This week is crucial for Big Tech earnings, with major players Apple (AAPL), Amazon (AMZN), Microsoft (MSFT), and Meta (META) set to report their quarterly results. The recent Alphabet report, Google’s parent company, has provided valuable insights into the performance of these tech giants.
Alphabet’s solid results on Thursday boosted Google stock and Wall Street’s hopes that the impact of the Trump tariff turmoil may not be as severe as expected, particularly for fellow ‘Magnificent Seven’ companies Amazon, Microsoft, Meta, and Apple. According to Ray Wang, analyst at Constellation Research, “Google is a good barometer for the other four Mag 7 earnings.” The challenge lies in the Q2 forecast and what to expect.
The Google report helped ease investor worries about Big Tech, with Bernstein analyst Mark Shmulik noting that Google’s results underscored “a healthy dose of strong fundamental performance.” Two key areas where Google provided upbeat signals were digital ad spending and artificial intelligence (AI). Digital ad spending appeared to be going strong, which is good news for Meta and Amazon, both of which are set to report their earnings this week.
Google’s comments on its cloud revenue growth were also “encouraging,” according to Wedbush analyst Daniel Ives, as they pointed to how Google’s “more aggressive pace of investment should alleviate capacity constraints as AI demand continues to scale.” Ives cited conversations with “dozens” of major tech executives and decision-makers that confirmed AI’s momentum, with firm CapEx intentions for 2025 as the AI Revolution accelerates.
Apple reports its quarterly results on Thursday, with Wall Street focused on what the iPhone maker says about how tariffs have impacted its business. While Apple management “did not call out any signs of a softening ad backdrop through April,” according to Ives, the company “may get a bump from pre-tariff purchases,” as noted by Wang.
The earnings reports from these Big Tech companies will provide valuable insights into the impact of the trade war with China and the ongoing AI Revolution. As Wang argued, “CapEx spending isn’t going to slow down for AI investments.”
