Big Tech Divorce: Are You Team GOOG/AMZN or Team META/MSFT?
$Alphabet(GOOG)$ and $Amazon.com(AMZN)$ rallied after-hours. $Microsoft(MSFT)$ dropped -2%, $Meta Platforms, Inc.(META)$ loses 9%. Four companies combined committed up to $725B in 2026 CapEx — more aggressive than the market expected.
📊 Scorecard: Actual vs. Estimates
1. $Alphabet(GOOG)$ blowout earnings! All beats and increases dividends.
On April 27, the board of directors approved a 5% increase in the quarterly cash dividend to $0.22 per share, which will be distributed on June 15, 2026, to all shareholders of record across all share classes.
- Revenue: $109.9B (+19% YoY ex-FX), beat consensus +3%
- Google Cloud: $20.0B, +63.4% YoY → accelerated from +48% last quarter
Despite a significant expansion in investment scale, the company still generated $45.8 billion in operating cash flow in the first quarter, with free cash flow of approximately $10.1 billion.
2. $Amazon.com(AMZN)$ divergence after hours, but AWS comforts the market
- Revenue: $181.5B (+17% YoY), beat Street +2.4% (above guidance high end)
- AWS: $37.6B (+28% YoY), AWS Op Margin 37.7%
- Q2 Revenue guidance: $194-199B vs. Street $188.9B → midpoint +3% above
3. $Microsoft(MSFT)$ drops -2% due to uncertainty on Q4 Azure guidance window
- Revenue: $82.9B (+18% YoY), beat +2%
- Azure: +40% YoY (cc +39%) vs. guidance 37.5%
- EPS: $4.27 vs. est $4.07 → +5%
Total AI revenue $37B+, +123% YoY; Copilot paid seats topped 20M (from 15M last quarter)
4. $Meta Platforms, Inc.(META)$ loses 9%, earnings in-line, capEx raised by +$10B
- Revenue: $56.38B vs. est $56.3B → +0.4%, in-line
- Ad Revenue: $55.6B (+28.7% YoY ex-FX)
- Family DAPs: 3.56B (+4% YoY), -2% below estimates
- Q2 Revenue guidance: $58-61B (in-line with consensus)
How do banks view post-earnings?
- Citi on $GOOG$ (Buy, PT $405): Cloud reacceleration is the headline. TPU + Gemini demand driving upside. PT based on 29x 2027E GAAP EPS of $13.92 — premium justified by Cloud trajectory.
- GS on $AMZN$ (Buy, PT $275): Across-the-board beat. Q2 guidance high end above consensus. Awaiting AWS revenue backlog disclosure in the 10-Q to fully size the AI demand pipeline.
- GS on $MSFT$ (Buy, PT $600): Azure +40% is solid, but the -2% AH reaction reflects Q4 guidance uncertainty. Watch for Fairwater facility capacity ramp commentary and Azure growth trajectory over the next 4 quarters.
- Citi on $META$ (Buy, PT $850): Ad growth + CapEx raise in the same report underscores AI monetization confidence. Next catalysts: Muse Spark, agentic commerce, Business AI Agent.
Is this the strongest single-quarter signal yet for $SanDisk Corp.(SNDK)$ and $Seagate Technology PLC(STX)$ ?
How do you view GOOG's super earnings again?
Is Meta a buy after earnings dip? Or time to exit?
Are you bullish on Amazon aws acceleration?
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For $Alphabet(GOOGL)$ , I see this as a durable, high-quality beat. Cloud growth at 63% shows real AI monetization, and strong cash flow despite higher CapEx removes margin concerns. I’m comfortable assigning a premium multiple here.
On $Meta Platforms, Inc.(META)$ , I’m not exiting — the drop looks like sentiment-driven, not fundamental. I’d lean toward buying weakness. Meanwhile, I stay bullish on $Amazon.com(AMZN)$ , as AWS acceleration and margins confirm one of the strongest AI monetization stories right now.
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They made the rights moves with the available resources, while microsoft felt like they kept trying to force changes with the success they had from investing in openai and having the first mover's advantage.
Microsoft failed to understand that they should have branched out organically, instead of trying to force feed new functionalities down the throats of existing users who were happy to varying degrees with the status quo. By making hasty moves, and not listening to feedback, they lost ground to others who were later to the game. Hopefully someone is there to steer things the right way, before it is too late.
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