Tech Weekly: Stocks Mostly Shrug off Warsh's Hawkish Words

This week's tech sector performance

Global stock markets experienced quiet trading on Monday morning (August 24) as market participants evaluated newly imposed US tariffs on Canadian exports. Futures for Wall Street edged down, whereas TSX futures traded higher.

On Monday, US President Donald Trump outlined intentions to hike tariffs on Canadian automobiles and auto components to 50 percent starting January 1. This announcement came shortly after US tariffs on US$28 billion of Canadian products took effect when bilateral negotiations collapsed.

Early session activity saw gains in software stocks alongside a retreat in hardware suppliers. Investors stayed attentive to upcoming inflation metrics, NVIDIA's (NASDAQ:NVDA) financial results, and Fed Chair Kevin Warsh’s Jackson Hole keynote speech slated for later in the week.

Technology shares faced headwinds from mounting political resistance to AI data infrastructure. Axios reported Sunday that Texas Governor Greg Abbott warned the AI industry that data center companies “dug their own grave” by failing to secure local community backing.

Citing grid reliability concerns amidst public backlash, Abbott recently suspended state approvals for new data center power grid connections.

Both the S&P 500 (INDEXSP:.INX) and the Nasdaq Composite (INDEXNASDAQ:.IXIC) closed the session in negative territory.

Investors positioning themselves into the semiconductor space ahead of Nvidia’s earnings and the PCE inflation reading helped reverse the sell-off on Tuesday (August 25), sending all North American stock indexes higher by the closing bell. Nvidia broke its seven-day losing streak, closing up by 2.2 percent, while Advanced Micro Devices (NASDAQ:AMD) rose after Raymond James upgraded the stock. Falling oil prices and bond yields also improved investor sentiment.

Wednesday’s (August 26) inflation reading came in hotter than expected, sending indices lower. Tech was mixed, with Nvidia falling in regular trading and Meta Platforms (NASDAQ:META) leading gains among megacaps after it agreed to pay up to US$18 billion and make major changes to Facebook and Instagram to settle with US states that alleged the company built addictive products that hooked children and teens while it concealed the mental-health risks from the public.

On Thursday (August 27), the S&P 500 and Nasdaq closed higher again as Nvidia rallied after beating estimates and issuing strong guidance. Chip-linked equities rose broadly, driving a 2.3 percent rally in the semiconductor index.

Upbeat July-quarter earnings from Salesforce (NYSE:CRM) also sparked a rally across beaten-down software stocks on Thursday, including ServiceNow, Figma and Asana, signaling a shift in sentiment away from fears over AI disruption and renewed investor confidence in traditional SaaS durability and growth.

Cybersecurity firms also surged, with CrowdStrike (NASDAQ:CRWD) posting its best day on record and Okta (NASDAQ:OKTA) jumping roughly 22-29 percent after both companies beat earnings estimates on strong AI-security demand. The rally came the same day OpenAI and more than 100 other companies released an open letter warning that AI-driven cyberattacks are set to scale sharply in the coming months, adding to the sense of urgency around the sector.

Leading the S&P 500’s 11 sectors, the Information Technology group gained 3.4 percent as most other sectors declined.

Federal Reserve Chair Kevin Warsh used his first Jackson Hole address as chair to send a clearly hawkish signal on inflation, a message equity markets took in stride on Friday (August 28).

Speaking at the Jackson Hole Economic Policy Symposium, Warsh placed inflation responsibility "squarely" on the central bank after 65 months of sustained inflation. With the PCE price index at 3.7 percent year-over-year and 4.1 percent on a six-month basis—well above the 2 percent target—he set a high bar for policy changes, stating the Fed must be confident inflation is rapidly returning to target before shifting course. He rejected traditional forward guidance for encouraging market speculation over fundamentals and made no commitments on future rate paths.

The index-level reaction was mild. The S&P 500 dipped about 0.2 percent on the day, but finished the week 0.63 percent higher.

3 tech stocks moving markets this week

This week's top tech stock movers, according to TradingView data, were:

1. CrowdStrike (NASDAQ:CRWD)

CrowdStrike led gains with a 14.38 percent improvement.

2. Synopsys (NASDAQ: SNPS)

Synopsys saw a boost of 10.47 percent for the week.

