Biggest Stock Movers Monday: U.S. Media Stocks, and More

The U.S. stock market on May 1, 2025, was a study in contrasts: tech optimism collided with tariff fears, while AI-driven growth and macroeconomic headwinds vied for investor attention. Media stocks like Meta and Reddit surged on strong earnings and strategic bets on artificial intelligence, while Apple and Amazon faced pressure from escalating trade tensions and weaker-than-expected guidance. Here’s what drove the volatility—and why it matters for investors.

Meta Platforms (META): Riding the AI Wave

Meta’s shares soared 4% during regular trading and spiked another 6% in after-hours activity, fueled by a stellar earnings report. The company reported that AI-driven content recommendations boosted user engagement by 6%–35% across its platforms, validating its massive investments in the technology. CEO Mark Zuckerberg emphasized that AI’s success had “reinforced our capital allocation priorities,” prompting Bank of America and JPMorgan to raise price targets to $690 and $675, respectively.

The takeaway: Meta’s AI pivot is paying off, but its long-term success hinges on executing its vision without alienating users or regulators.

Reddit (RDDT): A Social Media Bright Spot

Reddit’s stock surged nearly 20% in after-hours trading after it reported first-quarter revenue of $392 million—a 60% year-over-year jump that smashed analyst expectations. The platform’s ability to retain users and advertisers amid a slowing economy was underscored by its $420 million revenue outlook for Q2. CEO Steve Huffman framed the results as proof that Reddit’s “community-first” strategy is resilient to macro headwinds.

Reddit’s rise highlights a key theme: platforms that foster engaged communities—and monetize them effectively—can thrive even as broader ad spend falters.

Apple (AAPL): Tariffs Bite, but Growth Persists

Despite a 4% after-hours drop, Apple’s first-quarter results were strong: $95.4 billion in revenue and $24.78 billion in net income beat estimates, driven by iPhone sales and services. However, CEO Tim Cook’s warning that tariffs would add $900 million in costs this quarter spooked investors. Apple’s plan to shift U.S.-sold iPhone production to India by 2026 underscores the urgency of mitigating trade risks—a move that could take years to fully implement.

Investors are now weighing Apple’s short-term tariff pain against its long-term dominance in high-margin services and hardware.

Amazon (AMZN): Cloud Wins, but Guidance Misses

Amazon’s shares dipped over 2% after hours despite a strong earnings beat. First-quarter revenue hit $155.7 billion, fueled by AWS’s 23% cloud revenue growth. But the $13–$17.5 billion operating income guidance for Q2 fell short of expectations, amplifying concerns about margin pressure and tariff exposure. With 18% of its products imported from China and 60% of third-party sellers having China ties, Amazon is particularly vulnerable to trade policy shifts.

The takeaway: Amazon’s growth machine remains intact, but its reliance on Chinese supply chains and ad revenue makes it a prime target for tariff-related volatility.

The Broader Picture: AI vs. Tariffs

The May 1 market moves reflect a broader tension: AI-driven optimism is clashing with macroeconomic drag. The U.S. economy contracted by 0.3% in Q1 2025—the first quarterly decline in three years—amid elevated inflation (PCE at 3.6%) and weak consumer spending.

Meanwhile, AI stocks like NVIDIA and cloud infrastructure providers Vistra and Constellation Energy rose on Meta’s success, reigniting investor enthusiasm for the sector. Yet trade policy remains a wildcard: companies like Becton Dickinson and Qualcomm have already cut guidance due to potential tariff impacts.

Conclusion: Navigating the Crossroads

On May 1, investors faced a clear choice: bet on AI’s long-term promise or brace for tariffs’ near-term pain. Meta and Reddit’s gains highlight the rewards of innovation and community-building, while Apple and Amazon’s struggles underscore the risks of global supply chains and trade wars.

The data tells a stark story:
- Meta’s AI-driven user engagement gains (6%–35%) signal a strategic win.
- Apple’s $900 million tariff hit underscores the financial stakes of geopolitical tensions.
- Reddit’s 60% revenue growth proves that niche platforms can outperform during downturns.

For investors, the path forward requires balancing these forces. Focus on companies with diverse revenue streams, local supply chain flexibility, and AI-driven growth catalysts—while staying vigilant about trade policy risks. The market’s volatility isn’t just noise; it’s a warning that the next era of tech growth will belong to those who master both innovation and resilience.