What's going on?

Two of the most popular US stocks might�ve peaked too early: software giant Oracle and kids� gaming platform Roblox reported disappointing updates earlier this week.

What does this mean?

Senior tech specialist Oracle actually turned in surprisingly strong quarterly revenue and profit figures. But the company�s forecast for this quarter fell short: it�s expecting to post a lower profit than previously predicted as it ups investment in its priority cloud computing segment.

Newly listed Roblox, meanwhile, followed up a mouth-watering debut earnings report last month with news that May only saw 43 million daily active users. That was 28% higher than this time last year, sure, but it was lower than April�s 43.3 million total � and user spending on preteens� go-to gaming hub was slightly less than a year ago too.

Why should I care?

For markets: Time to reset some assumptions.

Both stocks initially fell on Wednesday: Oracle by 5% and Roblox by 10%. In Oracle�s case, investors might�ve seen its spending plans as throwing good money after bad, especially since the firm is sacrificing short-term profit. As for Roblox, the combination of lower user figures and lower spending may have negative consequences for the company�s path to profitability. In both cases, investors� newly adjusted earnings expectations might be why they sold off their shares.

The bigger picture: Don�t believe the homecoming hype.

Oracle�s investors may have got overexcited about its cloud computing prospects. While global cloud revenue is expected to rise 23% this year, most of that will likely be snatched up by rivals Amazon, Alphabet, and Microsoft (tweet this). Roblox�s backers may likewise have bought into the idea that pandemic-driven growth will keep going, and that kids will stay indoors even if they�re able to leave. But last month�s data suggests that, as the Western world reopens, adults and children alike are reembracing real-life interaction.