Clouds, power, margins, and proof: Big Tech’s new religion

The week didn’t crown a new champion so much as reveal what the game has become. Microsoft, Alphabet, Amazon, Meta, and Apple all filed their quarterly numbers, and beneath the beats and misses, the earnings all sound largely like chapters in the same book: a story where the cloud is the platform, capex is the moat, and AI is the workload forcing everyone to build like they’re utilities.

Investors judged the plans like a planning board. Who brought proof — backlog, bookings, utilization — and who brought a genie and a Magic 8 Ball? Alphabet walked in with acceleration and a bigger checkbook. Amazon showed growth where it matters and energy contracts to back it up. Microsoft arrived with a reservation book that stretches past accounting. Meta, without a rentable cloud, promised to spend like it has one. Apple stayed Apple — margins, hardware, and services — reminding everyone that on-device distribution is its own kind of infrastructure.

The question of the week wasn’t “Who won AI?” or “Who won the cloud race?” It’s: Who can build, who can prove it, and how quickly do the dollars come back? On those terms, the scoreboard looked less like a hype contest and more like a utility map — the kind where confidence is measured in transformers and contracts, not slogans.

For years, Big Tech’s superpower was abstracted: growth that lived in the cloud, margins that lived in code. Now, the new bragging rights seem even more physical — megawatts, gigawatts, and billions upon billions of dollars in poured concrete. “Everyone is trying to balance these capex spends relative to each other,” said Asit Sharma, a senior investment analyst and lead advisor at the Motley Fool, “and that’s as hard for investors as it is for the hyperscalers themselves.”

Alphabet lifted its projected 2025 capex to $91–93 billion, with spending weighted toward the literal machinery of intelligence: about $14 billion in servers and $10 billion in networking and datacenter gear just last quarter. Microsoft spent $34.9 billion in three months, and Meta’s range of $70–72 billion for 2025 will grow “notably larger” next year. Amazon, which added 3.8 gigawatts of power in 12 months, says AWS now has twice the capacity it did in 2022, and the company plans to double again by 2027.

Analysts didn’t even bother to hide their awe. In a note, Wedbush analysts wrote that this is “an AI Arms Race and what is fueling this next chapter of growth is Big Tech spending and that is NOT slowing down into 2026….which we view as a huge positive and validation moment for the AI Revolution bullish thesis.” Deutsche Bank analysts described Meta as “front-loading this investment cycle,” which might be why the stock fell as much as 13% in the morning after trading. Right now, the bottleneck isn’t talent or chips — it’s power.

Ryan Lee, Direxion’s senior vice president of product and strategy, said that while Amazon’s strategy of continuing to acquire capacity “is not unique,” he said that “relative to [its] peers [Amazon] seems positioned best.” And that helps explain why the company’s shares were up 10% in mid-morning trading the day after its earnings release.

But the story isn’t really about who spent the most — it’s about why spending has become the story at all. The cloud and AI races are no longer parallel tracks; they’re the same contest for compute, power, and grid access. Capex has turned from a line item into a moat, and the companies that used to mostly ship products are now building infrastructure empires. Every dollar of construction buys them more than hardware; it buys control of the future’s capacity constraints.

What used to be marketing theater is now a land grab. Amazon is buying the grid; Microsoft is booking out energy for years ahead; Alphabet is securing its own supply chain of networking gear. Meta, famously late to infrastructure, is trying to buy time with dollars. “Traders aren’t just tolerating heavy capex anymore, they’re demanding it,” Direxion’s head of capital markets, Jake Behan, said in a note about Microsoft.

The irony, of course, is that the cloud — once a metaphor for weightlessness — is now part of a race to see who can build the most earthbound empire.

There was a time when Big Tech sold faith. A little narrative velocity, a slide deck about the future, and investors would follow the promise. For many firms, those days are gone. Now, the market wants capital P Proof — proof that the trillions to be poured into data centers will turn into durable demand, and proof that “AI monetization” isn’t just another euphemism for patience.

Microsoft, Alphabet, and Amazon each delivered that proof differently, but the verdict was the same: Rhetoric no longer clears the bar. Microsoft posted record revenue — $77.7 billion for the quarter, up 18% — and still had to defend its $35 billion in capex. The difference this time was the receipts. Azure-related services jumped roughly 40%, Microsoft Cloud revenue hit $49.1 billion, and its backlog ballooned to $392 billion, a figure that tells investors exactly how long the runway is. Shares fell around 3% the day after it reported earnings.

Alphabet followed the same playbook with a slightly more human flourish. Ad growth steadied just enough to subsidize the company’s next infrastructure binge — $91–93 billion in planned 2025 spending. Wedbush analysts wrote that the quarter “proved doubters wrong” and “further validates Alphabet’s position as a leading AI beneficiary,” and pointed to Google Cloud’s backlog growth and margin expansion as the rare signs of AI investments already paying off.

Amazon, meanwhile, didn’t need to gesture at faith. It had the numbers. CEO Andy Jassy’s comments about power constraints gave the investor call a refreshingly industrial feel. “Jassy’s commentary surrounding strong demand in AI and core infrastructure was exactly what investors were hoping to hear this quarter,” Direxion’s Lee said. The more physical the story sounds — data centers, grids, contracts — the easier it is for investors to trust.

The Motley Fool’s Sharma said Jassy reinforced an argument that he’s been making: Businesses are already on Amazon’s stack — and the company is building a stack on every level. Sharma said Jassy made the case that, “if you’re building a foundation model, you can do it right here. If you’re experimenting with gen AI, it’s already within your existing workflows. And if you want to build agentic software, you can build your own, or you can play with what we’re building here.”

