Shares of AAPL are not getting the love they deserve, up only 1% on impressive December results and guidance. I would have expected them to be up 5% or more after the report. I believe the muted stock reaction is largely because investors want more clarity on when and how AI will impact the business. History suggests Cook will deliver the AI goods in the form of the first must have AI devices, likely starting mid to late this year. In the meantime, investors can sleep well at night knowing Apple’s customers remain loyal.

Meta’s December quarter results and guide provided the latest evidence that AI is materially accelerating the business at scale, boosting shares by 6% in after hours following a 5% move higher over the past week. The outlook for revenue growth was impressive, borderline hard to believe, calling for 33% growth at the high end of the range, an acceleration from 24% in the just reported December quarter. If they deliver on projections, revenue growth would be the highest since September of 2021, off a sales base that has about doubled over the past five years, pushing the law of large numbers to the side. Additionally, AI is improving engagement across the Family of Apps, up 7% y/y to 3.6B daily users. In September of 2024, DAU growth was 4.8%, representing faster growth off a bigger base. Lastly, Zuckerberg hinted that more products will come in the months ahead from Superintelligence Lab, which we believe will include a new foundational model.

Tesla’s quarter was met with shares up 2% in after hours, follwing shares being down 0.5% over the past week, suggesting investors were modestly impressed by the company’s progress in autonomy. I believe the stock action understates the progress the company is making in physical AI, and expect a breakthrough in FSD in the next one to two years, which should have a domino effect of accelerating progress in Robotaxi. My evidence of this progress includes recent personal observations of FSD, the company now reporting FSD subscriptions, and the company discontinuing Model S and X, about 2% of sales, in favor of using production lines to ramp Cybercab.

Tesla will report December earnings on Wednesday, January 28th. Since reporting deliveries on January 2nd, shares of TSLA are up 1%, in line with the Nasdaq. The three most important topics on the call are the timing of expanding safety-driver-free Robotaxi service to new cities, high-level commentary on deliveries in 2026, the first full year without the tax credit, and margin expectations this year, including the impact of the lower-priced Model 3 and Model Y. While FSD, Optimus, and timing of Cybercab ramp are top of mind, there is likely little new Elon will say to change how investors are gauging the success of those segments. In the end, I expect shares to move higher throughout the year as investors gain confidence that Tesla remains best positioned to capitalize on physical AI.

Over the past three months, shares of GOOG are up 31% vs the Nasdaq up 4%, as Google’s technical chops in AI have been validated. Strengthening AI products have translated into higher Street expectations for Search growth in December, increasing from 12% two months ago to 14%. I believe the segment will end the quarter up 15% based on our survey of sponsored ads within AI Overviews and AI Mode. That upside should flow into CY26, and provide further upside.

Nvidia gave three incremental updates at CES that pointed to upside this year. The first was Jensen’s comments in the keynote twice describing demand as “skyrocketing.” The second was CFO Colette Kress saying at the JPMorgan fireside that their previous target calling for a $500B data center revenue outlook through 2026 has “definitely gotten larger.” The third was Jensen’s comment that demand for the relaunch of the H20 in China was “quite high.” Shares of NVDA shrugged off the good news, trading down 4% in the three days following the updates, compared to the Nasdaq which was flat, underscoring investor concern that it's a function of time before growth stalls. I believe growth will be higher for longer, driven near term by the hyperscalers and long term by Physical AI.

Tesla delivered 418k vehicles versus Street expectations of 420k and above the whisper number of 415k. Overall, deliveries were down 16% year over year in December, compared with up 7% in September. Cutting through the noise around the timing of the tax credit expiration, I believe deliveries would have been down ~5% in both September and December signaling stabilization that should allow investors to remain focused on autonomy. Additionally, I believe these results indicate the first U.S. EV market share gains in a couple of years.