3. Fortinet (NASDAQ:FTNT)

Fortinet saw a gain of 9.28 percent

Top tech news of the week

• Alibaba Group (NYSE:BABA) closed a major share placement to fund its AI investments on Wednesday, saying it would direct proceeds roughly 60 percent toward expanding global computing infrastructure and 40 percent toward building hyperscale AI data centers and upgrading cloud infrastructure.
  
  
• Archer Aviation (NYSE:ACHR) and AEG agreed to build downtown Los Angeles’ first vertiport at L.A. LIVE, making Archer the district’s exclusive air taxi partner ahead of the LA28 Games.
  
• As memory expenses continue to rise, Amazon (NASDAQ:AMZN) increased prices across its Echo, Fire TV, Kindle and eero product lines without issuing an official corporate announcement. Meanwhile, Apple (NASDAQ:AAPL) is reportedly preparing to raise iPhone prices following earlier price hikes on select devices this year. The company also announced the September 9 release date of the iPhone 18 Pro and Pro Max, iPhone Fold, Apple Watch Series 12 and Ultra 4 and AirPods 5.
  
  
• London-based data center developer Nscale aims to raise up to US$3 billion in a planned September US IPO, according to Bloomberg sources. Working with Goldman Sachs (NYSE:GS) and JPMorgan Chase (NYSE:JPM), the firm, which operates sites in Norway and West Virginia, has reported roughly US$51 billion in contracted revenue to prospective investors.
  
• Elon Musk said SpaceX (NASDAQ:SPXC) will launch its first orbital AI data center in the fourth quarter of 2027 using Nvidia technology and hit “significant scale” in 2028.
  
• SoftBank Group (TSE:9984,OTCPL:SFBQF) is planning a ¥1 trillion (US$6.3 billion) yen-denominated retail bond, with a seven-year maturity, pricing around September 4. A SoftBank spokeswoman described proceeds as being for “AI-related investments and to repay previously issued bonds”. Concurrently, SoftBank Corp is reportedly in ongoing discussions to purchase a controlling interest in humanoid robotics firm 1X Technologies, targeting a valuation near US$6 billion.
  
  
• Meta Platforms (NASDAQ:META) agreed to settle with US states for up to US$16.7 billion and agreed to enact new features on its platforms aimed at addressing risks to children. Meta also issued an open letter to TikTok and YouTube calling on them to join the deal.
  
• Nvidia is reportedly in talks to buy Hugging Face, the GitHub-like repository for open-source AI models, for US$12.9 billion, according to a person with knowledge of the agreement. Other reporting says Hugging Face had drawn interest from multiple bidders, including Salesforce, and that the talks remain unsigned; neither company has commented.
  
  Nvidia is also said to be discussing an equity investment in Perplexity that would value the AI search startup at more than US$30 billion. Separately, two individuals said their firms received price increase notifications of roughly 17 percent for Nvidia’s Grace Blackwell 300 and Vera Rubin 200 as memory chip costs surge.

• OpenAI, Anthropic, Amazon Web Services, Microsoft (NASDAQ:MSFT) and more than 100 other companies warned on Thursday there are only months to prepare for AI-enabled cyberattacks, with hospitals, water treatment plants and other critical infrastructure at risk as AI makes sophisticated cyber capabilities cheaper and more accessible. To adapt, the group outlines several key steps: organizations must raise security standards and fix key weaknesses, while tech and cybersecurity firms need to develop accessible AI defense tools. Additionally, governments should enhance threat intelligence sharing and boost funding, and frontier AI companies must step up by providing top models and hands-on support during major cyber incidents.

Major tech stocks report earnings

NVIDIA (NASDAQ:NVDA)

Nvidia surpassed Q2 revenue and profit estimates, prompting a rally in extended trading following an optimistic outlook for the upcoming year.

Nvidia’s total revenue came in at US$96.2 billion, up 18 percent from the prior quarter and up 106 percent year-over-year. Data Center revenue was US$89.0 billion (+18 percent Q/Q, +117 percent Y/Y), and Edge Computing came in at US$7.2 billion (+13 percent Q/Q, +27 percent Y/Y).

GAAP net income was US$59.7 billion. EPS was US$2.46, non-GAAP EPS $2.22. The company returned US$26.0 billion to shareholders in Q2 via buybacks and dividends, declared a US$0.25/share dividend payable October 1, 2026 and has US$99.0 billion left on its buyback authorization.

