As the earnings season winds down, I continue to be blown away by the magnitude of some of these beats, many of which are coming from AI-adjacent names that few would have expected to be headlining the cycle. While the marquee players like Nvidia (NVDA), Alphabet (GOOGL) and Meta Platforms (META) are putting up enormous numbers and pouring billions into the buildout, I am continually surprised by results from names like Dell Technologies (DELL) and Hewlett Packard (HPE), which play comparatively smaller roles in the broader tech ecosystem but are nonetheless beneficiaries of the massive buildout.
The story of 2026 isn’t simply the sheer scale of AI infrastructure spending, but how rapidly and consistently expectations continue to move higher. At the end of last year, analysts projected hyperscaler capital expenditures of roughly $600 billion for 2026, already representing an impressive 36% increase from the prior year. Following the latest earnings season, however, those estimates have been revised upward to approximately $750 billion, implying annual growth of 67%. Forecasts for 2027 are already teasing the $1 trillion level. Hyperscaler AI capex now represents approximately 2.2% of US GDP.
One earnings report I am eagerly awaiting is Oracle (ORCL). While often overshadowed by the more prominent AI names, Oracle has made one of the most aggressive bets on the AI boom. Oracle has committed roughly $50 billion to AI, more than double its prior year and representing a capex-to-revenue ratio of approximately 76%, by far the highest in the hyperscaler cohort. A few months ago, I detailed here just how far founder Larry Ellison is willing to go to capitalize on this opportunity and why I believed the stock was compelling.
Oracle reports earnings on June 10, and with expectations rising alongside demand for AI infrastructure, the company enters the report with significant momentum behind it.
Image Source: Zacks Investment Research
Earnings Tell the AI Story
As noted, the earnings results have been truly mind-bending.
Nvidia revenue spiked 85% to $81.6 billion and Alphabet’sGoogle Cloud posted a 63% revenue increase. Meanwhile Gemini Enterprise paid monthly active users grew 40% quarter over quarter. Meta’s revenue hit $56.31 billion, up 33% year over year, the fastest quarterly growth since 2021. META also raised Capex guidance to $125–$145 billion.
Dell may have been the most jaw-dropping beat. Record revenue of $43.8 billion came in 88% above the prior year, with diluted EPS up 282%. Dell booked $24.4 billion in AI orders and recognized $16.1 billion in AI server revenue in the quarter alone. Management guided to approximately $50 billion in AI revenue for the full fiscal year.
