Meta and Microsoft’s blockbuster earnings, Figma IPO day!

Business news update for Friday, August 1st.

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Welcome to Capital Currents—where the flow of business news and market trends keeps you ahead of the tide. I am your watchdog and today is Friday, August 1st.

**Meta and Microsoft’s blockbuster earnings, Figma IPO day!**

In today's episode, we'll dive into blockbuster earnings from Meta and Microsoft and preview Figma's IPO, which starts trading today. We got a great show—let's go.

Things got off to a strong start yesterday after the GDP report showed the US economy grew 3% in Q2—well above the 2.3% expected. But by the afternoon, Jerome Powell’s comments sent markets into the red.

As expected, the Fed left interest rates unchanged. But Powell’s tone caught investors off guard. The markets were hoping for a hint that rate cuts might begin in September, but Powell came out hawkish.

The quote that stood out: Powell said the Fed doesn’t believe current interest rates are restrictive or holding back the economy. He also reiterated the Fed would take a “wait and see” approach due to the uncertainty around tariffs and their potential inflationary impact.

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Let’s run through some headlines, starting with Meta. They crushed earnings, beating expectations across the board. Q2 revenues rose 22% to \$47B, ahead of the \$44B estimate. Profits surged 36% to \$18B.

Meta’s core ad business—Facebook and Instagram—continues to grow, and they see more upside. For this quarter, they expect 17–24% revenue growth. CEO Mark Zuckerberg credits AI for these gains.

Zuck is all-in on AI. Beyond his new “superintelligence” team offering NBA-sized contracts to top engineers, Meta plans to spend \$72B this year on capex—mostly on AI infrastructure and data centers.

Meta stock is up 10% today. When Zuck bet on the Metaverse, he got clowned. Now, after nearly \$70B in losses from Reality Labs (including \$4.5B in Q2 alone), he’s successfully pivoted to AI—and investors love it.

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Next up: Microsoft. They also posted blowout earnings, thanks to AI turbocharging their cloud business. Azure cloud revenue grew 39% in Q2—above the 34% analysts expected. Azure generated \$75B over the past year.

For the first time ever, Microsoft disclosed Azure’s annual revenue, which shows just how strong the numbers are. Net income was up 24% to \$27B.

Microsoft continues to justify its AI investments. CFO Amy Hood said next quarter’s capex will top \$30B—up 50% year-over-year.

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Let’s talk about Figma. The collaborative design platform makes its public debut today—one of the most hyped IPOs of the year. Figma priced at \$33 a share, a 250% jump, giving it a \$19B valuation.

That’s near the \$20B Adobe offered in 2022 before regulators blocked the deal. But today, IPO demand is off the charts. Bloomberg reports the offering was 40x oversubscribed—double what Circle and Chime saw.

Figma is expected to begin trading later this morning or early afternoon.

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And finally, Carvana. The stock is soaring after posting record used car sales. Revenue jumped 42% and net income rose 6x. But here’s the twist—most of that profit came from loan sales.

Carvana made \$274M from loan sales—out of \$308M in total profit. It echoes what we said yesterday about Harley-Davidson selling its loan division. Lending is where the real money is.

Carvana shares are up 15% this morning—and up more than 10,000% since their 2022 lows. Honestly, Carvana is like a meme stock that never stopped memeing. It just keeps going up.