Key facts
- Technology stocks outperformed consumer stocks on Friday.
- Dell Technologies reported record first-quarter results with revenue up 88% year over year.
- Dell's AI server revenue increased by 757% year over year.
- NetApp, Okta, and PagerDuty reported earnings that exceeded expectations.
- Gap Inc. shares declined due to weaker performance at Old Navy.
- ServiceNow shares rose on easing concerns about AI disruption and an expanded partnership.
The divergence in performance between technology and consumer stocks on Friday was largely attributed to differing investor expectations for incremental earnings growth versus margin and demand pressures. Technology companies are benefiting from an active capital expenditure cycle, particularly in enterprise AI spending, cloud infrastructure, cybersecurity, and automation, leading to accelerating revenue growth and guidance raises. Conversely, consumer-facing companies are contending with softer discretionary spending, more selective purchasing behavior, inventory risks, and promotional pressures, resulting in weaker comparable periods and more cautious outlooks.