Cramer Sticks with Major Tech Stocks Despite Earnings Struggles
On Thursday, Jim Cramer from CNBC expressed his commitment to the largest tech companies, even though many have recently reported disappointing earnings.
“At some point, one of these firms is going to announce a rise in earnings estimates tied to their AI products, and you’ll see a significant uptick. And when it happens, you might feel regret for not getting in sooner,” noted the “Mad Money” host.
The so-called “Magnificent Seven,” which once drove market growth during the generative AI boom, is facing challenges in 2026. Stocks from notable companies like Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla are experiencing uneven performance. Cramer pointed out that these stocks are often mistakenly compared, even though their businesses and AI strategies differ greatly.
“We need to stop comparing and start thinking critically,” he advised. The CNBC Investment Club’s portfolio holds six out of the seven Magnificent Seven stocks, with Tesla being the exception.
Cramer highlighted that Meta plans to begin manufacturing its own AI chips later this year, which is part of a broader strategy to enhance its computing capabilities. Initially, the market reacted negatively to this, interpreting it as a sign that capital expenditures would remain high. This development follows reports that Meta is exploring new avenues for selling computing power, an area where cloud giants like Amazon, Alphabet, and Microsoft dominate.
Some investors may doubt Meta’s ability to compete with these established players, but Cramer suggested that the market might overlook certain advantages that Meta has. He remarked, “Perhaps we should trust that Mark Zuckerberg understands his company’s potential better than we do. He’s demonstrated that repeatedly.”
Similarly, Cramer pointed out that Alphabet’s steep investments in AI and the competition from chatbots like ChatGPT might be overshadowing the value from other business segments like YouTube and Waymo.
While Cramer acknowledged that major tech stocks often move in tandem, he believes that if just one company reveals that its AI division is profitable, it could change everything. “If one of these big players shows real profitability from their AI, then traditional semiconductor stocks will take a back seat. You’ll likely prefer a hyperscaler generating massive cash flow,” he said.
