MSFT, META, AAPL, and AMZN are up next for earnings

Microsoft is at the forefront of the AI ​​revolution, but investors want to see whether the payoff from heavy infrastructure investments is already starting to show up in the bottom line. In Microsoft’s report will focus not only on Azure’s overall growth but also on what percentage of that growth stemming directly from AI services (such as OpenAI integrations and Copilot interfaces).

Regarding Copilot monetization, a key questio is whether Microsoft 365 Copilot add-ons can generate sufficient recurring monthly revenue from enterprise customers to justify the massive computing costs.Investors are also scrutinising capital expenditure (CapEx) investments: Will capacity be expanded in a controlled manner, or will it erode free cash flow?

Thanks to AI-driven targeting and recommendation algorithms, Meta’s digital advertising engine has performed exceptionally well. Strong advertising revenue is anticipated, particularly due to user activity enhanced by AI algorithms.

However, the company’s substantial investments in AI models (Llama) and AI infrastructure have raised questions among investors. It is worth monitoring whether spending forecasts for the remainder of the year and AI investments remain under control relative to the growth in advertising sales.

As Apple’s device sales reach maturity, shifting investor focus to the hardware cycle associated with the upcoming AI suite this autumn and to the growth of services. Intense competition and local challenges in the Chinese market have been weak poinst for Apple. The report may provide indications as to whether the sales decline in China has already leveled off.

Investors are also looking for management to confirm whether the AI system launching this autumn will trigger a historic "super-upgrade cycle," compelling consumers to upgrade their older  iPhones to the new models. The higher-margin services business (App Store, iCloud, Apple Pay and Apple Music) is expected to continue growing and serve as a buffer for the company’s earnings.

Amazon offers a two-in-one package. It measures both global consumer sentiment through its online retail business and corporate IT spending through its cloud service, Amazon Web Services (AWS). AWS is engaged in fierce competition with Azure and Google Cloud, and investors are closely monitoring its operating profit margin.

It is also worth considering whether using proprietary AI chips (Trainium/Inferentia) has improved AWS’s profitability compared to competitors. Regarding e-commerce, the focus is on streamlining the regional delivery network: Can Amazon maintain growth in retail operating profit even as global consumer demand becomes more selective and inflation reduces purchasing power?

A crucial week for the stock markets is getting underway. Good earnings alone may no longer be enough to increase share prices. How well companies can demonstrate the payback period for their AI investments and the guidance management provides for the rest of the year amid an uncertain macroeconomic environment will be he decisive factors.

●     SMA200: 200-day moving average, red.

●     SMA50: 50-day moving average, blue.

●     EMA25: 25-day exponential moving average, yellow.