Sandisk jumped more than 15% after Investor Day unveiled targets through fiscal 2030, with projected revenue rising in the mid-to-high teens from 2028–2030, adjusted gross margins around 80% and adjusted operating margins near 75%. Management aims for about 50% adjusted free cash flow margin, keeps operating expenses around 5% of revenue, and plans to return excess cash to shareholders, leveraging its NAND flash business and long-term customer relationships amid questions about sustaining memory demand.
Sandisk shares rose for a fourth straight day after Evercore ISI laid out a bullish forecast: NAND prices have surged, Sandisk could sustain roughly 80% gross margins through the cycle and generate as much as $35 billion in annual free cash flow, enabling aggressive buybacks (potentially 10% of shares annually starting in 2027 and more by 2029), with analysts projecting more than $100 billion in free cash flow through 2029.
Diageo’s 2026 preliminary results for the year ended 30 June show net sales of $19.643 billion, down 3% on a reported basis and 2% organically. Organic net sales fell 2% with volume down 0.4% and a 1.6% adverse price/mix, though growth occurred in Europe, Latin America and Africa while North America and Asia Pacific weakened. Organic operating profit rose 2% with margins up 116 basis points thanks to cost savings, but the reported figure declined 27.2% due to restructuring costs and impairment charges; EPS before exceptional items was 165.3 cents. Free cash flow rose to $3.211 billion, and net debt stood at $20.5 billion. The company is progressing with disposals (East Africa Breweries) and a planned sale of the RCB cricket team, maintaining a 50 cents per share dividend. A two-year restructuring program is underway, with $0.9 billion of charges in fiscal 2026 and expected $850 million in savings from fiscal 2027, plus $1.5 billion of impairments largely from Türkiye. CEO Dave Lewis says progress in several regions supports the turnaround as the Capital Markets Day is underway.
Memory-chipmakers are boosting shareholder returns as AI-driven demand keeps cash flowing: SanDisk adds $14 billion to its buyback authorization (now $15.5 billion total), Western Digital is expanding its $4 billion buyback, and Micron is expected to announce a large program once CHIPS Act limits lift in December. At the same time, both Micron and SanDisk are expanding memory capacity in the US and Asia to meet rising AI demand. Despite recent stock declines in memory names, executives frame the cash flow and buybacks as durable signs of value as the memory market remains strong and capacity grows.
AppLovin reported Q2 revenue of $1.92B (up 53% YoY) but missed the $1.94B consensus, while EPS was $3.76 and net income rose 55% to $1.27B. Free cash flow hit $863M and EBITDA margin was 84%, with the Rule of 40 at 98. Management guided Q3 revenue to about $2.06-2.09B and about $551M in buybacks, but the stock fell roughly 17% in premarket trading.
Goldman Sachs says the rally is broadening as Big Tech’s free cash flow comes under pressure from AI-related capex, fueling a rotation into a wider set of stocks and helping the equally weighted S&P outperform the cap-weighted index. With Meta and Alphabet guiding higher capex and a resilient economy boosting M&A, broad participation could persist even as cash flow remains subdued in tech.
Tech stock investors face a looming $1 trillion problem as hyperscalers accelerate AI-driven capex, with 2027 spending projected to top $1 trillion and capex set to outpace cash flow from operations from 2026 through 2028; Meta has raised its 2026 capex guidance and Alphabet signaled higher 2027 spend, while Microsoft remains the only major player with a favorable near-term free cash flow outlook.
Meta Platforms plans a massive AI-infrastructure push, guiding up to $145 billion in capex for 2026 and aiming to monetize excess compute by selling capacity to third parties. The move coincides with a Q2 2026 showing rising costs (R&D up ~68%) and a -8% drop in operating income, while free cash flow plunges to about $784 million and the balance sheet weakens with higher debt and shrinking cash. No share buybacks occurred in the first half of 2026. Investors will judge the AI investment on the returns it delivers, especially if free cash flow remains negative in 2026–27.
Meta Platforms is aggressively expanding its AI infrastructure even as trailing free cash flow declines and capex remains very high. The company’s Meta Compute initiative includes large-scale data-center investments, such as a 1-gigawatt project with BlackRock to train models and power advertising and new products. With Q2 capex around $30 billion and full-year guidance of $130–$145 billion, Meta argues the AI demand wave underbuilt by the industry justifies the investment and could be monetized via its ad engine or third-party demand. Meanwhile, core ad revenue grew and engagement improved, offering early signs that AI spend could pay off, but investors should monitor whether the ROI from this spend translates into sustained cash flow and profits as the cycle unfolds.
Earnings show Amazon, Alphabet, and Microsoft turning AI infrastructure into revenue, with combined cloud backlog rising from about $800 billion to over $2.3 trillion in signed commitments. Capacity constraints kept GPU prices rising (Nvidia H100 rentals up ~63%), while Oracle trails on debt. The trio funds expansion with massive free cash flow, suggesting durable profits from AI—not just hype—making them potentially safer, long‑term AI investments.
Meta Platforms reported Q2 revenue of $61 billion (up 28% year over year) while net income declined 14% to $6 billion. The company raised its 2026 capital expenditure forecast to $130–$145 billion to scale AI infrastructure, models, data centers, and AI-powered products, signaling expectations of future returns from AI tools and APIs. However, free cash flow fell to $784 million—the lowest in about five years—due to higher infrastructure costs, prompting investor concern about the pace and timeline of AI-driven gains as the stock traded lower.
Meta Platforms posted a quarterly profit of $15.85 billion on revenue of $60.8 billion, down 14% from a year earlier, as legal bills and severance costs weigh on results. Free cash flow plunged 91% to $784 million due to $2.4 billion in legal expenses and layoffs, even as Zuckerberg champions AI and the company forecasts $61–64 billion in Q3 revenue. Meta’s headcount stood around 75,472 after layoffs, and the stock fell in after-hours trading following the results.
Stellantis swung to a €293 million Q2 profit as rising North American demand boosted adjusted operating income to €773 million, though results missed Reuters’ consensus. The automaker posted €1.0 billion in industrial free cash flow and reaffirmed progress on the FaSTLAne 2030 plan with new product launches on track, while shares fell on the news.
Meta logged a 91% plunge in second-quarter free cash flow to $784 million as AI investment accelerates, while revenue rose 28% to $60.8 billion, prompting a 10% after-hours stock drop. The company also raised 2026 capex guidance to $130–$145 billion amid plans to expand data centers, and faces ongoing legal scrutiny over youth-safety issues that could impact results.
Meta Platforms' stock fell after Q2 results missed on EPS ($6.18 vs $7.22 est) and revenue, with guidance for the next quarter coming in light ($61–$64B, midpoint $62.5B). The company narrowed full-year capex to $130–$145B, but aggressive AI infrastructure spending drove free cash flow down to $784 million from $8.55 billion a year earlier. Net income declined to $15.85 billion, and Reality Labs posted a large operating loss. Meta is continuing to push AI initiatives and data-center expansion, including deals like a $14 billion BlackRock data-center venture and other planned centers, as it seeks to monetize AI and scale compute capacity.
