion. The company also announced a plan to increase 2026 capital spending to $220 billion, citing higher memory costs.

Amazon’s shares surged more than 10 % in extended trading, reflecting investor confidence in the company’s growth trajectory. Cloud services were a major driver, with Amazon Web Services (AWS) revenue up 37 % year‑over‑year to $42.4 billion. CEO Andy Jassy said AI and chips divisions each exceeded $25 billion in run‑rate revenue.

The market’s reaction suggests that investors are rewarding firms that can link heavy AI spending to clear revenue gains, a point noted by investment strategist Hugh Lam, who observed that Amazon’s results, along with those of Microsoft and Meta, show a change toward “selective” capital allocation.

Amazon’s robust cloud performance may also influence pricing for businesses that rely on AWS, as the company continues to expand its AI and chip offerings.