Wedbush weighs in ahead of Meta, Tesla, and Microsoft earnings, focus on capex

Investing.com -- Tech giants Microsoft (NASDAQ: MSFT), Meta (NASDAQ: META), and Tesla (NASDAQ: TSLA) are set to report their earnings after the bell, with investors closely watching AI-related capital expenditures.

“Making this night even bigger was the DeepSeek LLM AI model heard around the world over the last few days which will put even more of a spotlight focus on Zuckerberg and Nadella's Cap-Ex comments tonight,” analyst at Wedbush said.

Despite recent concerns over the costs of AI development, the brokerage expects Microsoft and Meta to reaffirm their aggressive spending plans, with Meta likely doubling down on its 2025 capex target of $60 billion-$65 billion and Microsoft reiterating its $80 billion investment.

Wedbush expects Microsoft’s AI revenue to surpass a $10 billion annual run rate this quarter, reinforcing the firm’s view of 2025 as the inflection year for enterprise AI adoption.

The brokerage also remains bullish on Tesla, forecasting a potential $2 trillion market cap by the end of 2025 as its autonomous strategy gains traction and Chinese demand strengthens.

While some bears question Big Tech’s AI spending after Chinese startup DeepSeek claimed to have built a competitive model for just $6 million, Wedbush shrugged this off as flawed logic, arguing that AI’s future hinges on vast infrastructure, proprietary data, and Nvidia’s next-gen chips.

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