STMicro Lifts AI Outlook as Alphabet Slides 12.6%

Fri, Oct 30 ~2 min read ✓ Reviewed by Get AI Decoded Editorial Team

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Two earnings signals show investors rewarding AI revenue while scrutinizing the cash needed to produce it.

🗄️ STMicro raises its AI data-center forecast

Decoded: STMicroelectronics (STM) now expects about $1.3 billion of data-center revenue in 2026, up from a July forecast above $1 billion, and kept its 2027 target at well above $2 billion, Reuters reported Thursday. Adjusted operating income nearly doubled from a year earlier to $429 million, beating the $400.5 million LSEG consensus, as silicon-photonics demand strengthened.

Why it matters: Revenue from moving data between servers is becoming material enough to lift STMicro's outlook. That broadens AI infrastructure exposure beyond accelerators and memory into optical connectivity.

📊 Alphabet's results revive AI spending concerns

Decoded: Alphabet (GOOGL) shares fell 12.6% Thursday after a quarterly revenue miss and faster AI-related cash burn, according to Reuters. The Nasdaq Composite lost 1.37%, while semiconductor shares ended a four-session winning streak with a 1.4% decline.

Why it matters: The selloff shows that investors are separating companies generating near-term AI revenue from those accelerating spending faster than expected. Execution and funding capacity are becoming as important as the size of an AI roadmap.

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— The Get AI Decoded Team