Whatever Thursday’s broad market moves, one thing is clear after the latest megacap tech earnings reports: Demand for artificial intelligence chips is still beyond strong. Microsoft , Meta Platforms and Google-parent Alphabet reported better-than-expected third-quarter results. All three also hiked their capital spending outlooks, signaling even more investment going into AI. “The biggest thematic read from [Wednesday’s] earnings was the continued insatiable demand and spending by the hyperscalers following an upwards bias to capex #’s and commentary into ’26 from MSFT, GOOGL, and META,” Jefferies traders wrote. Others on the Street echoed that view: Wells Fargo: Cloud Capex — No Signs of Slowing: We think reported 3Q25 capex spend + forward comments from Microsoft, Meta, & Google will solidify views of continued cloud capex spend momentum into / thru 2026.” Evercore ISI: “While our forecasted 2025 CapEx growth only increased slightly to 73% growth, from prior 72%, our 2026 forecast increased to 33% from our prior estimate of 24%.” JPMorgan: “As anticipated, cloud and hyperscale datacenter infrastructure spending — across compute, networking, and storage/memory — is likely to remain structurally elevated over the longer term and we believe this suggests significant upside to out-year capex expectation.” Citi: “AI party continues – good for AMD , AVGO , MU , and NVDA — The higher capex guidance from Alphabet, Microsoft, and Meta supports our view that AI spending remains strong. This should be positive for AI-exposed stocks such as AMD (19% of sales), AVGO (33% of sales), MU (18% of sales) and NVDA (88% of sales).” To be sure, shares of Microsoft and Meta Platforms were under pressure Thursday from their respective spending forecasts, knocking the broader stock market. Alphabet, however, rallied. It’s not clear what this relentless demand for AI chips will mean for the broader market. For now, though, it shows these tech giants aren’t dimming their demand for AI chips. Fellow “Magnificent Seven” members Amazon and Apple are set to report earnings after the market closes Thursday. After Wednesday night’s reports, capex may be the key metric to look for out of those releases, too.
