Big Tech delivers the loudest earnings week of the year

Wall Street ended the week with the question it had been asking for a month finally answered, and another one immediately taking its place. Mega-cap technology earnings carried the market through a stretch loaded with macro pressure — an ongoing war, oil near recent war-driven highs, and the Federal Reserve leaving rates on hold again — and delivered enough to push major US benchmarks to fresh records. The unresolved part is what comes next, because the price of those beats is a capital spending bill that keeps growing.

What the Mag 7 actually delivered

Five mega-cap names reported inside 48 hours, and each came in ahead of consensus on the metric the market was watching most closely.

Microsoft posted fiscal third-quarter revenue of $82.9 billion against expectations near $81.3 billion, with earnings of $4.27 per share and revenue growth of 18%. Azure and other cloud services grew 40% year-on-year, or 39% in constant currency, accelerating from prior quarters. The company also signalled that capital expenditure will rise further in the year ahead as it continues to build out AI infrastructure capacity.

Alphabet reported revenue of $109.9 billion against expectations near $107.2 billion, with Google Cloud the standout. Cloud revenue rose 63% to $20 billion, and management pointed to a Cloud segment backlog now running in the hundreds of billions of dollars. Alphabet raised its 2026 capital expenditure outlook to as much as $190 billion. Search revenue grew at a high-teens pace.

Meta delivered the fastest revenue growth since 2021, with first-quarter sales of $56.3 billion against expectations near $55.5 billion, up 33% year-on-year. Advertising velocity strengthened on both volume and pricing. Management flagged that internet disruptions in Iran and access restrictions on WhatsApp weighed on user metrics during the quarter — a relatively rare direct connection between the Middle East war and a mega-cap's reported fundamentals.

Amazon reported revenue of $181.5 billion against expectations near $177.3 billion. AWS grew 28% to $37.6 billion, the segment's fastest growth in roughly 15 quarters. Advertising revenue rose 24% to around $17.2 billion.

Apple closed the week. Fiscal second-quarter revenue of $111.2 billion topped consensus near $109.7 billion, services revenue hit a record near $31 billion, and Greater China sales rose 28%. Shares climbed roughly 3% on Friday, helping the Nasdaq close at a fresh record of 25,114 — its first close above 25,000 — and the broad US benchmark settle at a record 7,230.

The capex bill keeps growing

The pattern across the group was clear: cloud and advertising revenue accelerated, AI workloads continued to scale, and the spending required to deliver them got larger. Alphabet's $190 billion 2026 capex guide was the most explicit signal, with Microsoft and Amazon both pointing to record infrastructure investment alongside their results. Combined hyperscaler outlays look set to run well into the hundreds of billions of dollars across the group this year.

Markets rewarded names where AI revenue is visibly catching up to AI spending. Where monetisation looked further out, share price reactions were sharper. The asymmetry traders are now pricing is straightforward. As long as cloud bookings, AI-linked services and advertising volumes keep absorbing the spend, the multiples on the group can stretch further. If any of those revenue streams soften while capex commitments stay locked in, the operating leverage that has powered the group reverses quickly.

What May opens with

The earnings calendar does not let up. Palantir, Advanced Micro Devices and Arm Holdings are scheduled to report next week, keeping the AI infrastructure narrative directly in front of traders. Several strategists suggest these names matter more for the rotation question than the headline question — whether the rally can broaden beyond the largest hyperscalers into the chip designers, software platforms and infrastructure suppliers riding the same capex wave.

Friday also delivered a fresh oil headline. WTI crude eased around 2–3% on reports that Iran had sent a peace proposal through Pakistani mediators, although a naval blockade of Iranian ports announced earlier in the standoff by the US administration remains in place and Brent stayed elevated for the week. Next week brings the April US jobs report, ISM manufacturing data and a wave of Federal Reserve speeches. Each carries the potential to shift rate expectations, which for now have largely settled into a hold-through-2027 base case among many traders.

For mega-cap technology, the immediate hurdle has been cleared. The harder question — whether AI monetisation can keep pace with a spending bill that gets larger every quarter — is the one the next earnings cycle will be asked to answer. For now, the group has bought itself another quarter of benefit of the doubt.

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