Big Tech earnings show how big, smart spending can be rewarded by the market

I am growing tired of the endless bubble talk about all of the data center spending. It's obvious from this quarter that the bubble talk has been proven wrong; try getting someone to say that, though. So, who do I think I am to go there? Just an observer. One who believes that this was the quarter where we realized that if you didn't spend, you were already behind the 8-ball. This quarter, so far, we have seen the results of five large companies that are often discussed as creating the bubble: Club names Alphabet (parent company of Google), Amazon , Apple , Microsoft , and Meta Platforms (parent company of Facebook, Instagram, Threads, WhatsApp). Those are five of the "Magnificent Seven" stocks. (No. 6 is Nvidia , which we also own; it reports on May 20. Tesla is the seventh, but we don't own it.) All so far have spent a huge amount to build out their sites. All have much more building to do. Let's look at how much the companies estimated their capital expenditures to be this year and how their stocks did this week before and after earnings. Alphabet, data center spend, $180 billion to $190 billion, stock price: $349 to $385 for a 12% weekly gain. Amazon, data center spend, $200 billion, stock price: $260 to $268 for a 1.6% weekly gain. Apple, data center spend: $13 billion, stock price: $271 per share (April 24 close) to $280 (Friday close) for a 3.4% weekly gain. Microsoft, data center spend, $190 billion, stock $429 to $414 for a 2.4% weekly loss. …