The discussion argues that AI has pushed Big Tech toward a business model closer to utilities, so investors may price the sector accordingly. Although earnings were not poor, they were not enough to support the market, as investors now ask who will profit, what margins look like, and when the promise of AI will be fulfilled. A widely shared X post argues that AI requires heavy upfront spending, long payback periods and profits tied to keeping infrastructure running, so the economic moat has shifted from code to cash. The speakers see utilities as cash generators rather than growth stocks and suggest Big Tech may become a hybrid, but Barron's Al Root called the view a familiar argument that AI monetization may not justify the spending.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on Yahoo Finance ↗
Keywords
valuationtech stocksartificial intelligence
Open a keyword to see other news on the same topic.
Related tickers and likely impact
AMZN
▼ Likely negativeAmazon
Relevance: low
| Market | US stocks |
|---|---|
| Sector | Consumer Discretionary |
| Industry | Broadline Retail |
| Market cap | $2.6T |
| Close on 10/30/2026 | 240.47 |
| Change that session | -1.36% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
Related news
- HP (HPQ) Could Be 5% Above Fair Value Following Its AI Workstation News
HP drew attention in AI news after Infinity.inc used its Auto Research tools to tune NVIDIA's Nemotron 3 Super on HP's ZGX Fury workstation, doubling concurrent workloads without changing the underlying GB300 hardware. The share price fell 9.6% over one day and 14.5% over the past week, though it still shows a 30.1% year-to-date gain and a 9.3% one-year total shareholder return. Last closing at $28.78, the stock sits above the most-followed fair value estimate of $27.31, which the article describes as about 5% overvalued. On an earnings-multiple basis, HP trades at a P/E of 10.6x versus 17.7x for the global tech industry and a fair ratio of 25.5x.
- 5 Best High Growth Stocks Outside Big Tech
Market growth is unusually concentrated in a few mega-cap tech stocks, with ten AI-related names making up over 40% of the S&P 500's market capitalization. The article argues non-tech growth stocks merit a look, but growth must be weighed against margins, debt, customer concentration and capital intensity. Analysts expect the "Magnificent Seven" to grow third-quarter earnings 20.3% year over year, versus 27.7% for the other 493 S&P 500 companies, suggesting earnings momentum is broadening. Netskope is cited as an example: revenue rose 29.2% to $220.5 million, yet trailing EBITDA stayed negative at $721 million. The list screens non-tech stocks with market caps above $20 billion and at least 25% five-year EPS growth.
- Is Adobe the Ultimate Buy-on-the-Dip Stock?
The article argues Adobe faces the risk of being replaced by AI-generated images, though the company is adding AI tools to its software. Its subscription revenue has kept growing at a slow but steady pace, with little change from the 2022 growth rate, while the stock is down about 60% from its late 2021 peak. Adobe now trades at 11 times forward earnings, a level that reflects market skepticism. The author doubts Adobe can achieve 20% to 30% growth or regain its valuation, and even a rise to 20 times forward earnings would amount to a single doubling followed by market-average growth. Although the author thinks the outlook is not as bad as the market believes, investors do not need to hold Adobe stock when many solid AI stocks are available.
- China's tech darlings are losing their shine. Here's what's behind the sell-off
China's technology stocks are losing momentum as investors question whether the AI boom can generate profits high enough to justify rich valuations. The STAR 50 Index, which tracks 50 of the largest and most liquid companies on Shanghai's STAR Market, has fallen more than 40% from its July peak. The sell-off began as profit-taking after a strong rally that accelerated when DeepSeek emerged in early 2025, but has widened into doubts about whether earnings can support current prices. Battery giant CATL, down 37% year to date, illustrates the problem: its third-quarter revenue rose roughly 59% but net profit only about 15%, as competition, product mix and changes to taxes and rebates squeezed profitability. Analysts say a sustained rebound would require stabilizing earnings, clearer returns on AI spending and stronger domestic demand.
- Nvidia (NVDA) Stock Still Looks Reasonable Following Its 7x Five Year Run
Nvidia has gained about 7x over the past five years, and a recent pullback has not erased most of those gains. The article questions whether the company's cash flows can still support its current share price. Its discounted cash flow (DCF) model, based on last-twelve-month free cash flow of about $126.7b, puts intrinsic value substantially above the $210.96 share price. The price stays below that value largely due to concerns over the durability of AI-driven cash flows, including risks from highly indebted AI infrastructure customers such as CoreWeave. The article also cites a P/E of 26.4x.
