Big Tech's AI Spending and Earnings
Big tech companies, including Amazon, Alphabet, and Apple, have been heavily investing in artificial intelligence (AI), and this trend is expected to be a major theme in their upcoming earnings reports. Investors are closely watching these investments for clues on how AI will impact earnings. In the June quarter, these companies' stock reactions were driven by AI commentary and capital expenditure rather than traditional earnings and sales. For example, Alphabet needs to demonstrate how its Gen AI chatbot Gemini will generate revenue. Wall Street is particularly interested in Alphabet's search revenue and AI spending in its third-quarter earnings report.