Big Tech earnings due on October 28 will test whether cloud growth at Amazon, Microsoft and Alphabet is accelerating fast enough to support their massive artificial intelligence investments. Analysts expect faster growth across all three companies’ cloud businesses for the September 2026 quarter, even as investors question the cost of financing AI infrastructure.
Key Takeaways
- Analysts expect Google Cloud to lead the three major providers in revenue growth.
- Microsoft plans to disclose Azure’s quarterly revenue for the first time under a revised reporting structure.
- Alphabet and Amazon are expected to burn cash, while Microsoft is expected to generate more than $8 billion in cash flow.
Big Tech earnings face an AI spending test
The three companies have nearly $1.7 trillion in combined backlog and plan to spend as much as $600 billion in 2026. Investors are looking for evidence that AI demand and cloud revenue can justify that investment without putting further pressure on cash flow.
Financing concerns have intensified as bond yields at AI cloud providers such as CoreWeave have risen and the cost of insuring Meta Platforms’ debt has reached a record. Meta’s better-than-expected revenue growth and upbeat outlook last week were overshadowed by increased spending plans; its shares fell nearly 7% the following day.
Brian Mulberry, chief market strategist at Zacks Investment Management, said cloud growth at Amazon, Google and Microsoft would signal whether further capital spending could be funded without additional risks to free cash flow.
| Item | Details |
|---|---|
| Google Cloud | Estimated revenue growth of 95.1%, compared with 81.8% in the previous quarter. |
| Amazon Web Services | Estimated revenue growth of 38.2%, compared with 36.8% in the previous quarter. |
| Microsoft Azure | Estimated revenue growth of 47.7%, compared with 42% in the previous quarter. |
Cloud growth expectations
Google Cloud is expected to post September-quarter revenue of $29.57 billion, up 95.1%, based on LSEG estimates. Analysts also expect growth to accelerate at Amazon Web Services and Microsoft Azure. These figures are forecasts, not reported results.
Alphabet is expected to burn cash for a second consecutive quarter and Amazon for a third, while Microsoft is expected to generate more than $8 billion in cash flow.
Microsoft reporting changes and Google search
Microsoft will report under a revamped structure, combining cloud, AI and business software in an Agents and Infra division and placing Windows, gaming and advertising sales in Devices and Consumer. It will also disclose Azure’s quarterly revenue, after previously emphasizing its growth rate. Analysts expect Azure sales of $33.06 billion.
At Alphabet, investors will also be watching Google search as chatbots and personal AI agents compete for users. Search revenue growth is expected to slow to 14.7% from 16.8% in the previous quarter, even as total revenue growth is expected to accelerate slightly to 25.2%.
Read More News
Disclaimer
This FinanceVelix article provides general information, not personalized financial, investment, legal, or tax advice. Market prices, interest rates and economic conditions can change; investments carry a risk of loss. Facts reflect the material available when published and may change. Check important information independently and consult a qualified professional when needed. Mentioning an asset, company, or service is not an endorsement.
Comments
Be respectful. No spam, impersonation or private credentials. Ordinary posts and comments appear immediately; suspicious links are held for review.
Please wait…