A weak jobs report with a side of hot tech earnings and fresh tariffs.
The US economy created 73,000 jobs in July, falling short of estimates for 100,000. And there were large downward revisions to May and June jobs numbers! The unemployment rate held steady at 4.2%.
Investors are likely to wonder if the Trump administration’s tariff policy — including new levies on goods from Canada and other top trading partners today — is beginning to weigh on hiring plans and the economy.
Queue those Trump rate-cut posts on Truth Social.
The economic read comes on the heels of strong earnings from Apple (AAPL) and Amazon (AMZN) last night. The duo capped an impressive earnings week for large caps, with Meta (META) and Microsoft (MSFT) being the other standouts. Even second-tier Big Tech names in Roblox (RBLX) have crushed expectations (watch CEO Dave Baszucki’s interview above).
Most importantly, Amazon, Apple, Alphabet (GOOG, GOOGL), Microsoft, and Meta all put to bed one fear: Lofty valuations supported by hopes for AI-driven growth may not be lofty enough.
Not only did Amazon, Apple, Meta, and Microsoft show strong growth throughout their giant businesses, but execs also conveyed that AI is unlocking new avenues of growth for the quarter to come. Their bottom lines also easily eclipsed Wall Street forecasts.
Reports were generally embraced (save for Amazon, where investors opted to lock in on an OK outlook rather than a blowout outlook).
“As the main engine of US equity profitability for the last few years, 2Q25 results from Alphabet, Meta and Microsoft suggest that growth momentum is intact,” Barclays strategist Venu Krishna said.
It’s a point well taken.
Apple’s services growth tallied 13% last quarter and is expected to increase at a similar pace in the current quarter. Quarterly iPhone sales increased 13% from the prior year and improved in every geographic market.
The company had the saddest story to tell on the AI front, but CEO Tim Cook still did enough on the earnings call to temporarily ratchet down worries that Apple will be a nonentity in AI. The company has spent $15.5 billion in capital expenditures in the first half of the year, up from $11 billion a year ago — underscoring its AI investment roadmap.
AI rollouts by big companies continue to feed Amazon’s lucrative AWS cloud business. Second quarter sales for AWS rose 17.5% from last year, accelerating from a 16.9% growth rate in the first quarter. Amazon CEO Andy Jassy said on the earnings call that demand for AWS is outstripping supply.
