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The stock market powered higher today to kickstart November on a positive note, driven by a combination of strong earnings and encouraging economic data. Several tech companies delivered good numbers last night, topping estimates and confirming both the resilience of the U.S. economy and strength of the AI Boom. As we’ve been saying for weeks, the fundamental earnings trends underlying the stock market are very positive and highly supportive of continued stock market strength. Last night, tech juggernaut Amazon (AMZN) reported very impressive quarterly numbers which underscored one powerful reality: AI can dramatically improve your business. Just look at what Amazon's doing. It is using AI across all its major operating businesses to boost revenues and profit margins. How AI Supercharged Amazon On the retail side, Amazon is deploying more robotics to automate fulfillment and unlock operational efficiencies. Its newest 12th generation robotic fulfillment center design, for example, is reducing fulfillment processing time by up to 25%, increasing the number of items it can offer for same-day or next-day delivery. What's more, it's expected to drive a 25% improvement in its cost to serve. The result is that Amazon can deliver more products at lower prices (driving accelerated retail revenue growth) while simultaneously cutting expenses and boosting profit margins (driving huge profit margin expansion and even bigger profit growth). Amazon saw both its online and physical retail sales growth rates accelerate in the quarter, while operating margins soared by about 300 basis points year-over-year. On the advertising side, Amazon is rolling out genAI-powered creative tools across display, video, and audio, including a video generator that uses a single product image to curate custom AI-generated videos. This is driving increased engagement with the ad business and sustaining approximately 20% revenue growth in that business even as it grows. Meanwhile, on the cloud side, Amazon Web Services – or AWS – has grown its AI business into a multibillion-dollar revenue run rate business that continues to grow at a triple-digit rate. Indeed, AWS AI is growing more than three times faster at this stage of its evolution than AWS itself grew. The AI cloud business is absolutely surging right now, and that is driving sustained growth rates of around 20% for all of AWS. Across its entire business, Amazon is figuring out how to harness the power of AI to improve its products, launch new products, and unlock operational efficiencies – the sum of which is driving accelerated revenue growth, big profit margin expansion, and huge profit growth. Amazon's revenue growth rate accelerated higher to 11% this past quarter. Profit margins expanded by almost 300 basis points. And operating profits rose more than 55%... Ultimately, all these financial gains are driving stock market gains for AMZN, too. Amazon's stock is rallying strongly today and is now up about 45% over the past year. Big Tech Gets an AI Boost Amazon is not alone here. Its Big Tech peers – including Alphabet (GOOGL), Microsoft (MSFT), and Meta (META) – are also all using AI to improve their business results. Alphabet has improved Google Search with AI Overviews, Meta has improved Facebook and Instagram feeds with AI-powered recommendations, and Microsoft has improved Office 365 with 365 Copilot. AI Overviews are driving increased Google Search usage... AI-powered content algorithms are driving increased time spent on the Facebook and Instagram platforms... And about 70% of Fortune 500 firms have signed up for Office 365 Copilot. Alphabet, Microsoft, and Meta are all using AI to improve their existing products, and in response, usage of their existing products is rising strongly. Meanwhile, all three are also using AI to launch new products. Alphabet has created its new AI model, Gemini. According to management, Gemini growth is surging right now. Meta has launched its own Meta AI assistant within its apps. That AI assistant already has 500 million monthly active users. And Microsoft has launched its AI-powered data analytics platform Fabric, which is already being used by more than 70% of the Fortune 500. Meanwhile – like Amazon – Alphabet, Meta, and Microsoft are also figuring out how to drive operational efficiencies with AI. For example, both Meta and Alphabet reported several hundred basis points of profit-margin expansion this past quarter (same as Amazon). The Final Word So... Amazon, Alphabet, Meta, and Microsoft are all using AI to improve their existing products, launch new products, and boost profit margins, which is leading to supercharged revenue growth at all three firms and supercharged profit growth, too. Folks, the AI opportunity is confirmed. Sure, a lot of pundits out there are calling AI a bunch of hype and saying this is a bubble. But what Amazon, Meta, Microsoft, and Alphabet reported this week wasn't hype. It was real revenue growth. It was real usage growth. It was real profit margin expansion. It was real profit growth. It was proof that the AI Boom is real. It was confirmation of the huge AI opportunity. And further confirmation that AI stocks will likely remain the big winners on Wall Street so long as stocks keep pushing higher – which we think they will for the foreseeable future. On that note, click here to check out a few AI stocks we're following closely in our research services right now. Sincerely, | 
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