Here's a takeaway from today's Morning Brief that you can take away. Sign up To receive in your inbox every morning with:
Investors were treated to two different versions of artificial intelligence this week. And both sound great.
Microsoft ( MSFT ) announced a partnership with Coca-Cola ( KO ) for the soft drink king to “co-experiment” with a new Azure AI-based version of Microsoft's cloud-based suite of productivity software. will pay $1.1 billion for
And after Microsoft's quarterly results showed AI increasingly driven by the growth of its cloud business and an enthusiastic leadership team, the stock rose 2% on Friday.
Alphabet ( GOOG , GOOGL ) had a similar story, but with a stronger investor response — up 10% on Friday — as investors reconsidered the company's second position to Microsoft. Now, YouTube, search and cloud businesses seem ready for their own AI-ification.
On the other side of the table was Tesla's ( TSLA ) earnings presentation. Elon Musk said the company doubled down on its end game for fully autonomous vehicles, a robotaxi fleet, licensing self-driving tech to other automakers — they're in talks, and Teslas standing to create some. Ability to harness AI computing power. Similar to Amazon's AWS, a bold but old idea that has been around since the 1980s.
These are two completely different visions of the AI future. “Productivity software” certainly doesn't have the same ring to it as “robotaxy,” which is Peter Thiel's “we wanted flying cars, instead we got 140 characters” spectrum we talked about two weeks ago.
But as our weekly chart shows, investors liked them both.
And they should. Tesla's rise was partly about defying some reasonable investor concerns — cutting costs to deal with lagging demand and confirming that affordable EVs are on the way. But the biggest story was the self-driving AI vision from Grand Visionary.
It's rare, and that's why some people love Elon. For the most part, the path to AI first leads through the tedious corporate world of programmatic advertising and productivity tools, which are the core businesses of today's big AI software/cloud players – Google, Microsoft and Meta.
On the other hand, Tesla's fantastical self-driving future of consumer cars and robotics “change the world” Big Tech's expectation (actually) is more in line with the “better Office 365” reality we often see.
But this is more of an extraordinary improvement than anything else. It's important to remember the lesson that any regional American city will teach you: Many of America's wealthy have simply taken on the less glamorous businesses of fast food franchising, agricultural processing, waste management, car dealerships, commercial real estate, and more. took the path. Mention all the other B2B things you'd never think twice about. For every Zuckerberg, there are thousands of Buddy Garrities.
However, Zuckerberg may have taken the world too far in Meta's earnings call on Wednesday, as our Hamza Shaaban put it, making AI's ambitions “seem small.” The company talked about “scaling business messaging,” “better ad insertion” and selling AI computing power.
And as we wrote in March, breaking down productivity barriers is huge for the economy. But you still have to sell them. After all, they are still “productivity gains”, not flying cars.
Ethan Wolfe Mann There is a senior editor at Yahoo Finance, who runs the newsletter. Follow him on Twitter. @ewolffmann.
For the latest earnings reports and analysis, earnings whispers and expectations, and company earnings news, click here
Read the latest financial and business news from Yahoo Finance