Catenaa, Sunday, May 03, 2026- The world’s biggest technology companies posted strong earnings last week, showing that the AI boom is alive and well, but concerns still lie in the stock market.
On one end is Alphabet’s strong growth at Google Cloud and in its other AI products, which sent the shares soaring 10% on Thursday, pushing their gain for the year to 23%, by far the best performance among the Magnificent Seven tech giants.
The stock is now the biggest point contributor to the S&P 500 Index’s rise in 2026.
On the other end is Meta Platforms, Facebook’s parent, which tumbled more than 8% on Thursday despite strong results as investors balked at Chief Executive Officer Mark Zuckerberg’s assurances about the eventual payoffs from its rapidly rising capital expenses, which are increasingly being funded with debt.
The shares are down 7.8% in 2026, while the S&P 500 and tech-heavy Nasdaq 100 Index are in the green.
The outcome was a $566 billion divergence on Thursday as Alphabet’s market capitalization took off and Meta’s sank a day after their earnings reports.
More than three years into a bull market fueled by excitement about AI and heavy investments in computing infrastructure, earnings reports are showing that two key pillars remain intact: Big Tech profit growth continues to outpace the rest of the market, and the flow of money into AI infrastructure keeps growing. But investors are increasingly separating companies that can draw a line from spending to revenue growth and those that can’t.
With reports now in from all of the Magnificent Seven companies aside from Nvidia, the group is on pace to deliver earnings growth of 57% in the first quarter, more than three times the 18% estimate at the start of earnings season, according to data compiled by Bloomberg Intelligence.
The rest of the S&P 500 is on track for earnings growth of about 16%.
Apple and Amazon also offered encouragement to investors. The iPhone maker’s shares climbed 3.3% on Friday, their biggest gain in months, after the company forecast revenue growth of as much as 17% in the current quarter, far exceeding Wall Street estimates.
Meanwhile, Amazon shares ended the week at a record high after posting the fastest quarterly sales growth in its cloud business in more than three years.
Taken as a whole, Big Tech’s results gave a substantial boost to the S&P 500 and Nasdaq 100, which ended last week at fresh records despite oil prices settling above $100 a barrel and data showing inflation ticking higher.
Since the S&P 500 bottomed in late March, tech giants have been the driving force behind the index’s rebound. The seven biggest companies in the benchmark, Nvidia, Apple, Alphabet, Microsoft, Amazon, Broadcom, and Meta, are responsible for more than half of the advance from the March 30 low, according to data compiled by Bloomberg.
Meta wasn’t the only Big Tech company to be punished last week. Microsoft shares sank nearly 4% on Thursday after the company projected 2026 capital expenditures of $190 billion, which overshadowed its forecast for accelerating revenue in its Azure cloud computing business.
The stock has lost 14% this year, making it the worst performer among the Magnificent Seven and the biggest point drag on the S&P 500.
