Lessons that earnings season taught me
I love the smell of earnings season. It's a quarterly checkup. It's that one time of the year -- OK, technically, one of four times during the year -- in which a company really lets us know what it's capable of achieving.

I learned a lot this past trading week.

  • I learned that stodgy old Microsoft (NASDAQ:MSFT) can still be a nimble speedster. Sales and earnings per share shot up 27% and 29%, respectively, during the quarter, as the company scored with Vista and Halo 3.
  • I learned that Baidu.com (NASDAQ:BIDU) hasn't lost its racing stripes. Sales and earnings soared 108% and 113% higher, respectively. China's leading search engine keeps topping expectations. Do you really have to wonder why the shares have quadrupled since being recommended to Rule Breakers subscribers a year ago?
  • I learned that Apple (NASDAQ:AAPL) is still immortal. The company blew past analyst expectations, the way it has in each of the past 19 quarters.

Add it up, and you'll see that the tech bellwethers are ringing in just nicely. Sure, the market is nervous. Lenders and investment bankers are taking massive hits on the subprime fiasco. Homebuilders keep finding bigger holes in their roofs. However, deep in the heart of tech stocks, it's been business as usual.

On the lighter side ...
And now, let's take a quick look at some of the other stories that shaped our week.

  • Microsoft invested $240 million in Facebook, to value the rapidly growing social-networking site at a whopping $15 billion. There is more to this move than meets the "yikes," though. Microsoft is also broadening its ad deal to serve its paid-search ads on Facebook worldwide. Last year's deal just covered stateside impressions. So let's not rush to assume that even Mr. Softy believes Facebook is worth $15 billion. "$240 million isn't an investment," I wrote. "It's a cover charge." 
  • General Electric's (NYSE:GE) NBC pulled its channel from Google's (NASDAQ:GOOG) YouTube. Dumb move. NBC was getting free advertising by loading the site with promotional clips of its shows. That's like insulting the person who's handing out free samples at the shopping mall's food court.   
  • XM (NASDAQ:XMSR) was one of the few companies to post disappointing quarterly results. Losses widened. Subscriber-acquisition costs inched higher. It lost more subscribers at the retail level than it gained -- though that was more than offset by a surge on the automaker side. I almost feel like tuning in to XM's hit show -- Bob Dylan's Theme Time Radio Hour -- to see whether he's going with heartbreak tunes. Boy, XM seriously needs Sirius (NASDAQ:SIRI).

Until next week, I remain,

Rick Munarriz

Baidu.com is a Rule Breakers newsletter recommendation. Microsoft is an Inside Value stock pick. If this weekend finds you hungry for stock picks, snag a 30-day trial subscription offer to either newsletter service.

Longtime Fool contributor Rick Munarriz recommends windshield wiper fluid when trying to look back. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. He does not own shares in any of the companies in this story. The Fool has a disclosure policy.