Big Tech earnings test AI boom as market turmoil clouds outlook

Wall Street expects Amazon, Microsoft, and Alphabet to report faster cloud growth on Wednesday, but a turbulent market selloff and rising AI financing costs are tempering optimism. Investors are pressing for evidence that the AI boom can deliver swift returns to justify its enormous price tag. Rising bond yields at AI cloud providers and record costs to insure Meta's debt have amplified concerns about funding the massive AI infrastructure buildout, especially with higher US interest rates looming. Market turmoil has rekindled warnings of an AI bubble, and an expected Democratic sweep of the midterm elections could spell more trouble for data centers targeted by protests. Meta's results last week showed the unforgiving calculus, with increased spending plans sending shares down nearly 7% despite better-than-expected revenue. The trio plans to spend up to $600 billion this year, and Google Cloud is expected to lead with revenue surging 95.1% to $29.57 billion. Microsoft will report under a revamped structure, disclosing Azure's quarterly revenue for the first time.