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Public.com presents the rundown, your daily market update in under 10 minutes. My name is Zadad Mani and Today is Thursday, February 5th. In today's episode, we'll explain why the market might actually be healthy despite the drop in the stock market. We'll also recap earnings from Google, Snap and Qualcomm, then stick around to the end of the show to learn more about Nintendo's upcoming VR headset. We got a great show for you today. Let's go. Stocks were down for the second straight day on Wednesday and once again it was tech stocks doing the damage. The S&P 500 dropped 0.5% while the Nasdaq got absolutely crushed, falling 1.8%. You know, this marks the Nasdaq's worst two day stretch since last April's tariff chaos. Overall, for the year, the Nasdaq is down 1.4% while the S and P is basically flat. But if you look at the equal weight S&P 500 index, which treats each stock equally in the S and P, that's up 4% and hit all time highs yesterday. So while tech is getting hammered right now, most of the market is doing just fine. Now we're not seeing this broad market sell off. What we're seeing is a classic rotation out of tech and into other sectors. This rotation started late last year and it seems to be accelerating this year. And historically, this kind of market breadth is actually a healthy sign. You know, one of the big criticisms over the last couple of years was that the stock market was too top heavy, with most of the returns coming from mega cap tech tech stocks. But that's finally starting to change. We'll have to see if this rotation continues. We'll see how things play out over the next few days and weeks as we move through earnings season. Amazon is reporting earnings today after the bell, which should give us a read on consumer spending and cloud growth. And then next week we're getting major software stocks reporting earnings like Monday.com and Datadog. So we should get some more clarity on the software sector. We're staying on top of all this stuff, so it's a great time to get subscribed to the podcast and tuning in every day to stay in the loop. Let's run through some headlines. Headlines starting with Google. Google reported earnings last night and despite putting up monster numbers, the stock is still down this morning. Let's talk about the numbers. Q4 revenues were up 18% to $114 billion and profits were up 30% to $34.5 billion. That is insane. And if you look at the full year of 2025, Google crossed $400 billion in revenue for the first time ever, putting them as Apple and Amazon. Google search and advertising business continues to be a cash printing machine. It grew 17% year over year, pulling in $63 billion last quarter. So there's no signs that ChatGPT and other AI tools are stealing Google's users and impacting their search business. Now, looking beyond the search business, the big growth story for Google continues to be Google Cloud, which is absolutely exploding. Cloud revenue hit $17.7 billion in Q4, which was up 48% year over year. That the cloud business on a $71 billion annual run rate, which is insane considering that it was under $20 billion just four years ago. Google's cloud margins are also improving. They jumped to 30%, proving that the cloud business is finally a real profitable sector of the company. And there's no signs of slowing down either. Google said that its backlog of cloud contracts more than doubled to $240 billion. And speaking of AI, Google also said that their Gemini AI app now has 750 monthly active users, which is up from the 150 million last quarter. So more and more people are using Gemini, including myself. And Google just has a lot of momentum right now. But despite those incredible numbers and growth that I just told you, Google stock is down like 5% this morning. And it's because of what Google said about its capex. Google said they plan to double their capex spending this year to $180 billion, which is way above the $120 billion that Wall street was expecting. And this caused investors to freak out. Now, CEO Sundar Pichai defended all this spending, saying that AI demand is there and that Google needs to build more capacity to meet the demand. You know, the $180 billion will go towards building AI data centers, developing AI models, and buying the chips to power everything. But investors seem to be nervous about all this spending. I think six to 12 months ago, this would have been okay, but the vibe has completely shifted. We also saw this happen with Microsoft's earnings last week. They reported solid growth, but yet the stock had a record drop because of the massive CapEx spend. Now, to put the $180 billion CapEx spend into perspective, Google generated $165 billion in cash last year. So they're literally spending all of their cash on AI infrastructure. So because of this narrative shift, Google is now going to have to convince the market that all this capex spend is Justified. It just goes to show you how things have changed. Even putting up monster quarterly numbers like Google just did isn't enough anymore. Let's shift gears and