2025 Predictions for Apple, Microsoft, Tesla, and other tech leaders
The Magnificent Seven group of leading tech companies: Apple, Nvidia, Microsoft, Amazon, Alphabet, Meta and Tesla, gained a combined 63 per cent in 2024, building on 2023’s strong performance.
Deutsche Bank revealed the group generated more profit in 2024 than most national stock markets.
However, JP Morgan has projected their contribution to S&P 500 earnings growth will decline from 75 to 33 per cent in the next year, signalling challenges ahead.
Will the group continue its market dominance this year? Here’s a breakdown of their 2025 prospects:
Big tech’s outlook for 2025
For Apple, the well-loved brand fuelled strong sales in 2024, with its privacy features and ecosystem keeping customers loyal.
However, service growth missed expectations, and its innovation in hardware appeared muted.
According to Susannah Streeter, head of money and markets at Hargreaves Lansdown, the company’s focus on AI could help the company change direction in 2025.
After five per cent cumulative revenue growth over the past three years, the consensus is for seven per cent growth in 2025, so expectations remain high.
Yet, its stock has risen 41 per cent over the past three years, underperforming the 51 per cent increase in the information technology index.
Microsoft , on the other hand, solidified its position at the centre of the AI revolution in 2024, with Azure revenue up 34 per cent, according to Streeter.
It’s integration of AI tools like Copilot across its software suite impressed analysts.
In the next year, competition in cloud computing and regulatory scrutiny could test its ability to maintain momentum, yet the end of Windows 10 support may drive an upgrade cycle, says AlphaOne Capital Partners founder, Dan Niles.
He recently wrote on LinkedIn that the end of Windows 10 “could also lead to some upgrades in their core PC business while a ramp in AI PC demand is a hope for some point in the future”.
Amazon’s Cloud AWS continued to lead its growth in 2024, posting 19 per cent revenue increases as AI adoption surged worldwide.
Meanwhile, e-commerce margins rebounded after the firm’s cost-cutting measures. According to Streeter, “margins have recovered after the huge cost-saving drive with worldwide layoffs.”
Amazon could prove to be the group which fares the best for 2025, having beaten both revenues and margins in the most recent quarter.
Nile acknowledged uncertain customer spending trends in 2025, which may yield a rough start due to fewer shopping days and, unfortunately, placed holiday days.
Meta’s cost-cutting pays off
For Meta, the tech giant’s strategic slim-down saw a positive payoff in 2024, with daily active users growing five per cent.
Meanwhile, its AI investment enhanced ad targeting and content recommendations, driving advertiser confidence.
However, 2025 will be a test of whether Meta can sustain growth without the tailwinds of an election or major events such as the Olympics, which partly boosted customer engagement in 2024.
“If its revenue doesn’t keep up”, said Streeter, “margins may come under pressure, deterring its investors”.
Alphabet, Google’s parent company, also saw strong results in 2024, bolstered by its cloud business and AI developments.
However, the US Department of Justice’s case against Google’s search monopoly casts a shadow over the firm’s 2025 outlook.
Chief executive Sundar Pichai emphasised the importance of leveraging AI as a means to move faster and solve real-world problems.
The firm made headlines towards the end of 2024, as Pichai geared his employees for an important, “pivotal” year ahead, whilst also warning them of potential challenges.
Tesla starts to lose steam
Tesla rode a wave of optimism in 2024, its stock surging 63 per cent partially due to Elon Musk’s advisory role in the Trump administration.
However, declining EV demand and the potential loss of tax credits in 2025 could hit the company’s sales.
Tesla‘s ability to scale production of its affordable electric vehicles and expand self-driving capabilities will, therefore, be critical for 2025.
Nvidia largely led the Magnificent seven group in 2024, dethroning Apple as the world’s most valuable company with its shares up 171 per cent amid surging AI demand.
The firm’s sales and earnings boomed despite taking a slight hit at the end of 2024, according to Investopedia.
Yet, it’s Blackwell super chip and dominance in AI infrastructure positioned for continued growth in 2025.
However, supply constraints and the potential for an AI “digestion phase” mid year, Dan Niles noted, could temper expectations.