Squawk on the Street SOTS 2nd Hour: Big Tech, Big Earnings - Investor Takeaways from Meta, Microsoft, Tesla & More Results 1/29/26
Jan 29, 2026
Ben Reitzes, head of technology research at Melius Research, offers views on IBM and Microsoft. Laura Martin, senior equity analyst at Needham, breaks down Meta and ad-driven tech. They discuss Meta revenue and capex, Reality Labs losses, IBM’s AI and software positioning, Microsoft execution and Copilot uptake, and Tesla’s shift toward Optimus and production cuts.
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Meta Spending Leaves Little Cash Cushion
- Meta plans to spend nearly all incremental revenue on operating expenses and AI investments, leaving little free cash flow.
- Laura Martin warns this execution is priced for perfection and misses could cause a 10–15% downside.
IBM Sees AI Driving Software Growth
- IBM reports accelerating organic software growth and quantifies $4.5 billion in savings from applying AI internally.
- Arvind Krishna positions IBM as infrastructure-software beneficiary as enterprises adopt AI.
Infrastructure Software Could Outperform SaaS
- Analysts view IBM's free cash flow quality as superior to many SaaS names and believe it warrants a premium multiple.
- Ben Reitzes expects infrastructure software to outperform SaaS amid AI-driven disruption.