Week Ahead: Alphabet, Amazon, AMD Earnings & AI Infrastructure Demand

Upcoming Big Tech Earnings

• 🚀 Alphabet, Amazon, and Advanced Micro Devices (AMD) are set to report earnings this week, with a focus on their performance in key business segments.
• 💡 The market is closely watching for signs of accelerating growth, especially in cloud services and AI infrastructure.

Alphabet's Performance Outlook

• 🔍 Expectations for Alphabet's core search business are for low to mid-teens growth, while YouTube is anticipated to see high teens growth.
• ☁️ Google Cloud is projected to achieve at least 35% growth, with potential for sequential acceleration and beating consensus numbers due to strong deal wins and internal TPU capabilities.
• 🧠 Google's TPU processors are expected to offer efficiency in AI infrastructure, potentially leading to better gross margins compared to other hyperscalers.

Amazon Web Services (AWS) Expectations

• 📊 AWS, Amazon's cloud unit, is expected to show low 20% growth, with the key factor being sequential acceleration.
• ⚠️ Supply constraints for AI compute capacity could impact AWS's ability to exceed consensus numbers, despite its large scale.
• 📈 Any growth exceeding low 20% for AWS would be considered impressive and could positively impact Amazon's stock.

Advanced Micro Devices (AMD) and AI Chip Demand

• ⚡ The demand for AI infrastructure remains insatiable, with hyperscalers planning significant capital expenditure increases.
• 💰 AMD, as the second-largest GPU provider, is expected to benefit from this trend, with deals like the one with OpenAI potentially helping them exceed expectations.
• 🤝 The market is large enough that companies like AMD can succeed with good products, even without directly winning market share from Nvidia, as evidenced by the significant deal with OpenAI.