NEWS
AI Plays Have Had Better Days

A continued cooling of labor market data made for a mixed day on Wall Street, as investors struggle to determine if ‘bad’ news for the economy is good news for stocks. Despite the market weakness, defensive sectors slumped and Tesla became the latest AI play. 👀

Today's issue covers Broadcom breaking down after a double-beat, traders eying Tesla’s technical breakout, an auto parts giant preparing to accelerate, and why Trump-linked stocks aren’t having any $PHUN. 📰

Here’s the S&P 500 heatmap. 2 of 11 sectors closed green, with consumer discretionary (+1.13%) leading and healthcare (-1.37%) lagging.

And here are the closing prices: 

Most bullish/bearish symbols on Stocktwits at the close: 📈 $ZUMZ, $VOR, $TVTX, $BRZE, $ABUS 📉 $MCK, $SWBI, $GOSS, $MBLY, $NWBO*

*If you’re a business and want to access this data via our API, email us.

EARNINGS
Broadcom Is The Latest AI Bust 👎

Semiconductor giant Broadcom sank 7% despite delivering earnings and revenue beats. Like many of its peers, the stock came into its report hot, and expectations proved a bit too high for the company to match. 😬

Adjusted earnings per share of $1.24 on revenues of $13.07 billion topped the expected $1.20 and $12.97 billion. Its semiconductor solutions segment saw $7.30 billion in revenue, while infrastructure software generated $5.80 billion.

CEO Hock Tan emphasized the company’s role in the artificial intelligence (AI) boom, saying he now expects a record $12 billion in revenue from AI parts and custom chips during fiscal 2024, up from a previous forecast of $11 billion. 🦾

Still, investors are trying to figure out how to value the company, which remains far more diversified to categories like networking, broadband, server storage, wireless, and industrials than competitors seen as ‘pure AI’ plays.

Shares had risen over 75% over the last year in hopes that it would become a major player in the space. And although it has, its guidance simply meeting analyst expectations was not enough to keep investors excited in the near term, especially in an environment where even Nvidia is under pressure... 😐

Traders and investors will be watching closely to see how the stock digests this news in the coming days and weeks. Currently, the after-hours price action is at odds with Stocktwits community sentiment, which remains in ‘extremely bullish’ territory. 🧐

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