Jim Cramer of CNBC stated on Wednesday that a handful of tech giants have become so powerful that their influence far exceeds their stock prices alone.
The host of “Mad Money” compared them to “nations,” on the grounds that these companies possess a dominant competitive position, the ability to generate substantial profits, and a willingness to actively invest in emerging technologies. Kramer specifically mentioned Alphabet, Amazon, Apple, Meta Platforms, Microsoft, NVIDIA, Tesla, SpaceX, Anthropic, and OpenAI, stating that these companies all fit this description.
Their size is so astonishing that Mad Money cannot help but report on them, he said.
Cramer’s charitable trust fund is a portfolio managed by the CNBC Investment Club, holding shares in Alphabet, Amazon, Apple, Meta, Microsoft, and NVIDIA.
However, even these giants are not immune to the influence of broader market forces. Kramer compares them to aircraft carriers – more capable of withstanding turbulent environments than smaller vessels, but still susceptible to the impact of strong economic currents.
On Wednesday, these pressures became evident: as concerns about conflicts with Iran intensified again, oil prices rose; at the same time, Federal Reserve Chairman Kevin Warsh warned that inflation was still high, and the possibility of further interest rate hikes remained.
"I listened to all this, but I didn't hear anything that would be sufficient to bring down these largest companies," said Kramer.
Microsoft's latest financial report is a prime example of this. After the software giant announced results and revenue that exceeded expectations, its stock price rose by 4% in after-hours trading. Revenue increased by 19%, with its cloud business growing by 48%, which is a further acceleration from the previous quarter's 42% and also surpassed expectations. Despite continuing to invest in artificial intelligence infrastructure, Microsoft's expenditures on capital spending and finance leasing amounted to $45.2 billion, which was still below Wall Street's forecasts, demonstrating its discipline in spending.
"This is the winner among tonight's financial reports from the 'Big Seven,'" he said, but also reminded that Microsoft's conference call and performance guidance could still change investors' perceptions.
At the same time, the performance of Alphabet indicates that even dominant technology companies are facing risks. After Google's parent company's performance and revenue fell short of expectations, its stock price dropped by 7%. Although revenue grew by nearly 25% and Google Cloud's sales more than doubled, its core search business still fell short of expectations, raising new concerns in the market about the impact of artificial intelligence on Google's advertising business. The free cash flow was also negative by $9.1 billion.
“Tonight we saw why ignoring these stocks can come at a cost,” he concluded. “We didn’t see anything that shocked us. Nor did we see anything that angered us. Alphabet may face one or two downgrades, and its search business might indeed be affected. But what about Microsoft? It’s proving that its surge since the low point at the end of June this year is justified.”












