Azure grew 48% and AWS grew 39%, the fastest pace in nearly five years, and both said demand still exceeds supply. Microsoft beat with EPS of $4.89 versus $4.72 expected, while Amazon missed at $1.89 versus $1.96, largely because Prime Day moved into the second quarter and cut about 400 bps from retail growth. Azure revenue reached $33.17 billion while Windows OEM and Devices revenue fell 22%, and AWS operating income rose to $17.77 billion from $11.43 billion. Amazon's quarterly capex reached $77.26 billion, leaving a trailing free cash outflow of $42.4 billion, while Microsoft generated $18.6 billion of free cash flow. The author argues that GPU capacity shortages could send extra demand to Alphabet, Oracle and smaller AI-focused clouds, and the key items to watch are whether Azure meets its 49% to 50% growth guidance and whether spending above $220 billion in 2027 pressures AWS margins.
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Related tickers and likely impact
AMZN
▲ Likely positiveAmazon
Relevance: low
| Market | US stocks |
|---|---|
| Sector | Consumer Discretionary |
| Industry | Broadline Retail |
| Market cap | $2.7T |
| Close on 10/29/2026 | 244.23 |
| Change that session | -4.07% |
MSFT
▲ Likely positiveMicrosoft
Relevance: low
| Market | US stocks |
|---|---|
| Sector | Information Technology |
| Industry | Systems Software |
| Market cap | $3.9T |
| Close on 10/29/2026 | 530.43 |
| Change that session | -0.11% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
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