$Microsoft(MSFT.US)$Meta Platforms(META.US) seems to have figured it out. The AI sector is now entering a winner-takes-all phase. The winner, Microsoft, has successfully achieved profitability and started a virtuous cycle, while the loser, Meta, is selling off data centers but still can't preserve its cash flow. The winner shifts from increasing investment in expanding data centers to acquiring and leasing the loser's computing power at low prices, significantly cutting future expenses; meanwhile, the loser has no choice but to sell off computing power at a loss to exit the market and keep their cash flow from breaking.

The most bizarre part is that Microsoft announced cost cuts, yet the "shovel sellers" collectively surged. This indicates that the recent plunge in semiconductors stems from Wall Street's concerns about a bubble. Microsoft's profit followed by spending cuts, this behavior of "coming to the table to eat meat," proves to them that there is fundamentally no bubble. Unlike Google, which faced stock price pressure after reporting profits but significantly increasing expenses, Microsoft is currently surging. This proves that what Wall Street currently wants to see is hardware companies and software companies rising and falling together; the July plunge in hardware stocks actually originated from the June plunge in software stocks. Now we can only hope all AI leaders stand tall, share the gains, rather than mocking those standing barefoot when software drops, or mocking them for value destruction when hardware drops.