- Alphabet and Tesla have both disappointed Wall Street with massive spending increases that offset better performance for the quarter.
- In Europe, Italian banking giant Unicredit topped quarterly forecasts, as the CEO told CNBC exclusively that he is happy with the progress on Commerzbank.
- Crude prices are sharply higher as President Donald Trump threatens Iranian infrastructure strikes.
- Coming up later today: The European Central Bank holds its policy meeting.
Jakub Porzycki | Nurphoto | Getty Images
Hello, this is Leonie Kidd coming to you from London
Brace yourself Big Tech
This quarter, it’s clear that companies are going to be judged on their spending habits. Alphabet and Tesla have found out the hard way, with investors sending the stocks lower despite solid results
Meta, Microsoft, Amazon and Apple are all scheduled to release results over the coming days, with funding the AI boom now a key metric when assessing the balance sheet
What you need to know today
Alphabet and Tesla are testing Wall Street’s patience and appetite for mega AI pending plans
Shares in the two heavyweights sank on Wednesday after their capex and spending plans spooked investors, despite a solid set of earnings for the quarter
For Google parent Alphabet, better-than-expected revenues were overshadowed by an expected capex spend of up to $205 billion for 2026
“The increase in the range is primarily due to an acceleration in the delivery of capacity to meet growing demand,” Chief Financial Officer Anat Ashkenazi told analysts
Meanwhile, Tesla is concerning investors with skyrocketing costs. Free cash flow turned negative as Elon Musk looked to pivot the company beyond vehicle sales into driverless robotaxis and humanoid robots
Once again, a beat on quarterly revenue expectations was clouded by a 142% increase in capital expenditure. The company has previously said it could top $25 billion this year
Over the coming days, we will get more details on spending plans from across the tech space, with results from Meta, Microsoft, Amazon and Apple all due over the next two weeks
Banking on M&A
In Europe, Italian banking giant Unicredit has topped forecasts with a net profit of 2.9 billion euros ($3.3 billion) for the second quarter. Speaking exclusively to CNBC, CEO Andrea Orcel said the bank has reached “the best outcome it could hope for” in its acquisition of Commerzbank shares, saying a final agreement will be in the best interests of both banks
Iranian infrastructure threat
Crude prices were driving higher in early trade on Thursday. Several developments are keeping oil elevated, including renewed threats by U.S. President Donald Trump to strike key Iranian infrastructure
Another attack on a tanker off the coast of Saudi Arabia also kept tensions high. U.S. Central Command confirmed the 12th night of strikes in retaliation for the targeting of ships had taken place
In a note published early Thursday, Goldman Sachs said “Brent might exceed $120/bbl in the fourth quarter, and average $100 in 2027” if the disruptions to the Strait of Hormuz continue
Hold the look
The European Central Bank is expected to hold rates steady at 2.25%. Policymakers will meet later today, as renewed hostilities in Iran have prompted a rethink of the interest rates path amid an “extremely volatile” outlook
You can watch our coverage on Decision Time: ECB from 13:00 BST / 08:00 ET, live streaming here
And Finally
What is Pickaxe Mountain, the Iranian nuclear facility Trump is threatening to strike?
President Donald Trump has threatened to bomb the Iranian underground nuclear facility Pickaxe Mountain, ratcheting up tensions between the U.S. and Iran
The president’s comments have put renewed focus on one of Iran’s most secure and protected facilities
Following Trump’s earlier comments in early July, David Albright, a nuclear weapons expert and founder of the U.S.-based non-profit Institute for Science and International Security, said the mountain is large enough to hold a centrifuge enrichment plant as well as nuclear weaponization activities
— Sawdah Bhaimiya