For Q3 FY2027, the company projects revenue to reach approximately US$108.0 billion, excluding China Data Center compute revenue, alongside an expected gross margin of 74.0 percent.

“AI has reached its inflection point. It's doing useful work. Its tokens are productive and profitable. Now, compute is revenue,” said CEO Jensen Huang.

Key announcements included full production of the Vera Rubin platform across major cloud providers, the new Vera CPU for AI agents, compute-financing partnerships mobilizing over US$500 billion with top financial firms, Blackwell dominating MLPerf Training 6.0 benchmarks and national AI infrastructure partnerships in Japan and Korea.

Salesforce (NYSE:CRM)

Q2 FY27 revenue was US$11.3 billion, up 11 percent year-over-year (11 percent in constant currency). Current Remaining Performance Obligation was US$33.5 billion. GAAP operating margin was 20.5 percent while operating cash flow was US$1.3 billion and free cash flow was US$1.1 billion for the quarter, with trailing-twelve-month free cash flow at US$15.2 billion. Capital return was US$0.4 billion.

Total Subscription & Support revenue was US$10.8 billion, with Agentforce Apps revenue at US$ 7.2 billion.

Agentforce & Data 360 ARR reached nearly US$3.9 billion, up over 210 percent Y/Y, including Informatica Cloud ARR. Agentforce ARR was US$1.5 billion and Data 360 ARR was US$2.4 billion. Agentic Work Units, defined as one discrete task completed by an AI agent, surged to 3.2 billion delivered in Q2, up 97 percent quarter-over-quarter. Slack AWUs grew 133 percent Q/Q, while human app usage “remained strong”, framed as agents expanding usage rather than cannibalizing it.

Full-year FY27 revenue guidance was raised to US$46.1 - US$46.4 billion, up from prior guidance of US$45.9 US$46.2 billion. EPS guidance raised to US$16.67 - US$16.71 For Q3 FY27, revenue guidance of US$11.42 - US$11.5 billion. Guidance explicitly included anticipated contributions from the Contentful and Fin acquisitions, which Salesforce expects to close “in the coming weeks”.

CrowdStrike (NASDAQ:CRWD)

Total revenue was US$1.47 billion, up 26 percent year-over-year from US$1.17 billion. Subscription revenue was US$1.40 billion, up 27 percent. Annual Recurring Revenue grew 25 percent year-over-year to US$5.84 billion as of July 31, with net new ARR of US$332.8 million added in the quarter, a company record, up 51 percent year-over-year.

GAAP net income came in at US$5.3 million. GAAP loss from operations was US$33.2 million. Subscription gross margin was 78 percent GAAP / 81 percent non-GAAP. Operating cash flow hit a Q2 record of US$530.3 million, and free cash flow was a record US$377.4 million. Cash and equivalents stood at US$5.01 billion as of quarter-end.

For Q3 FY2027, CrowdStrike guides to total revenue of US$1,523.2 - US$1,529.2 million and non-GAAP EPS of US$0.31. It raised full-year FY2027 guidance to total revenue of US$5,991.1 - US$6,011.1 million and raised its full-year net new ARR growth outlook by 630 basis points to 34 percent at the midpoint.

CEO George Kurtz called it “the best quarter in CrowdStrike's history.”

Tech ETF performance

Tech exchange-traded funds (ETFs) track baskets of major tech stocks, meaning their performance helps investors gauge the overall performance of the niches they cover.

This week, the iShares Semiconductor ETF (NASDAQ:SOXX) finished the week 0.67 percent lower, while the Invesco PHLX Semiconductor ETF (NASDAQ:SOXQ) advanced by 0.39 percent.

The VanEck Semiconductor ETF (NASDAQ:SMH) lost 0.08 percent.

Tech news to watch next week

Next week, investors will be watching for Canadian and US labour and inflation data for a read on the economy, alongside earnings from Dell Technologies (NYSE:DELL) and Palo Alto Networks (NASDAQ:PANW) on Tuesday (September 1) and Broadcom (NASDAQ:AVGO) and Snowflake (NYSE:SNOW) on Wednesday (September 2).

Also on Wednesday, the Bank of Canada rate decision lands, with a hold at 2.25 percent as the base case.