Cramer handicaps the collision of 2 more Big Tech earnings and the jobs report
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CNBC Finance
11 min read
We're getting a one-two punch â Alphabet on Wednesday evening and Amazon on Thursday evening â that should define the week â at least, until Friday's employment data. These companies, both nation-states with seemingly unlimited capital, are run by the finest executives, both attuned to stock market reaction and the image it creates. That's far different from last week's earnings. Apple puts up with the market. Meta Platforms barely tolerates Wall Street. Tesla does not care at all beyond the desire to spoof it. Sadly, Microsoft has gotten a tad ethereal, and I found myself confused by the post-earnings week's conference call. Judging by the stock price, I wasn't alone. Alphabet from A to Z Alphabet has been a magnet for money, and it does everything, and I mean everything â right down to talking about seeking funding for its self-driving ride service Waymo at a reasonable $110 billion valuation. I know that Waymo is small potatoes compared to so much of Alphabet, but it is big potatoes for a public starved of anything that a consumer might be fascinated by, hence the love for Elon Musk . Waymo rides are great fun. They are even better as a template for generations of non-drivers to come. Sure, a Jaguar robotaxi is expensive, but there could be iterations that we don't know about. Suffice it to say: buy, buy, buy. The nuts and bolts of much of Alphabet are controlled by Ruth Porat, who is â not probably â but is the most savvy executive in the country. How in heck she can be both unassuming and kind, I do not know. Her title as president and chief investment officer confounds in the amorphous way of Alphabet; after all, Sundar Pichai is the CEO, and he is hands-on. But when it comes to how the company acts and looks, we are all so accustomed to Ruth in her former role as CFO running the tightest post-earnings conference call in the business, that we ascribe mythical powers to her when it comes to interaction with Wall Street. Three words, Best There Is, come to mind. A year and a half ago, Alphabet was an underdog. Many of us were worried about Google and its relationship to a suspect bot that seemed a distant last in the generative artificial intelligence race. At the same time, we were blown away by the bluster of the Justice Department's antitrust crusade against the company. At the time, Judge Amit Mehta had ruled that Google â have you noticed we have all almost stopped using the clumsy Alphabet â was a monopolist. Handed that victory, the Justice Department ran amok with tales about how this time, as opposed to Microsoft more than two decades ago, they would really punish tech â namely, Google, stripping it of all of its most lucrative parts. It was almost as if they were going to make the Bing search engine come back to life. The talk sure scared me, and we left the stock even after I had been assured by Google's fantastic counsel that they would win. Counsel was right. In September 2025, the judge reversed himself and, I think, made Google more powerful than ever, king of the internet road. No more monopolist. And, in the twisted way of someone who really screwed up, the judge blessed the $20 billion payment to Apple to be the foundational search partner by using the twisted logic that said Apple would be a more powerful competitor in reigning in Google. Ouch. That ruling was designed to propel Google to the stratosphere, and it did. When it got to the stratosphere, we found out how good Gemini was â when Gemini 3 launched back in November. All of our fears about what Google could do to hobble its own initiative left. Instead, we learned that this powerful combination leaped to the top of the consumer heap. Sure, Anthropic is the winner of the business-to-business (B2B) code-disabling/writing world. Musk's Grok and Meta AI have purpose within their own eclectic worlds, and OpenAI's ChatGPT has a first-mover advantage that might never be dislodged. But, like any other stellar consumer product, once you try Gemini, you will never go back. It is not mistake-free, and the information must be verified. It is, however, damn good. I love it. There's more. The two real stars of Alphabet are YouTube and Google Cloud. YouTube has become the world's video locus. It's a lot cheaper than the cable package â which, at its height, cost me $150 a month before I cut the cord for YouTube. It's almost humorous to hear about customers lost for Comcast video, knowing that it is ultimately analogous to America Online. Brutal, but I am among friends. The brilliant steal of the NFL via the incredibly football package cemented YouTube as the hitherto unthought-of better than linear presentation. I have no idea what YouTube is worth; perhaps it is as much as Alphabet stock? The engine behind the company's success, though, might be the cloud and its imperious boss, Thomas Kurian â who, in eight short years, has positioned Alphabet as a top partner for pretty much anybody who doesn't want to use the biggest cloud Amazon Web Services (AWS) or No. 2 Azure from Microsoft or wants to leave them for a similar product. I met Kurian when it started, and he came at me hard with how he would be No. 1 someday. Unfortunately for him, the other guys have titans behind them. Unfortunately for them, they have, at times, been unwilling to admit that there's a third in the race. The funniest thing about this whole juggernaut is that