80 Seconds of big tech earnings will decide stock market’s fate

Investors looking for clues on which direction the stock market is headed in the coming weeks will get a rapid-fire reading as soon as trading ends on Wednesday.

Four of the biggest companies in the US — Alphabet, Amazon.com, Meta Platforms and Microsoft – are due to report earnings after the bell. And if they hit at the same time they did last quarter, it will all play out in just 80 seconds.

“I can’t remember a time where you had this many names in one shot,” said Michael O’Rourke, chief market strategist at Jonestrading. “It’s going to be hectic.”

What the numbers reveal will have far-reaching implications. The companies are part of the Magnificent Seven tech behemoths, along with Nvidia Corp., Apple Inc. and Tesla Inc., that have pushed the S&P 500 Index to record after record in the past few weeks and put it on pace for its best month since November 2020. They’re also the four biggest spenders on artificial intelligence computing infrastructure, which has made chipmakers and memory storage device manufacturers the hottest trades on Wall Street.

Details on those capital expenditures and revenue growth from AI will be top of mind for traders, prioritised over numbers from core businesses such as e-commerce, digital advertising and software. The reason is that the big outlays have become a double-edged sword in the tech universe.

On one hand, an entire ecosystem of suppliers hinges on Big Tech’s continued largess. The Philadelphia semiconductor index has surged soared 32% in April on the strength of an 18-session winning streak, putting it on track for its best month since February 2000. Meanwhile, semiconductor and storage-related companies account for the 11 best-performing stocks in the technology-heavy Nasdaq 100 Index this year. And it’s all tied to ballooning revenues from AI capex.

On the other hand, shareholders are concerned about the vast amounts being spent and when the companies will see bigger payoffs from the investments. ChatGPT-owner OpenAI reportedly missed internal targets for new users and revenue, according to a story in the Wall Street Journal, raising concerns about its ability to meet massive infrastructure funding commitments. The Philadelphia semiconductor index tumbled 3.6%, its worst day in a month.

“If capex is paired with positive revenue, measurable revenue, and outlooks that show that earnings and revenue are being guided higher, then I think increased capex will be OK for the stocks,” said Anthony Saglimbene, chief market strategist at Ameriprise. “But if we see any slippage on the outlooks, that will lead to more volatility and pressure the S&P 500.”

Here’s a look at expectations for each company:

Microsoft

The software giant’s shares are coming off their worst quarter since 2008, and their 11% drop this year makes them the weakest performers among the seven most valuable companies in the S&P 500. Microsoft and the broader software industry has been under pressure for some time due to concerns about disruption from AI, even though the maker of Excel and Word is investing heavily to beef up computing power for the technology.

Focus will be on its Azure cloud-computing business, where disappointing revenue growth in Microsoft’s fiscal second quarter sent the stock tumbling 10% on Jan. 29, the day after the last earnings report, wiping out $357 billion in value, the second most for a single session in stock market history.

In Microsoft’s fiscal third quarter, revenue growth for the unit is expected to be 38%, according to the average analyst estimate compiled by Bloomberg. The company hasn’t given a capital spending forecast for fiscal 2027, but Wall Street is expecting roughly $176 billion including leases, according to data compiled by Bloomberg. To offset that spending, Microsoft is reportedly offering voluntary buyouts to about 7% of its US workforce.

Alphabet

The Google parent’s stock price is up 12% in 2026 as investors become increasingly optimistic about its position in the AI landscape. Alphabet’s tensor processing unit chips, or TPUs, are gaining traction as a key alternative Nvidia’s graphics processing units. In recent weeks, the company has secured deals with startups including Anthropic to provide computing power.

Alphabet is projected to post first-quarter net income of almost $32 billion, down 8% from a year ago, on revenue of roughly $92 billion, which would represent a 20% increase. Google Cloud revenue is projected to rise 50% to $18.4 billion from a year ago, compared with a 48% gain in the fourth quarter.

Meta

The Facebook owner has been among the most aggressive AI spenders, which the company says is helping to boost ad targeting and engagement in its social media apps. But that’s taking a toll on free cash flow, which is projected to be $3.9 billion in the first quarter, the lowest in nearly four years. To keep a lid on expenses, Meta is planning to cut about 10% of its workforce, with the reductions expected to start next month.

Analysts anticipate that Meta will report net income of $17.2 billion on revenue of roughly $56 billion, up 3.4% and 31%, respectively, from a year ago. That would be its fastest sales growth since the third quarter of 2021, according to data compiled by Bloomberg.

Amazon

Shares of the e-commerce giant are up 25% in April, putting them on track for their best month in nearly four years after an ugly start to 2026. Just last week, Amazon reported agreements with Anthropic, Meta and Oracle to expand use of its cloud-computing services.

The Seattle-based company is expected to deliver first-quarter net income of $18 billion on revenue of $177 billion, representing growth of 5% and 14%, respectively. Amazon Web Services sales are projected to expand 26%, up from 24% in the fourth quarter, according to the average of analyst estimates compiled by Bloomberg.

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