Hyperscalers Microsoft (MSFT), Amazon (AMZN), and Alphabet (GOOGL) have released their quarterly results, once again putting the spotlight on rising AI spending and cloud growth. Over the past five days, these tech giants have gained 5%, 4%, and 4%, respectively, due to a broader strength in the tech sector.
Claim 55% Off TipRanks
- Unlock hedge fund-level data and powerful investing tools for smarter, sharper decisions
- Discover top-performing stock ideas and upgrade to a portfolio of market leaders with Smart Investor Picks
While high capital expenditure (CapEx) is still a concern, strong cloud growth is giving bulls more confidence.
Quarterly Highlights
Microsoft Stock (MSFT)
Microsoft delivered a strong earnings beat this quarter, reporting revenue of $82.89 billion and EPS of $4.27. The highlight was Azure, where growth accelerated to about 40%, reversing a long stretch of slowing momentum as demand for AI tools picked up.
On spending, capital expenditure came in at $31.9 billion—around $3.4 billion below estimates—offering some near-term relief on cost concerns. However, the long-term outlook remains aggressive, with Microsoft now expecting 2026 CapEx to reach about $190 billion, driven in part by higher costs for key hardware like memory and storage.
Amazon Stock (AMZN)
The e-commerce giant delivered a strong report, with revenue rising 17% to $181.5 billion and a record operating margin of 13.1%. Much like its peers, the focus remained on cloud momentum, as AWS revenue jumped 28% to $37.6 billion—marking its fastest growth rate in 15 consecutive quarters. CEO Andy Jassy highlighted the growing traction in AI services, noting that the run rate for AI services has now exceeded $15 billion.
To support this rapid expansion, Amazon reaffirmed its $200 billion CapEx plan for 2026. In the first quarter alone, capital expenditures hit $44 billion, with the majority of those funds directed toward data centers and Amazon’s custom AI chips, such as Trainium.
Alphabet Stock (GOOGL)
Alphabet delivered what analysts are calling a “blockbuster” quarter, with EPS jumping 82% year-over-year to $5.11, well above expectations. Revenue rose 22% to $109.9 billion, marking its 11th straight quarter of double-digit growth.
This strength was largely driven by Google Cloud, which crossed the $20 billion quarterly revenue mark for the first time, growing 63% with a backlog above $460 billion. Investors cheered the results, sending shares up more than 7% in after-hours trading, as strong profitability and cloud momentum outweighed concerns over heavy AI spending.
Which Is the Best Hyperscaler According to Analysts?
We used the TipRanks Stock Comparison Tool to identify which hyperscaler is preferred by analysts amid the ongoing cloud war.
All three stocks carry a “Strong Buy” consensus rating. However, Microsoft stands out with the highest upside potential of about 30% and the lowest P/E ratio among the group. This suggests it offers the most attractive value relative to peers, even as Amazon and Alphabet continue to show strong momentum.