Google won ages ago and yet keeps winning. No one ever left it because it is fabulous; oh, I forgot to add that everything they do is fabulous. Google's search relationship with Apple solidified world dominance. Google's Gemini allowed the tables to be turned on Apple. Now, Apple is paying Alphabet to use Gemini. Then again, Gemini obviated the need for Apple to spend any money to make Siri great. Apple's failure to make Siri good and, instead, allowed it to team up with Gemini, proving without a doubt that it is better to be lucky than good. Can you imagine how much Apple would be hated by analysts if it built its own AI spear instead of cribbing from Alphabet? This behemoth reports after Wednesday's closing bell, and I am calling it amazing ahead of listening to its call. Amazingly, it's not even dangerous to do so. It would be Double Jeopardy for Justice to go after them, and it will be like winning Double Jeopardy on the show. It can be that good. It could, all by itself, make Thursday's session stupendous. Big Amazon question mark The big question is: What will Amazon's earnings Thursday's evening do for Friday's session? Apple is disliked, and the analysts pine for Steve Jobs. Amazon is disliked, and the analysts pine for Jeff Bezos. Cards up: I think Amazon is divine, and Andy Jassy is a fantastic CEO. We all seem to forget the Covid pandemic and how Amazon triumphed over brick and mortar in a few short months. Now, we just think Amazon's some bloated kraken. We love Prime as much as we love our iPhones, but it means nothing to their respective stocks. That's because they are known as B2C â business-to-consumer â and we would rather pay anything for B2B and next to nothing for B2C, because it is thought to be fickle and therefore the stuff of low multiples. Not only that, but who would have thought that Walmart would sneak up to challenge Amazon in e-commerce, other than those who go to Walmart, which means not anyone on Wall Street. Amazon does have B2B â and, in keeping with Wall Street's dislike of the "consumer," this is the division that matters. Sadly, Wall Street's rap on AWS is that it is old and not the platform to start a business on. When it was going down in its growth rate, Amazon was easily dismissed. Now that it is going up in its growth rate, Amazon is easily dismissed, too. Remember, Wall Street is mercurial and two-faced, so it's possible to be judged poorly on the way down and the way up. Along the way, Amazon has destroyed the drug store chains, emasculated the department stores, and is now going for the grocers in a pretty methodical way â and don't you say otherwise unless you are prepared for a lecture/tutorial in the brilliance of its strategy. I would rather have them say mistakes, they've made a few, but that's not their way, at least with the "press." We have a huge position in Amazon with the hope that they will somehow regain their luster. The company's defensive about this judgment, as I would be if I ran the best retailer on earth with a web service that's still the best there is, with the relatively fast growth rate given its size and a fantastic ad division. Am I too smitten? Sometimes I fear yes, but then again, I wasn't smitten enough when it came to Alphabet, and I have become a hanger-on to Microsoft. I have learned my lesson, though, with the hyperscalers. They tend to be given the benefit of the doubt. How else can a car company, Tesla, with huge but declining revenue, become a robot and self-driving cab company in a quarter without skipping a price-to-earnings (P/E) multiple beat? Jobs report wildcard Here's the difficulty of the week ahead. Amazon's so inscrutable a company that it lost the benefit of the doubt years ago. The Friday reaction to its earnings report collides with the government's nonfarm payroll report, and that could be combustible. If the jobs report, which is out at 8:30 a.m. ET this coming Friday, is weak, I can see President Donald Trump calling for Federal Reserve Chairman Jerome Powell to resign now, and calling him funny names. If the jobs number is strong, then we will have to hear about how Trump's pick to succeed Powell as Fed chief, Kevin Warsh, will be torn between fighting inflation by keeping interest rates high and pleasing the president by taking rates down. Unenviable. Powell's term as Fed chairman expires in May. That's a miasma, a poor confluence, and it doesn't lend itself to upside. The only real hope is that Amazon's stock gets clobbered going into the quarter, which might be difficult given that it probably rallies off of Alphabet's pristine quarter the night before. But if it happens, and the report is good, and Jassy is poignant, passionate, and not defensive on the call, we might actually make money in Amazon stock. Hallelujah. I am not oblivious to all the other cross-currents: a consumer packaged goods group propelled by a decent quarter from the moribund Colgate ;Â an oil sector jacked up by the prospective and existential attack on Iran; a metals cohort that seemed unstoppable until the Warsh appointment, although that might be serendipitous. Who knows how long the lack-of-memory chips will last? Wouldn't it be wonderful if Apple could just say to Intel : "We will take everything you make from that new foundry." Anything from Intel about how 18a could help solve the shortage would be most welcome. (Jim Cramer's Charitable Trust is long GOOGL, AMZN, AAPL, MSFT. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. 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