- Apple's new hardware push is meeting AI-worried investors at the right moment
Apple is pushing its hardware lineup to reclaim the title of the most valuable company on the stock market, briefly succeeding on Friday. The campaign, led by new CEO John Ternus, marks a shift from predecessor Tim Cook's services-first strategy and comes as the AI trade loses steam. Investor concerns over AI financing were renewed this week by Meta's off-balance-sheet spending plans of $825 billion and Tesla's estimated $100 billion chip plant, while SK Hynix paused a spin-off IPO and the 10-year Treasury yield pushed back under 5%. The new iPhone Duo launched Friday.
Related markets
Latest news
- Beta Technologies Beat Archer and Joby to an FAA First. Here's Why I'd Still Rather Own Archer.
Beta Technologies became the first eVTOL developer to secure FAA authorization for demonstration flights with potential customers on board, receiving an airworthiness certificate for market surveys on Oct. 21. The certificate does not allow carrying fare-paying passengers, and Beta focuses on cargo and medical supply transport while building a charging network. The author still prefers Archer Aviation because Archer plans both to manufacture aircraft and run its own air taxi service, while Beta mainly aims to sell aircraft, batteries, charging equipment and propulsion systems. He cites a 2021 Morgan Stanley estimate that eVTOL passenger transport could reach a $3.7 trillion market by 2050. He says both companies could succeed in the industry.
- Morning Minute: Binance Hack Leads to Mass Outflows While FBI Opens Probe
Binance suffered a hack that drained roughly $6.4 billion from hot wallets across about 10 blockchains, an attack attributed to the North Korea-linked group TraderTraitor. After reopening withdrawals, Binance has seen $3.64 billion in net outflows, according to QCP. Bitcoin ETFs saw $643 million in outflows on Friday, flipping October to -$515.9 million, while ETH ETFs posted -$1.61 billion for the month. Binance says it has set aside more than $6.34 billion to cover losses, and the FBI and Secret Service have opened probes. CFTC Chairman Michael Selig said the hack 'proves our exact point' about unregulated offshore exchanges.
- Morning Minute: Binance Hack Leads to Mass Outflows While FBI Opens Probe
Binance suffered a hack that drained roughly $6.4 billion from hot wallets across about 10 blockchains, an attack attributed to the North Korea-linked group TraderTraitor. After reopening withdrawals, Binance has seen $3.64 billion in net outflows, according to QCP. Bitcoin ETFs saw $643 million in outflows on Friday, flipping October to -$515.9 million, while ETH ETFs posted -$1.61 billion for the month. Binance says it has set aside more than $6.34 billion to cover losses, and the FBI and Secret Service have opened probes. CFTC Chairman Michael Selig said the hack 'proves our exact point' about unregulated offshore exchanges.
- Lumen and Microsoft Expand Collaboration to Co-Sell Enterprise AI-Ready Networks
Lumen Technologies and Microsoft are expanding their co-selling partnership to help enterprises connect the data, applications and infrastructure behind AI, which are often fragmented across clouds, data centers and offices. Lumen plans to bring its full suite of cloud networking and application connectivity capabilities to Azure, and the companies will engage in joint account planning for opportunities where network modernization, Azure migration and AI transformation converge. Alkira, a Lumen Connect solution, is already available through Microsoft Marketplace. The companies will share more details as their joint go-to-market plans progress.
- AI agent disputes head to 'Internet Court' — and a jury of AI agents
GenLayer, an open delegated proof-of-stake network of validators connected to AI models, currently processes around 12,000 decisions per day in beta, with mainnet expected next month. Internet Court is a protocol that lets agents and humans sign contracts, with funds held in escrow until the terms are judged to have been met. A dispute is first judged by a randomly selected jury of five validators, each running a different AI model, and can be appealed to juries of 11, 23 and more, with finality typically within 30 minutes. The team argues that using many AI models rather than one reduces the bias of any single system, and the court's consortium has 35 members including ZKsync, NEAR, Consensys and UMA. GenLayer is used by Collective Memory to assess user-uploaded photos and by Argue.fun to resolve arguments.
- The Biggest Crypto Hack in History Just Happened. Here's What the $6.3 Billion Breach Means for the Crypto Market.
Binance said on Oct. 29 that hackers had stolen about $6.3 billion, which the article describes as the biggest crypto hack in history. After the announcement, Bitcoin fell 5.6% within 24 hours and BNB dropped 6.2%. Binance had a rainy-day fund worth around $1 billion and has set aside more than $6.3 billion of its own capital to restore affected customer balances, so direct losses appear covered. Tether froze more than $1.5 billion of USDT and Circle froze $800 million of USDC tied to the theft, and the article says the major blockchains themselves were not breached. More than $3.3 billion was lost to hacks and scams in 2025, and more than $8.7 billion has been lost in 2026 so far.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.