As the curtain falls on Big Tech earnings, investors are turning their attention to companies reaping the benefits of the AI surge here and now — not later. MicrosoftMSFT

, AlphabetGOOG

, and AmazonAMZN

all posted strong earnings fueled by soaring cloud revenue. However, costly AI hardware and infrastructure firms witnessed a downturn following a massive 16-month rally.

• Meta hinted at the necessity of “meaningfully” increased AI spending, which resulted in a 12% boost in its capex range. Even AI “laggard” Apple has recently invested in AI servers.
• According to a recent survey of tech leaders, most don’t believe their infrastructure is “AI-ready,” and 42% don’t expect a return on these AI investments for two years.

AI hype slows: Taiwan’s stock exchange, a bellwether for AI excitement, experienced its largest outflows last month since Oct. 2023 as chipmakers lowered their outlooks. Market sentiments have cooled towards chipmakers such as AMDAMD

, which narrowly beat sales expectations but still faced a dip in shares. Same for Super MicroSMCI

, where revenue missed, although the company remains optimistic about long-term AI demand. However, Nvidia’sNVDA

upcoming earnings on May 22 will test this hypothesis.