Only Google proves AI investment pays off

All three companies significantly increased AI capex. After-hours reactions diverged: Alphabet +7%, Meta -6% or more, and Microsoft flat. Analysts believe combined Big Tech AI capex could exceed $600B in 2026.

• Alphabet raised its 2026 capex guidance to $180B~$190B (up from $175B~$185B).
• Google Cloud revenue grew 63% year-over-year to $20B, while AWS grew 28% and Microsoft Cloud grew 40%.
• The cloud backlog reached $462B, nearly doubling from the previous quarter, with plans to convert 50%+ of this into revenue within the next 24 months.
• Gemini Enterprise's paid monthly users grew 40% quarter-over-quarter, and GenAI-based product revenue increased nearly 800% year-over-year.
• Meta raised its capex guidance to $125B~$145B (up from $115B~$135B).
• Microsoft presented total capex for this year of $190B, with Q4 capex expected to be $40B+. About two-thirds of spending goes to GPUs and CPUs, and about $25B is due to rising component prices. The company said capacity constraints could continue throughout 2026.