"Shout Out to Godgle": Google Soars Over 6% After Meeting Wall Street Expectations, Meta Plunges

Meta Signals Expanded CAPEX Investment

Plans to Further Invest in AI Infrastructure

Wall Street Expresses Concerns Over Infrastructure Spending Burden

On April 29 (local time), major Big Tech companies released their first quarter earnings simultaneously. Alphabet (the parent company of Google) exceeded heightened earnings expectations and surged more than 6% after market close. In contrast, Meta (the parent company of Facebook) announced plans to increase its artificial intelligence (AI) infrastructure investment this year despite posting better-than-expected revenue, leading to a drop of more than 6% in its stock price, showing a stark contrast between the two companies.

Google up 6.82% after market close

As of 8:20 a.m. on April 30 (Korea Standard Time), Alphabet (based on Class C shares), the parent company of Google, had declined 0.05% during normal trading hours overnight but surged 6.82% after market close. Microsoft (MS) fell 1.12% and then dropped an additional 0.35% after hours. Amazon rose 1.29% and then climbed an additional 2.44%. Meta fell 0.33% during normal trading and then plunged an additional 6.49% after hours.

Sundar Pichai, CEO of Google. Photo by Yonhap News Agency

The main driver behind these stock price fluctuations was earnings performance. Alphabet announced in a filing released early on April 30 (KST) that its first quarter revenue reached 109.9 billion dollars, a 22% increase from the same period last year. This figure surpassed the 107.2 billion dollars expected by financial analysts surveyed by market research firm LSEG and marked the highest quarterly growth rate since 2022. Earnings per share (EPS) came in at 5.11 dollars, nearly double the market consensus of 2.63 dollars.

The main contributor to revenue growth was the cloud division. Google Cloud's revenue soared 63% year-on-year to 20.02 billion dollars, surpassing the 20 billion dollar mark for the first time. This also significantly exceeded market expectations of 18.05 billion dollars. Operating profit in the cloud division soared to 6.6 billion dollars, tripling from last year's 2.2 billion dollars. Revenue from core businesses such as Google Search grew 19%. Other divisions, including self-driving taxi unit Waymo, posted revenue of 411 million dollars, a slight decrease from last year.

Sundar Pichai, CEO of Google, emphasized, "Enterprise AI solutions became the key driver of cloud growth for the first time in the first quarter," and added, "2026 is off to an excellent start, and our AI investments and full-stack approach are delivering results across all areas of our business." He also noted that the number of paid monthly active users (MAU) for the enterprise AI model 'Gemini Enterprise' increased by 40% compared to the previous quarter, and that the number of personal paid subscribers for services such as YouTube and AI reached 350 million.

'Solid revenue' yet Meta drops after CAPEX hike announcement

Mark Zuckerberg, CEO of Meta. Photo by AFP News Agency

In contrast, Microsoft, the world's largest software company, saw its first quarter revenue rise 18% thanks to strong cloud growth, but failed to meet market expectations. In particular, concerns remained among investors regarding the massive AI infrastructure investments. Amazon's quarterly revenue grew 17%, but its operating profit fell short of guidance. Amazon's stock price initially plunged on disappointing results but soon rebounded.

Meta, which operates social networking services (SNS) such as Facebook, Instagram, and WhatsApp, also posted a 33% year-on-year increase in quarterly revenue, surpassing market consensus. However, concerns about stagnant user growth and the burden of AI infrastructure investment led to a sharp decline in its stock price. On this day, Meta raised its 2026 capital expenditures (CAPEX) guidance from the previous range of 115 billion to 135 billion dollars to 125 billion to 145 billion dollars. Gil Luria, Managing Director of Investment Bank (IB) D.A. Davidson, pointed out, "Meta's results met expectations, but with Google's strong performance, they were not impressive enough to leave a mark on investors."

Additionally, concerns were raised about a slowdown in its core business. According to CNBC, Meta's daily active users (DAU) for its SNS platforms in the first quarter reached 3.56 billion, a decrease of more than 5% compared to the previous quarter. Meta explained that this decline was due to the Iran war and restrictions on WhatsApp access in Russia.

AI infrastructure investment is a double-edged sword. It has also raised the bar for Wall Street's scrutiny of Big Tech this year. Earlier this year, Google, Amazon, Microsoft, and Meta all announced plans to aggressively increase capital expenditures, fueling the so-called 'AI bubble' debate in the market. The combined CAPEX planned by these four companies for this year stands at 645 billion dollars, up 56% from the same period last year. With Meta's announcement to further ramp up investment, this figure is expected to rise even higher.

This content was produced with the assistance of AI translation services.