talk about SpaceX, because Elon is making some pretty bold moves ahead of what could be the biggest in history. Now, SpaceX is planning to go public later this year at a valuation of over $1 trillion. And according to the Wall Street Journal, SpaceX advisors have been quietly reaching out to major index providers, including the Nasdaq, to see if the company can get added into the major stock indices almost immediately after its ipo. See, normally newly public companies have to wait several months, sometimes up to a year, before joining indices like the NASDAQ 100 or the S P 500. And this waiting period exists to make sure the company is stable and liquid handle all the massive buying from the index funds. But SpaceX wants to skip the line to help support their stock price. Because once a stock gets added to a major index, ETFs and index funds that track that index are forced to buy it no matter the price of the stock. So that creates instant demand, boosts liquidity, and helps support the stock price. Now, what's interesting is that the Nasdaq recently proposed a fast track rule that would allow companies ranking in the top 40 by market cap to join the NASDAQ 100 index after just 15 trading days. And if SpaceX does IPO at a trillion dollars, they would easily qualify. I think SpaceX has seen what's happened to stocks after the IPO hype. You know, Figma and others are down big from their IPO, and I think SpaceX is trying to avoid that by bringing in the index fund money. So we'll see if SpaceX pull this off. But like I said earlier this week, Elon and his team are the masters of financial engineering. Let's talk about some stocks making moves today. Shares of Snap are moving higher this morning. That's not something you hear very often. After the company delivered a surprise profit in Q4, Snap reported net income of $45 million in Q4, which is kind of a big deal for them because they've been unprofitable for most of their existence. Revenues also came in better than expected, up 10% year over year to $1.7 billion. So how did Snap pull this off? Well, they cut back on spending, especially in marketing. That pullback in spending helped boost their margins and and their profits. But there was a trade off for the cutback in spending. Their daily active users dropped by 3 million globally in North America Daily active users came in at 94 million, missing Wall street estimates of 97 million. But, you know, despite the drop in users, I think investors are loving the fact that Snap actually made some profit. And Snap stock was up more than 7% after the earnings. It's given back some of those gains, though. It's now up around 2% at the time of this recording. Now, on the flip side, Qualcomm stock is getting quite crushed this morning, despite beating on earnings. The problem for them was their weak guidance. Now, the company blames the weak guidance on supply constraints, especially memory chips. See, Qualcomm makes the processors that go into smartphones and PCs. But phone makers also need memory chips to pair with these processors. And right now, all the memory chips are being bought up by these AI data centers, leaving smartphone makers scrambling for supply. And because of that, smartphone and PC makers are cutting back back on production, which means fewer orders for Qualcomm's chips. And that's why Qualcomm stock is down around 10% this morning at the time of this recording. You know, I know we mentioned this memory chip shortage quite often, but, like, it's continuing to become a bigger and bigger story and impacting a lot of companies. Let's wrap the show with a fun fact. Nintendo is bringing back the Virtual Boy VR headset. Now, for those of you guys too young to remember, the Virtual Boy was Nintendo's attempt at VR back in 1995. It was this red headset on a tripod that you had to hunch over to play, and all the games were displayed in red and black. Yeah, it was a total flop and it gave people headaches. Barely anyone bought it and it was discontinued within a year. Well, now Nintendo is bringing it back on February 17 as a 100 accessory for the Nintendo Switch. You know, I get that Nintendo is leading into the nostalgia, but, like, nobody's gonna buy this, right? I don't know, maybe I'm wrong here, but let me know in the comments. I also find it funny that, like, companies have been trying to do VR for like 30 years, and every time the market just rejects it. I've been saying this for years now. Nobody wants a thing on their face. VR is not gonna happen. Well, all right, guys, that's the rundown for today. Hope you guys enjoyed today's episode. If you did and you have like five extra seconds, consider giving us a five star rating on Apple, Spotify, YouTube, wherever you listen to your podcast. If you are listening on sp, don't forget to vote in today's. Spotify poll. Leave us a comment on Spotify. All that engagement really does help us out and it helps other people find the show. Thank you guys so much for listening, watching and commenting. Shout out to Mike and Connor for all the work behind the scenes and we'll see you guys back here tomorrow.