Alphabet (GOOG) is leading. Google Cloud exploded +63% year-over-year to $20B in Q1, with operating margins near 33% and a backlog that nearly doubled to over $460B. Shares surged post-earnings, silencing doubts about Google’s AI position as heavy capex ($180-190B guided) starts delivering high-margin growth.
Amazon (AMZN): AWS grew ~28% (fastest in 15 quarters) and delivered a strong operating income beat. Solid returns on ~$200B capex.
Meta (META): Strong ad revenue (+28-33%), but shares fell on higher capex guidance ($125-145B) as AI monetization remains more indirect.
Microsoft (MSFT): Azure growing well (~40%), yet the stock has lagged peers amid massive ~$190B spending and questions on return timing.
Apple continues with low capex intensity and strong services margins.Bottom Line: Among the big AI spenders, Alphabet currently shows the best bang for the buck
Amazon Q1: AWS 4Y Growth High, But Capex Concerns Loom?
Amazon (AMZN) edged up just 0.77% today despite Q1 results showing AWS revenue grew 28% year-over-year — its fastest single-quarter growth rate in nearly four years — corroborating alongside Google Cloud the certainty of hyperscaler AI compute demand. Analysts noted that both companies' cloud growth trajectories provide clear near-term demand visibility for chip suppliers including Nvidia. The AWS acceleration story is now well established, but when will elevated AI capital expenditure translate into visible margin improvement?
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