July 20, 2024
As Databricks touts demand for AI services, all eyes are on Microsoft's and Alphabet's Q3 results

Earnings season is officially here, folks!

Microsoft and Alphabet will report their third-quarter financial results after the bell today, and Meta and Amazon will report later this week. And we can’t wait to find out if these companies will report a material improvement from their investments in AI-related computing tasks and products.

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We asked a similar question before Q2 2023 results came out and found that while the costs related to AI work were piling up, the resulting revenue was more a fact of the future than the present. Will we see similar themes this time as well?

You see, there’s a big difference between customers being excited about a new technology and tech actually bringing in gobs of revenue. We’re hoping to find out how quickly some of the largest and richest tech companies are able to convert this market interest around AI to revenue.

Big Tech’s ability to sell AI-powered tools and services will tell us pretty clearly just how ready the tech-buying market is to spend on new software. For startups, then, a solid result from Microsoft and Alphabet on the AI front would be great news. On the other hand, yet another quarter of Big Tech companies spending heavily on infrastructure paired with discussions of future revenue would be less bullish.

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