TBPN

Tech Earnings QuadKill

April 29, 2026

Happy Wednesday.

We’re live on YouTube and 𝕏.

The current thing in tech and business is today’s Alphabet, Microsoft, Amazon, and Meta earnings after market close.

Today’s lineup

True Anomaly Co-Founder & CEO Even Rogers at 11:50 AM
Caltech Physics Professor Dr. Maria Spiropulu at 12:00 PM
Squads Co-Founder & CEO Stepan Simkin at 12:35 PM
Hightouch Co-Founder & Co-CEO Kashish Gupta at 12:45 PM
Firestorm Co-Founder & CEO Dan Magy at 1:00 PM
Robinhood Co-Founder & CEO Vlad Tenev at 1:10 PM
Parallel Founder & CEO Parag Agrawal at 1:30 PM
Sequoia Partner Andrew Reed at 1:30 PM
Rogo Co-Founder & CEO Gabriel Stengel at 1:40 PM

Tech Earnings QuadKill

by John Coogan

Four earnings calls, one big question. How is the AI buildout going? SemiAnalysis expects upward revisions to capex guides. Financial performance has been strong across the board, even in “legacy” areas like search, ecommerce sales, and enterprise software seats. The bigger question is around durable revenue tied to AI infrastructure. Everyone has seen lots of cash flow to NVIDIA, power companies, and data center builders, but what does the exact conversion to higher revenues and profits look like?

Let’s start with Google, who had a great last quarter. Revenue up 18% for Q4. Search up 17%, YouTube ads up 9% and Cloud up 48% with operating income of $5.3B. Incredibly strong platform to build off of, and all of that is accelerating AI across the organization. The Gemini App continues to grow and direct customer API usage “exceeded 10 billion tokens per minute” - this all led to basically doubling capex year over year, with a 2026 target of $175B to $185B.

Google has a fully integrated AI stack. Consumer distribution, model training, custom chips, and product surfaces like search, YouTube, Android, and Cloud to deploy solutions across. The question investors are asking is: “Does AI change the unit economics of Search too quickly?” There are tons of places to pick up growth, especially in cloud, but the question is whether AI Overviews and Gemini are expanding search usage and ad ROI or compressing the model.

Microsoft is also coming off a strong quarter. Revenue up 17%, with cloud (which includes Azure, M365, etc.) growing 26%. Azure alone is growing even faster at 39% and is a bigger lever on capex (which is run rating around $150B). The biggest number in the Microsoft earnings is remaining performance obligations, listed at $625B last earnings, up 110%, with about 45% of that coming from OpenAI.

Microsoft gives the cleanest read on enterprise AI monetization. Azure growth, gross margins for Microsoft Cloud, Copilot adoption and ARPU, M365 seat growth, and GitHub Copilot momentum will all paint a picture of what’s happening with AI adoption in enterprises broadly. Copilots have not been the most hyped product, but strong growth numbers could reveal how nuanced the diffusion/adoption question really is. M365 seat growth should have impacts for the seat-based enterprise SaaS model.

For Amazon, everyone wants to see strong AWS acceleration to justify their Mag7-topping capex numbers. They guided to $200B in 2026 capex, so expect a lot of focus on AWS revenue growth and margin. Q4 was healthy overall though. Net sales up 14%, AWS growing 24%, the sneakily huge ads business grew 23% to $21.3B. Operating income overall was $25B for the quarter and they generated free cash flow of $11.2B, but this was down on increased AI spending.

If AWS accelerates, all the capex looks like buying scarce capacity ahead of demand. Consensus around AWS revenue is ~$36.7B, with growth in the mid-20s range, but the market is really hoping to see that AWS growth rate start with a 3 soon if the capex keeps growing.

Lastly, Meta. Super clean Q4, nothing really to prove. Despite all the FUD around the talent wars, the new team members, and sometimes clunky model releases, AI is already helping the core product, and that’s what matters for the financials. Revenue grew 24% to $59.9B for the quarter. They have 3.58 billion DAUs and grew the ad business a ton. Ad impressions rose 18% and average price per ad rose 6%. Family of Apps operating income was $30.8B, which really makes the $6B loss at Reality Labs look quaint. Capex was $72.2B for 2025 and the guide is $115B to $135B for 2026.

The question is how much more juice will AI bring to the ad business. Expectations imply revenue growth of around 31%, and the question is always the same - is there enough incremental growth to justify all the capex? The good news for Meta is that improvements in AI move the needle incredibly quickly. An AI advancement delivers better ad performance basically immediately, they don’t have to go and convince anyone to adopt a new product or change a workflow. There’s no “diffusion” question.

So, in summary, every company is trying to answer the same question: “Can you turn AI capex into proprietary distribution, higher customer retention, and measurable revenue growth before depreciation catches up?” Super Bowl for big tech. Get your popcorn ready.

Headlines

Bloomberg: 80 Seconds of Big Tech Earnings Will Decide Stock Market’s Fate

Bloomberg: IBM to Add 750 Jobs in AI, Quantum Computing at Chicago Tech Hub

Elon Musk set for major SpaceX payday — if he settles 1 million people on Mars

CNBC: Robinhood shares fall after earnings, revenue miss

FT: How OpenAI’s $500bn data centre venture Stargate has shifted shape

WSJ: Ex-Twitter CEO’s AI Startup Raises Funds at $2 Billion Valuation

WSJ: OpenAI Sued by Seven Families Over Mass Shooting Suspect’s ChatGPT Use

NBC: Inside Day 2 of the OpenAI trial: All eyes on Elon Musk

FT: Apple’s next chief John Ternus confronts break from China playbook

Washington Post: Company claims cloud-seeding breakthrough could help the parched West

NY Post: New Meta AI glasses help veteran ‘see’ the room around him