Surging Yields Flip From Burden to Boon in Big Tech Earnings
- Higher rates are boosting interest income for tech giants
- Big 7 tech firms entered 3Q with cash exceeding $500 billion
The tech-heavy Nasdaq 100 is still sitting on 35% gains year-to-date, versus an 11% climb for the S&P 500.
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Amid a rocky earnings season for giant companies, cash-rich megacap tech stocks have found an unlikely friend: soaring yields in fixed-income markets.
Buried in results that have sent shares veering has been the benefit of rising rates on cash surpluses that for the largest firms total more than half a trillion dollars. Google-parent Alphabet Inc. said Tuesday that interest income almost doubled to more than $1 billion, while Tesla Inc. saw the line item soar to $250 million.