AI-Fueled Cloud Growth Drives Chips and Software Gains, Wedbush Says
GOOG•Wedbush analysts note that Q1 earnings from Alphabet, Microsoft and Amazon showed double-digit growth in cloud services fueled by AI model deployments across industries. The firm expects continued expansion of AI-driven data-center chip orders and software subscriptions to support sustained revenue growth for chipmakers and hyperscalers in 2026.
1. Big Tech Earnings Highlight AI Adoption
Wedbush analysis shows that Q1 results from Alphabet, Microsoft and Amazon featured double-digit year-over-year growth in cloud and software segments as clients ramped up AI workloads. Analysts cited robust bookings for GPU-based infrastructure and enterprise AI applications as the key driver.
2. Sustained AI Infrastructure Spending Predicted
The firm forecasts that data-center infrastructure spending on semiconductors, networking and cloud capacity will rise steadily over the next 12 to 18 months. Chipmakers focused on AI accelerators and hyperscalers offering AI platforms are expected to capture the majority of this incremental investment.
