To The Moon

In this super earning week, around 30–35% of S&P 500 companies report results. Many stocks moved meaningfully after their reports, and some reactions were notable even when the numbers looked solid..

The stocks that held up best were the cleanest “AI-to-cash-flow” stories — companies that showed how investment, scale, or infrastructure demand is translating into real earnings and free cash flow.

We saw this strongest post-earnings moves in AI and enterprise software, semiconductor equipment, telecom infrastructure, and industrials. Across these sectors, investors focused more on margins, cash generation, and outlook clarity.

Against this backdrop, $IBM(IBM)$ , $Lam Research(LRCX)$ , $AT&T Inc(T)$ , and $Caterpillar(CAT)$ stood out as earnings winners this week, each offering a different but compelling path from secular demand to cash flow.

So Tigers —

Did any of these moves catch your eye? Are these names you’d continue to watch from here?

Looking ahead to next week, several major companies on the earnings calendar are set to report — including names like $Advanced Micro Devices(AMD)$ , $Alphabet(GOOGL)$ , and $Amazon.com(AMZN)$ . Which earnings are you most focused on, and what are you watching for? Feel free to share your thoughts in the comments 👇

Here is the deep dive into four stocks that defined this Super Earnings Week.

$IBM(IBM)$ : Cash Flow Over Hype — The Quiet AI Winner (+5.13%)

1. Fundamentals

• IBM is now software-led, with software at ~45% of revenue and 9% FY25 growth, the fastest in company history.

• AI monetization is enterprise-focused, spanning Automation, Data, Consulting GenAI, and IBM Z.

• IBM Z z17 boosts relevance in AI workloads, delivering 50% higher AI inference throughput vs. z16.

2. Financial Performance

• FY25 revenue +6%, the strongest growth in many years.

• Free cash flow hit $14.7B, the highest in over a decade.

• Q4 software +11%, led by Data (+19%) and Automation (+14%).

• ARR reached $23.6B, up >$2B YoY, improving earnings visibility.

• Operating margin +100 bps, supported by $4.5B productivity savings.

3. Outlook

• FY26 revenue growth: 5%+ (constant currency).

• Software growth ~10%; FCF guided at ~$15.7B (+~$1B YoY).

• Consulting returns to growth, backed by $32B backlog; Infrastructure slightly down due to cycle dynamics.

$Lam Research(LRCX)$ AI’s Picks-and-Shovels (+3.59%)

1. Core Business & AI Exposure

• Direct beneficiary of AI-driven semiconductor transitions, especially DRAM, advanced packaging, and leading-edge foundry

• Systems mix highlights AI leverage: Foundry 59%, Memory 34%, with DRAM at a record 23%

• Etch and deposition leadership (Akara, GAA, backside power) continues to expand Lam’s SAM and share

2. Earnings & Margin Quality

• CY25 revenue $20.6B (+27% YoY); gross margin 49.9%, highest since Novellus merger

• Q4 revenue $5.34B, tenth straight growth quarter; operating margin 34.3%

• CSBG ~$2B in Q4, growing faster than installed base, improving margin durability

3. Outlook

• March FY26 guide: revenue ~$5.7B, EPS ~$1.35

• 2026 WFE ~ $135B, weighted to 2H due to clean-room constraints

• China revenue flattish, becoming a smaller mix as AI-led segments scale

$AT&T Inc(T)$ : Exactly What the Market Wants (+4.40%)

1. Core Business Momentum

• Continued industry-leading 5G and fiber growth: 1.5M+ postpaid adds, 1M+ fiber adds in 2025

• Fiber convergence at 42%, up 200 bps YoY

• Fiber footprint to exceed 40M locations post-Lumen

2. Earnings & Cash Flow

• Q4 adjusted EPS $0.52 (+20% YoY); EBITDA up 4%

• FY25 FCF $16.6B, supported by >$1B cost savings

• Net debt/EBITDA 2.53x; liquidity $18.2B

3. Outlook & Returns

• 2026 EPS $2.25–$2.35, with double-digit CAGR through 2028

• Wireless service revenue +2–3%; advanced home internet 20%+

• $45B+ shareholder returns (2026–2028)

$Caterpillar(CAT)$ : Backlogs Over Buzzwords (+3.41%)

1. Demand & Visibility

• Record backlog $51B (+71% YoY); ~62% converts within 12 months

• Broad-based growth, led by Power & Energy (+23%), driven by data centers and power generation

• Structural support from infrastructure, mining capex, and energy transition

2. Earnings & Cash Generation

• Q4 revenue $19.1B (+18%), all-time quarterly record; EPS $5.16

• FY operating margin 17.2%, supported by pricing and mix

• MP&E FCF $9.5B, with $7.9B returned to shareholders

3. Outlook & Risks

• 2026 sales near top of 5–7% CAGR range

• Margins above 2025 but pressured by $2.6B tariffs and ~$3.5B capex

• Upside tied to faster capacity expansion; risks include tariffs and backlog conversion timing

As we move through the heart of earnings season, investors should enjoy the opportunities but remain mindful of risk control, especially amid potential short-term market pullbacks. Staying focused on fundamentals, balance-sheet strength, and cash-flow visibility can help navigate volatility with confidence. Wishing all investors a productive and profitable earnings season.

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