In previewing the Mag7 results last Sunday, I wrote about my concerns given the large rally coming into earnings but that Google was my favorite long-term. In looking at the results, Google did in fact perform the best and gained 12% last week while the S&P gained 1% and the other four Mag7 names that reported declined 2% on average. Estimates for AI capex growth for 2026 for the five biggest spenders which started the year close to 30%, which moved to 60% post Q4 results are now at 70% following the guidance this past week on earnings results. A quick summary of how to think of hyperscaler results were if ROIC was good, then the stock did well. In other words, if capex went then operating income estimates had to as well for the stock to be fine. $GOOGL increased capex but Google Cloud
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