Feb 1, 2026

🛋️ MRKTcap

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🥳 Happy Sunday!

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In this newsletter we're diving into:

💰 Why two tech giants moved in completely opposite directions this week

💾 The earnings report that sent one stock up 14% in a single day

☕ The turnaround story that's finally showing proof

Plus, the supply shortage that's got one CEO scrambling for solutions.

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Make yourself comfy 🛋️ and let's get into it...

Market Crowd​
​How the market did this week.

*As of market close on Friday, January 30th.

Pre-Market Play​
​A market beat to start your week.
​

Win

Jay Rock

0:44 3:45

💸 AI spending splits the winners...

From the losers when earnings dropped.

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Meta Platforms (META) surged 8% while Microsoft (MSFT) tanked 11% on the same day over AI spending.

via GIPHY

Both companies crushed their earnings expectations.

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But Wall Street only rewarded one of them.

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Why?

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META showed the revenue to back up the spending.

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The social media giant posted 24% year-over-year revenue growth to $59.9 billion, fueled by online advertising.

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Then Zuckerberg dropped the news META plans to spend between $115 billion and $135 billion on AI this year which is nearly double what they spent in 2025.

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In past quarters, investors raised concerns over META’s spending plans.

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This time, the strong revenue growth and guidance for the current quarter ($53.5 billion to $56.5 billion versus $51.4 billion expected) eased those worries.

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MSFT told a different story.

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Azure cloud growth came in at 39%, which technically beat analyst estimates, but investors wanted more to justify a 66% jump in spending to $37.5 billion.

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CFO Amy Hood said Azure would have grown 40% if the company had allocated all of its new GPU chips to Azure instead of keeping some for in-house AI research.

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Analysts from Citi, JP Morgan, and Bernstein noted META’s “structural improvements” while questioning whether MSFT can better allocate resources to maximize Azure monetization.

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Despite this week’s drop, the way MSFT usually moves this time of year could provide a bounce up later this month.

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🥡 The Takeaway: Watch how other tech companies justify their AI spending when they report earnings over the next few weeks to see who gets the META treatment versus the MSFT punishment.

💾 Sandisk's AI memory jackpot...

Had the stock soaring after crushing earnings.

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Sandisk (SNDK) just dropped some seriously wild numbers that sent the stock up 14%.

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The flash storage memory company reported earnings of $6.20 per share, blowing past the $3.62 analysts expected.

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Revenue hit $3.03 billion when Wall Street was only expecting $2.69 billion.

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But here's where it gets spicy...

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Their Q3 guidance is more than double what analysts predicted.

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SNDK's calling for $4.4 to $4.8 billion in revenue when analysts were only expecting $2.93 billion.

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Raymond James, a financial services firm, upgraded the stock to outperform, saying supply's so tight it might be "sold out for years."

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The memory shortage driving AI datacenter buildout is creating serious pricing power for SNDK.

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Their datacenter business grew 64% sequentially, and gross margins are projected at 65-67% versus the 49.3% analysts expected.

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This is the same memory crunch hitting Apple (AAPL).

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Tim Cook said rising memory prices would impact the company and they're looking at "a range of options to deal with that."

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🥡 The Takeaway: SNDK's 14% pop came from guidance that's literally double expectations, creating a potential multi-quarter story as the memory shortage extends into 2027.

☕ Coffee comeback brewing...

And Niccol's recipe is finally showing results.

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Starbucks (SBUX) just pulled off something it hasn’t done in two years.

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Getting people back in stores.

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The coffee chain dropped Q1 results Wednesday that crushed expectations with revenue hitting $9.92 billion, blowing past the $9.67 billion Street expected.

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But the real story?

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Comparable transactions grew 3%, marking the first time in two years that more people are ordering their Starbucks again.

via GIPHY

Both rewards members (now at a record 35.5 million) and non-rewards customers who’ve been missing are coming back.

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CEO Brian Niccol’s retooled marketing and operational fixes are working.

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U.S. sales jumped 4% (3% from more customers, 1% from higher tickets), and China surprised with 7% same-store sales growth when Wall Street was only expecting 2.45%.

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Jim Cramer put it simply: “Brian Niccol has cracked the code.”

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The stock popped 3%+ to nearly $99, hitting $104.82 intraday (highest in almost a year).

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Now here’s the catch.

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Earnings per share missed at 56 cents versus 59 cents expected, and fiscal 2026 guidance came in light at $2.15-2.40 (midpoint $2.275 versus $2.35 consensus).

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That’s because Niccol is investing heavy in barista staffing and store remodels. Sales first, margins later.

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This news hits right on time for SBUX’s upcoming seasonal trend.

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🥡 The Takeaway: SBUX crushed the most important metric (first traffic growth in 2 years), and Thursday’s investor day revealed the margin improvement roadmap that has the stock holding near its highs.

💫 TMYK
​A quick pop quiz to help you learn about the market. The more you know!​
​

A stock’s __________ tells you how “big” the company is on the market.

a.) market capitalization

b.) volatility

c.) dividend

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Scroll down for the answer!

Gimme some mo'
​More news from 'round the market.
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💾 Corning’s fiber-optic jackpot ​
Corning (GLW) jumped 16% after landing a $6 billion deal with Meta (META) to supply fiber-optic cables for data centers through 2030 [Link]

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​✈️ Southwest bags bigger profits ​
Southwest Airlines (LUV) forecasts 2026 earnings of at least $4 per share, crushing Wall Street’s $3.19 estimate as new bag fees and seat assignments kick in [Link]

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🤖 Tesla drops $2B on xAI ​
Tesla (TSLA) invests $2 billion in Elon Musk’s xAI as part of the AI startup’s $20 billion funding round, raising questions about capital allocation [Link]

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📌 Pinterest cuts 15% for AI push ​
Pinterest (PINS) lays off less than 15% of its workforce to reallocate resources toward AI-focused teams and products [Link]

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💊 Eli Lilly’s pill gets Medicare boost ​
Eli Lilly (LLY) CEO says upcoming Medicare coverage for obesity drugs will launch alongside the company’s weight loss pill in Q2, potentially reaching 20-30 million beneficiaries [Link]

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​☁️ SAP cloud growth disappoints ​
SAP shares dropped 11%, the biggest drop since 2020, after fourth-quarter cloud contract growth came in at 16% versus the CEO’s 26% target [Link]

🤳🏾 Let me check my palm pilot
​Earnings events on deck this coming week.

Market Outlook
​A look at how the market does historically over the next week.

Data provided by Swingset.

Trend of the Week

Mastercard (MA) has a trend of going up over the next week.

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It's gone up 12 out of the last 15 years moving an average of 5.1% and projected to repeat this move Jan 30 - Feb 6.

💫 TMYK - Answer

A stock’s __________ tells you how “big” the company is on the market.

a.) market capitalization
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It’s share price times number of shares. Bigger number, bigger company (usually).

To wealth in every sense of the word, Tela Holcomb ​​​​

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This newsletter is by no means a solicitation to buy or sell any of the above-mentioned securities. It is for educational and entertainment purposes only. Any views expressed here do not necessarily reflect the views of any affiliate. Expressions of opinion are as of this date, are solely that of the writer and are subject to change without notice. All investments involve risk including the loss of principal and past performance does not guarantee future results. Always do your own research and due diligence. This newsletter may contain affiliate links and we may receive commissions, at no cost to you, for purchases made through links in this email. The MRKTcap team often invests in the same stocks that we cover.

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