U.S. equity futures pointed to an uneven start on Friday, as investors digested a mix of corporate earnings, executive news and lingering questions around the cost of artificial intelligence investment. Broadcom (NASDAQ:AVGO) shares retreated in late trading after the chipmaker warned that its expanding AI business would pressure margins. Costco (NASDAQ:COST) delivered better-than-expected quarterly results, underscoring resilient demand for value-focused retail as shoppers remain cautious ahead of the holiday season. Meanwhile, Lululemon Athletica (NASDAQ:LULU) said its chief executive will step down, amid reports that the company’s founder is considering a potential proxy challenge. Oil prices moved higher on supply concerns linked to possible U.S. action against Venezuelan crude shipments.
Futures point to a muted open
U.S. stock futures hovered near flat early Friday, suggesting a subdued end to a week shaped by central bank decisions and closely watched developments in the artificial intelligence sector.
At around 02:00 ET, Dow Jones futures were up 105 points, or 0.2%, S&P 500 futures were little changed, and Nasdaq 100 futures slipped 36 points, or 0.1%.
Wall Street closed at fresh record highs on Thursday, with both the S&P 500 and the Dow Jones Industrial Average lifted by a Federal Reserve decision that investors viewed as more balanced than expected. Market strategists at Vital Knowledge said Fed Chair Jerome Powell effectively gave a “green light” for a year-end rally in equities.
That optimism was partly offset by a downbeat outlook from Oracle, which intensified concerns over whether heavy spending on artificial intelligence will translate into durable profits. Oracle’s shares sank more than 10%, while its bonds were sold off and demand rose for credit default swaps, highlighting anxiety over debt-funded AI expansion.
The negative reaction weighed on the tech-heavy Nasdaq Composite, which fell 60.30 points, or 0.25%.
Broadcom flags margin pressure
Broadcom shares slid in extended trading after the semiconductor group cautioned that margins will decline as AI-related revenue dilutes profitability.
As the company seeks to challenge Nvidia’s dominance in AI processors, it has ramped up investment in the space. Chief executive Hock Tan told analysts that Broadcom’s order backlog has reached $73 billion, with deliveries expected over the next 18 months.
However, the scale of investment required is substantial. Chief financial officer Kirsten Spears said first-quarter consolidated gross margins are expected to fall by around 100 basis points from the previous quarter.
Industry-wide, major U.S. cloud providers are projected to spend more than $400 billion on AI this year, largely on data centre infrastructure needed to support models such as OpenAI’s ChatGPT and Google’s Gemini.
With little evidence so far that these investments are generating meaningful productivity or earnings gains — combined with elevated valuations and a wave of dealmaking — some investors are warning of bubble-like dynamics in the AI sector.
Broadcom’s fiscal fourth-quarter results, which beat expectations, marked one of the final major AI-related earnings reports of 2025. Attention now turns to upcoming results from Apple supplier Jabil and memory-chip maker Micron later this month.
Costco outperforms
Elsewhere, Costco shares dipped slightly in after-hours trading, despite the wholesale retailer reporting fiscal first-quarter revenue and profit that exceeded market estimates.
Comparable sales excluding fuel rose 6.4% in the quarter ended November 23, topping expectations for a 5.82% increase, according to LSEG data cited by Reuters.
Results were also supported by Costco’s same-day delivery partnerships with Instacart in the U.S. and UberEats and DoorDash internationally.
The performance mirrors strength seen at rivals such as Walmart, Dollar Tree and Dollar General, reinforcing the view that many consumers — particularly in the U.S. — are increasingly seeking value amid economic uncertainty, a cooling labour market and stubbornly high inflation.
Lululemon CEO to step aside
Lululemon Athletica shares surged more than 10% in late trading after the company announced that CEO Calvin McDonald will leave his role and raised its full-year profit outlook.
McDonald is set to depart in January after seven years at the helm, with no immediate successor named. He will remain in a senior advisory role through March but will step down from the board.
The Wall Street Journal reported that McDonald’s exit comes as founder Chip Wilson has been privately exploring a possible proxy fight, holding talks with investors and advisers. Wilson is said to be dissatisfied with elements of Lululemon’s marketing strategy, though it remains unclear whether the leadership change will alter his plans.
Oil prices edge higher
Crude prices advanced on Friday, supported by supply concerns after reports suggested the U.S. could intercept additional Venezuelan oil shipments.
Brent crude futures rose 0.5% to $61.56 a barrel, while U.S. West Texas Intermediate gained 0.5% to $57.90 a barrel.
Despite the gains, both benchmarks were on track for weekly declines after sliding around 1.5% on Thursday, amid speculation that a potential peace agreement between Russia and Ukraine could boost Russian oil exports to global markets.
