Microsoft, Amazon and Alphabet earnings reveal the next challenge in the AI race: ‘It isn't only chips now…’

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Despite fears about AI spending, the latest earnings from Big Tech show that demand for AI infrastructure remains resilient. Strong cloud growth at Microsoft, Amazon and Alphabet suggests their AI investments are beginning to pay off. The companies also committed aggressive capital spending plans, providing fresh evidence that demand for AI chips, data centres and related infrastructure will remain strong.
Acknowledging that the demand is real, Sandeep Nambiar, Co-Founder and CEO, OneCap, says, “For example, Microsoft is carrying $678 billion of contracted future revenue, up 84%. Those aren't empty data centres waiting on customers.”
Nearly $2 trillion has shifted into or out of the six Big Tech companies that have reported earnings so far this season. The biggest winners were Amazon, Microsoft and Alphabet, showing that their massive AI spending is starting to pay off.
With higher earnings, the constraint has also grown. The challenge is no longer just a shortage of AI chips. Companies are now competing for power, land and memory.
“Apple flagged advanced chip shortages and sharply rising memory prices in the same week. When a phone maker and a cloud provider are competing for the same components, that's a real squeeze,” says Nambiar
“Also, investor patience has run out. Alphabet raised its capex guidance to $195-$205 billion, and the stock fell by 7%. Amazon raised its target by $20 billion to $220 billion, and its shares rose more than 10%. Same move, opposite reaction. The only difference was whether cloud revenue moved in the same quarter.”
As the AI race enters a new phase, it is time for companies to prove they can overcome infrastructure constraints and turn record AI spending into sustained growth and profits.
Sanchari Ghosh is an Assistant Editor at Mint with over 12 years of experience in journalism, specialising in personal finance, DLT & DeFi, geopolitics and foreign policy, with a particular emphasis on how these areas intersect. <br> She writes extensively about how money works in everyday life—helping readers navigate personal finance decisions. <br> As AI reshapes investing behaviour, capital is increasingly flowing into decentralized ecosystems, redefining how assets are managed, traded, and valued. She focuses on explaining how money flows within frameworks like Distributed Ledger Technology (DLT), DeFi protocols, and crypto markets—while also exploring what the future of money could look like in a trustless, programmable financial world. <br> She also focuses on immigration-related issues, simplifying complex topics around visas, passports, overseas financial planning, and the many practical challenges Indians face while moving or living abroad. <br> Alongside personal finance, Sanchari has a strong understanding of international politics, contemporary and historical conflicts, and global state decisions. She closely tracks how geopolitical developments influence economies, markets, and individual financial choices, bringing together finance and global affairs in her reporting. <br> She began her career as a desk editor, which gave her a strong foundation in news writing. Over time, her interest naturally shifted toward personal finance. Before joining Mint in 2020, she worked DNA, The Times of India, Outlook Money, BloombergQuint, and ETMoney. At Mint, she got an opportunity to expand her coverage to include immigration and geopolitical developments while continuing to closely follow personal finance trends and market movements.As a journalist, she is committed to accuracy, intellectual rigour, and fairness. <br> She is an English Major and her work took her across cities including Delhi, Mumbai, and Pune. Living independently from an early age gave her firsthand experience in managing life and money on her own. This practical exposure sparked her strong interest in personal finance. <br> Outside the newsroom, Sanchari is a sports enthusiast who regularly plays lawn tennis and squash. In her younger years, she was also a national-level badminton player.
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