New York, Jan 31, 2026, 13:46 EST — Market closed.
Telecom stocks pushed communication services higher to close out the week, lifting the Communication Services Select Sector SPDR Fund roughly 0.3% to $120.08 on Friday. Verizon surged 11.8% to $44.52, while AT&T and T-Mobile US climbed 4.3% and 4.2%, respectively. Meta Platforms, however, dropped nearly 3%.
The group now serves as a live experiment in two conflicting investor bets: wireless subscriber churn and pricing, versus soaring hardware costs for AI at major platforms. Upcoming earnings guidance will reveal if cash returns and spending plans can both hold steady.
XLC follows the Communication Services Select Sector Index, combining telecom firms with media, entertainment, and interactive services. This mix means the ETF can swing on anything from a major carrier’s promotion to changes in advertising market sentiment. (State Street Global Advisors)
Verizon led the way after projecting annual profit and free cash flow—cash remaining after capital spending—above expectations. It also launched a new share buyback program, authorizing up to $25 billion over three years, marking its first such move in nearly six years. The carrier credited aggressive holiday deals, like four phone lines for $100 a month, for adding 616,000 monthly bill-paying phone subscribers in the fourth quarter. It expects to add between 750,000 and 1 million retail postpaid phone customers in 2026. Dan Schulman told analysts, “Verizon will no longer be a hunting ground for our competitors,” while MoffettNathanson noted the Frontier Communications acquisition has expanded Verizon’s fiber network to nearly match AT&T’s. (Reuters)
Charter Communications finished Friday up around 7.6% after reporting a smaller-than-anticipated drop in broadband subscribers. The company lost 119,000 internet customers last quarter, shy of the roughly 132,000 expected. Vikash Harlalka at New Street Research commented, “We think it will be a while before we see a major improvement in Charter’s broadband subscriber trends.” Chris Winfrey added, “In 2026, we’ll nearly complete our rural build-out,” which should add more than 1.7 million new subsidized rural passings. (Reuters)
Meta’s stock retreated after two days of digesting its hefty AI-related spending surge. The company upped its capital expenditure forecast by 73%, now expecting to spend between $115 billion and $135 billion in 2026. Most of that will go toward data centers and cloud infrastructure, all in pursuit of what it terms “superintelligence.” Mark Zuckerberg told analysts, “This is going to be a big year for delivering personal superintelligence,” while Susan Li warned that capacity constraints could persist through much of 2026. (Reuters)
The S&P 500 dipped 0.43% on Friday as investors digested Donald Trump’s new nomination for Federal Reserve chair, earnings updates, and a producer price report tied to inflation. Tech stocks with high multiples faced selling pressure despite some beating earnings forecasts. (Reuters)
Next week could get complicated for the sector. Telecom investors are questioning if subscriber growth came at too high a cost, while media and platforms face fresh doubts over ad demand. Even a slight change in the tone around capital spending could overshadow the usual dividend and buyback narrative.
Expectations remain sky-high. “For those companies where expectations have become very, very lofty, the onus is going to be on them to deliver,” said Jim Baird of Plante Moran Financial Advisors. Sid Vaidya at TD Wealth noted investors see little chance of AI-related capital spending slowing down. He also pointed to the Feb 6 U.S. jobs report as a key rates test, coming after the Fed paused its rate-cut cycle. (Reuters)
Markets reopen Monday with Disney leading off on the media front. The company will report earnings before the open and hold a webcast at 8:30 a.m. ET. Alphabet plans to release its quarterly numbers and host an earnings call after the close on Feb. 4, followed by Amazon.com on Feb. 5. (Business Wire)