For a generation of workers and policymakers, Big Tech’s power looked digital — algorithms, networks, influence. But this new phase puts more muscle back into capitalism. The companies moving markets are also moving dirt. And if you want to understand where the next trillion in valuation comes from, follow the cranes, not the code.

This quarter, the cloud race among the Big Three — Microsoft, Amazon, and Alphabet — started to look like it might be a photo finish. For years, Microsoft has owned the lead on enterprise contracts, Amazon has had the advantage in scale, and Google has had the sympathy vote for progress. But that order is blurring. Azure’s growth hasn’t cooled, AWS is accelerating again, and Google Cloud has finally stopped looking like the obvious underdog. The competition now looks less like a land grab and more like a sprint for customer trust — who can prove that the demand isn’t just theoretical, that the workloads are real, and that the cloud still has room to grow.

Microsoft’s forward commitments, AWS’s renewed acceleration, and Google Cloud’s margin inflection prove the race is less about hype and more about having the numbers to back it.

This week, the three companies reported:

• Microsoft Azure: up 40% year over year (revenue isn’t disclosed); $392 billion backlog (which excludes the new $250 billion OpenAI commitment)

• AWS revenue: $33 billion, up 20% year over year

• Google Cloud revenue: $15.2 billion, up 34% year over year; $155 billion backlog

Microsoft’s edge remains visibility. The company’s $392 billion in remaining performance obligations gives it the kind of forward clarity investors dream about. Operating income came in at $38 billion, up 24% year over year,” which Bryan Hayes, a strategist with Zacks Investment Research, said “really showcased Microsoft’s operational efficiency and its ability to translate aggressive cloud and AI spending into bottom-line profitability despite all this funding of aggressive growth investments and cloud and AI capabilities.”

Azure’s 40ish% growth rate hasn’t slowed, and it’s still the “player to beat,” Hayes said, though there’s “no shortage of competition,” even if “Amazon and Google are aggressively pricing services below Microsoft’s levels while delivering somewhat comparable functionality.” The Motley Fool’s Sharma called this “a neck-and-neck race” that now hinges on capacity discipline. Amazon, he noted, “monetizes new capacity the moment it comes online,” a sign that it’s still on the near side of overbuilding — and a sign that “Amazon will be there at the finish line.”

Amazon’s AWS, once the default, has rediscovered its pace. Growth re-accelerated to 20%, its fastest in almost three years, powered by the best momentum AWS has seen since 2021. AWS’s advantage isn’t just software — it’s the scale of its physical footprint. Meanwhile, Google Cloud revenue climbed roughly 34%. The implication is that Google finally has the balance sheet — and the backlog — to sit at the same table as Microsoft and Amazon.

The new metric of dominance isn’t who invented the platform but who owns the infrastructure beneath it. The subtext across every earnings call was unmistakable: This isn’t just cloud versus cloud anymore — it’s grid versus grid.

This quarter reminded investors that Big Tech’s next era is still funded by its last. For all the talk about trillion-dollar capex cycles and AI super-clusters, much of the money is still coming from the same sources it always has — ads, subscriptions, and devices. The future may be running on silicon, but it’s paid for in clicks and renewals.

The ad economy is still the oxygen supply. Meta’s ad revenue jumped 26% to $50.1 billion, powered by a 14% increase in impressions and a 10% gain in price per ad. Alphabet followed the same pattern at a greater scale: $74 billion in ad revenue, up roughly 12% year over year, while YouTube’s $10.3 billion quarter helped justify raising 2025 spending. In both cases, the old model of monetizing attention is bankrolling the infrastructure arms race.

Amazon sits somewhere between the two. Its advertising business grew 23% to $17.7 billion, and on the earnings call, Jassy pointed to live sports as one of the biggest front doors to that ad flywheel. Amazon’s advertising muscle is now feeding directly into its commerce and media ecosystems — and into the data centers powering them.

The subscription economy remains the stabilizer. Microsoft’s Productivity and Business Processes division — Office 365, LinkedIn, Dynamics — grew around 10%; Zacks’ Hayes called out the LinkedIn growth as particularly notable, crediting the company’s ability to “keep that revenue growth constant.” The steady churn of earnest networking posts has become part of the model — a content engine that turns career advice into recurring revenue.

And in Cupertino, the services flywheel is still Apple’s quiet superpower. Revenue from Services climbed 15% to $28.8 billion, holding gross margin near 46% even as iPhone sales softened. The iCloud, Apple Music, and App Store ecosystems keep producing enough cash to fund whatever AI or mixed-reality future Apple chooses to reveal — whenever it’s ready.

Put together, the picture is clear. Attention turns into ads, ads turn into infrastructure, and services keep the lights on. For all the talk of intelligence and compute, the most dependable power source in Silicon Valley is still human habit.

Microsoft, Alphabet, Amazon, Meta, and Apple spent this week proving they could translate scale into substance, and each arrived at the same conclusion: The future will be built, not just coded. Microsoft’s balance sheet looks like a public-works budget. Amazon’s AWS now talks like a power utility. Alphabet has turned its ad empire into a self-funding infrastructure experiment. Meta is spending like a company that knows it missed the first train but can still build the next station. And Apple, quietly and characteristically, keeps making its margins look like a moat of its own.

Somewhere between the cloud and the substation, Big Tech found its next identity. The industry that once promised to dematerialize the world is now building it back, one data center at a time. The dream didn’t die; it just went infrastructure-grade.