April 25, 2026 — The earnings focus this week shifts to the Magnificent 7 group of mega-cap tech companies. Amazon (AMZN), Alphabet (GOOGL), Microsoft (MSFT), and Meta (META) are scheduled to report results on April 29. Apple (AAPL) will follow the next day.
Alphabet has outperformed among these five players. Its stock has roughly doubled over the past year. Year-to-date, Alphabet shares have led the group.
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Data from Zacks Investment Research shows Alphabet is expected to post earnings of $2.64 per share on $92.2 billion in revenue. That represents year-over-year changes of -6.1% and +20.6%, respectively. Estimates have remained stable in recent weeks.
Alphabet’s Cloud and Search Momentum
Alphabet’s cloud revenue growth in Q4 2025 hit 48%. That marked an acceleration from 34% in Q3 2025. Analysts expect Q1 2026 cloud growth to accelerate further. Management is likely to guide for continued momentum into Q2.
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Search revenue growth has shown a modestly accelerating trend. It reached 17% in Q4 2025 and 16% in Q3 2025. The Q1 2026 figure is expected in the 17% to 18% range.
Alphabet recently reiterated plans to spend $175 billion to $185 billion in capex this year. The number is unlikely to change in this release. But investors will listen for details on how heavy AI spending is being monetized.
According to a recent report, roughly 75% of programming at Google is now AI-generated and then reviewed by engineers. That is up from 25% last year.
Microsoft’s Azure Stalled Growth
Microsoft has emerged as the Mag 7 laggard. The stock needs a catalyst to show more momentum in the Azure business. Revenue growth in Microsoft’s cloud business appeared stalled in recent quarters. Growth rates were 26%, 26%, and 27% in the preceding three periods.
Management cited capacity constraints as the primary reason. But skepticism lingers in the market about that explanation.
Analysts expect Microsoft to report earnings of $4.07 per share on $81.4 billion in revenue. That would represent year-over-year changes of +17.6% and +16.2%, respectively.
Mag 7 Earnings Growth Picture
For the Mag 7 group as a whole, total Q1 earnings are expected to increase by 20.3% on 22% higher revenues. That compares with the group’s performance in recent quarters.
The broader S&P 500 picture is also positive. Through April 24, 138 S&P 500 members have reported Q1 results. Total earnings for those companies are up 23.1% from a year ago on 9.6% higher revenues. Of those, 76.8% beat EPS estimates and an equal proportion beat revenue estimates.
Combining actual results with estimates for remaining companies, total S&P 500 earnings are expected to increase by 14.5% on 9.7% higher revenues.
Earnings Outlook Expands Beyond Tech
Zacks data shows a steadily improving earnings outlook over the past year. That improvement has been driven mostly by the tech sector. Positive tech estimate revisions have offset negative revisions elsewhere.
But the trend has expanded. Q2 estimates have moved higher for five of the 16 Zacks sectors. These include tech, energy, basic materials, utilities, and business services. Rising estimates for the energy sector are tied to Middle East developments.
On the negative side, Q2 estimates have been cut for 11 sectors. The most pressure is on transportation, autos, and consumer discretionary.
Current expectations call for 19.9% earnings growth in Q2 on 9.5% higher revenues.
What This Week’s Earnings Mean
This week marks the heart of the Q1 reporting cycle. Nearly 800 companies are scheduled to report, including 178 S&P 500 members. The lineup spans all sectors, from Mag 7 tech firms to oil supermajors.
Industry watchers note that net margins for the 138 reporting companies are holding up well compared to recent periods. The cyclical versus non-cyclical divide remains stable, with non-cyclical sectors accounting for 56.7% of total Q1 index earnings.
The implication is clear. If Mag 7 earnings meet or beat expectations, the broader market rally could sustain. If cloud growth disappoints, especially at Microsoft, the group’s laggard status could weigh on sentiment.
For investors, the key question is whether AI spending is translating into revenue growth. Alphabet’s cloud acceleration and Microsoft’s Azure trajectory will be the main signals.
This article originally appeared on Zacks Investment Research.
This article was produced with AI assistance and reviewed by our editorial team for accuracy and quality.
