Stocks rose on Friday as strong gains from tech giant Amazon (AMZN ) helped uplift the broader market as artificial intelligence trading continued to dominate investor moves.
Amazon (AMZN ) shares jumped over 10% on Friday after the e-commerce platform posted third-quarter earnings that topped Wall Street estimates on top and bottom lines. Chief Executive Officer Andy Jassy said during the company's earnings call that Amazon Web Service is "growing at a pace we haven't seen since 2022" and that AI and core infrastructure demand is "strong."
The company's cloud unit's revenue rose 20% during the quarter to $33 billion, generating operating income of $11.4 billion -- about two-thirds of Amazon's total operating profit. That growth led to Amazon joining its tech peers Alphabet (GOOG ) (GOOGL ), Meta Platforms (META ) and Microsoft (MSFT ) by increasing its full year capital expenditures outlook to $125 billion from its prior forecast of $118 billion.
Netflix (NFLX ) also supported broader market gains on Friday after the streaming giant announce a 10-for 1 stock split. The company is also rumored to be in early talks to offer to buy Warner Bros. Discovery (WBD ), according to Reuters, which reported Friday that Netflix hired the investment bank Moelis & Co., who advised Paramount Global's (PSKY ) successful Skydance Media bid.
Elsewhere on the earnings front, Apple (AAPL ) reported better-than-expected fiscal fourth-quarter earnings late Thursday and issued a positive forecast for its current quarter. Overall iPhone revenue rose 6% to $49.03 billion, demonstrating early demand for its new line of smartphones which launched on Sept. 19.
"We expect total company revenue to grow by 10 to 12% year over year, we expect iPhone revenue to grow double digits, year over year, and we expect that that would make the December quarter the best ever in the history of the company," CEO Tim Cook told CNBC.
Coinbase (COIN ) shares also climbed higher after the trading platform delivered strong earnings as retail and institutional crypto investments traded more frequently throughout the quarter. Transaction revenue rose 37% quarter-to-quarter to $1 billion, with retail investing bringing in $844 million (up 30% over Q2) and institutional trading generating $135 million (up 122% over Q2).
"The 'everything exchange' is really central to the next chapter of what we're building," CEO Brian Armstrong said during the company's earnings call. "Now we've been heads down working on the next pieces of that, because we think that every asset class is going to come on chain, and our customers are asking for this," adding that the company increased the number of tradable assets on its platform to 40,000 from 300 in the third quarter.
Looking ahead, UBS Global Head of Equities Ulrike Hoffmann-Burchardi wrote in a Friday note to clients that the recent trade truce between President Donald Trump and Chinese President Xi Jinping could provide some tailwinds for global equities.
"While no formal deal was signed, a modestly positive outcome on this U.S.-China risk catalyst may be sufficient for global markets, adding to a positive backdrop for stock rallies in the US and China that have been underpinned by strong AI demand and innovation," Hoffmann-Burchardi wrote.
