Investors, traders and speculators welcomed beat-and-raise earnings announcements from two up-and-coming technology companies and a positive forecast from an aircraft maker as the main U.S. equity indexes got back into the green on Tuesday. Momentum ebbed briefly, but fundamentals grounded in the AI revolution and the power of flight carried the trading day.
Everybody from Washington, D.C., to Wall Street is alert to President Donald Trump's weekend revelation that he knows whom he will name as the next Fed chair. Trump said today he will announce his choice early in 2026, though markets remain more focused on the next Fed meeting.
In the meantime, the delayed release of September Personal Consumption Expenditures Price Index (PCE) data on Friday is the highlight of this week's economic calendar. CME FedWatch shows an 89.2% probability the Federal Open Market Committee will cut interest rates by 25 basis points when it meets next week.
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"After an opening stumble yesterday, stocks are catching a bid today," observes Louis Navellier of Navellier & Associates. "It's being led by semiconductors again, as the volatility of the AI theme has picked up, despite the pledges of an enormous build-out of data centers."
Navellier notes a challenge to Nvidia (NVDA, +0.9%) as the leader of the AI revolution from Alphabet (GOOGL, +0.3%), with Amazon.com (AMZN, +0.2%) joining the competition today with the introduction of its own new AI chip.
Meanwhile, Boeing (BA, +10.2%) was No. 1 among the 30 Dow Jones stocks after Chief Financial Officer Jay Malave said the aircraft maker expects deliveries of its 737 and 787 jets to be up next year. Malave also said Boeing will generate positive free cash flow in the "low single digits." Boeing hasn't reported a profit since 2018.
"Expectations are still high for a strong finish to the year," Navellier concludes, "but we may have to get the Fed cut for the positive momentum to arrive."
At the closing bell, the tech-heavy Nasdaq Composite had added 0.6% to 23,413, the blue-chip Dow Jones Industrial Average was up 0.4% at 47,474, and the broad-based S&P 500 had risen 0.3% to 6,829.
MDB and CRDO see an AI boom-and-bounce effect
MongoDB (MDB, +22.2%) was up as much as 27.6% to a new 52-week high after management of the large-cap stock reported earnings of $1.32 per share (+13.8% year over year) on revenue of $628.3 million (+18.7% YoY), beating a consensus forecast for EPS of 81 cents on revenue of $593.8 million.
CEO CJ Desai cited continued strength in MongoDB's Atlas product, which saw annual sales growth of 30%, and "meaningful" margin outperformance. "Reflecting this strength," Desai said, "we are raising our guidance on the top and bottom line for the rest of the year." The document database provider upped its full-year EPS guidance from a range of $3.63 to $3.73 to $4.76 to $4.80.
MDB stock is up more than 40% year to date but remains more than 45% below its November 16, 2021, all-time high of $585.03.
"Companies across industries and geographies are choosing MongoDB because we provide a unified data platform that powers mission-critical workloads today and also positions them to capitalize on the emerging AI platform shift," the CEO said.
Credo Technology (CRDO, +10.1%) also reflected the impact of the AI boom (and provided, for now, relief from worries about an AI bubble), rising as much as 24.9% on strong results and upbeat guidance.
Management reported EPS of 67 cents (+28.8% YoY) on revenue of $268.0 million (+272.1% YoY), ahead of Wall Street estimates of 49 cents on $235.0 million. Gross margin was 67.7%.
"These are the strongest quarterly results in Credo's history," CEO Bill Brennan said, noting Credo's 20% sequential and 272% annual revenue growth, "and they reflect the continued build-out of the world's largest AI training and inference clusters." Management expects to see fiscal third-quarter revenue of $335.0 million to $345.0 million and gross margin between 64.0% and 66.0%.
Brennan says continued growth for Credo's core franchises, as well as ramp-ups for recently introduced products and services, establishes "an outlook with strong revenue growth and profitability through fiscal 2026 and beyond."
Earnings are fundamental
It is a relatively light day for reporting, but the earnings calendar remains a source of support for a bull market.
"Operating earnings at S&P 500 companies should hit an all-time high of $618 billion for the third quarter of 2025," writes Jason Zweig, author of The Intelligent Investor column for The Wall Street Journal, citing estimates from S&P Dow Jones Indices.
"That's up a remarkable 14% over the second quarter, itself a record," Zweig notes. Profit margins of 13.6% are also at record levels.
Tech stocks Asana (ASAN, +4.9%), Box (BOX, +2.9X%), CrowdStrike (CRWD, +2.5%), Gitlab (GTLB, +5.4%), Marvell Technology (MRVL, +2.0%), Okta (OKTA, +1.5%) and Pure Storage (PSTG, +7.1%) are scheduled to release results after the closing bell. American Eagle Outfitters (AEO, -1.9%), a consumer discretionary stock, will also reveal numbers this evening.
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