Weekly Buzz: We're breaking down the latest earnings season

This quarter’s earnings season has delivered rather impressive numbers so far. According to FactSet, US firms are beating forecasts at the highest rate since 2021, and by wider margins. Markets are optimistic, but look closer and you'll find a lot of that strength concentrated in a familiar group.

The rundown on revenue

Living up to their name, the Magnificent Seven have headlined this quarter’s earnings season in the US. Four out of five of the tech giants have comfortably beat expectations:

• Alphabet, Google’s parent company, reported revenue crossing $100 billion for the first time.
• Amazon beat earnings expectations by 25%, thanks to acceleration in its cloud business.
• Apple exceeded revenue estimates by 5% despite concerns about weakening consumer spending.
• Microsoft topped forecasts, with the company pointing to cloud services as a key driver.
• Meta disappointed, missing estimates despite posting strong revenue growth.

Tech in general has led earnings growth for the S&P 500, alongside the financial sector. Then there's everyone else. Across earnings calls, executives at Kimberly-Clark, McDonald's, and other retail-focused companies described US shoppers as cautious – housing costs, persistent inflation, and tariff uncertainty are weighing on consumer spending.

What’s the takeaway here?

Tech’s performance has been exceptional, and AI has real fundamentals supporting it. These firms are generating revenue from AI services, not just spending on infrastructure. At the same time, the market's focus on a handful of names means shifts in sentiment hit harder. In other words, if Big Tech stumbles, there's less support underneath.

Diversification across asset classes, sectors and geographies reduces that concentration risk. It means participating in tech's growth while maintaining exposure to opportunities around the world.

(For a portfolio that’s designed with diversification in mind, check out General Investing.)

Investor’s Corner: How to keep your portfolio strong and your cash handy

Investors tend to keep a pile of cash on the sidelines. It makes sense: cash feels safe because it doesn't crash. Cash doesn't grow, though. When your money sits idle, you miss out on compounding returns. Even a few months out of the market can detract from long-term returns.

The tension isn't really between safety and growth – it's about liquidity. Liquidity refers to how quickly you access your money. It matters because life doesn’t always stick to the script. Your car needs repairs. A once-in-a-lifetime trip pops up. It’s about finding a balance: enough liquidity for emergencies and planned expenses, while keeping the bulk of your portfolio invested for long-term growth.

For your liquid reserves, money market funds offer a middle ground. These funds invest in very short-term debt, typically maturing within days or weeks. They generate higher yields than regular savings accounts with daily liquidity. Short-term bond funds are another option. These invest in bonds maturing in 1 to 3 years. They carry slightly more risk than money market funds, yet they also pay higher interest.

The goal isn't choosing between safety and growth. It's structuring your portfolio so both work together.

(If you’re looking for an easy way to keep your cash liquid and growing, check out Simple.)

Simply Finance: Revenue vs earnings

Revenue is the total money a company brings in from selling its products or services. Earnings is what's left after paying all the bills – salaries, rent, taxes, everything. A company can grow revenue but shrink earnings if costs rise faster than sales.