Setting the Stage
Meta Platforms (NASDAQ:META | META Price Prediction) and Microsoft (NASDAQ:MSFT) report quarterly earnings after the bell Wednesday, July 29, followed by Amazon (NASDAQ:AMZN) on Thursday, July 30. The AI trade looks tired, and shorts are leaning in hard.
Shorts Bet Against the Capex Bill
Bearish positioning has surged as traders wager these hyperscalers will lift full-year AI spending yet again. Google parent Alphabet soundly beat earnings, but its shares tanked the next day after the company raised its 2026 capex guide to $195 billion to $200 billion. The spending spigot remains wide open, and that reaction now hangs over the entire group.
The setup rhymes with prior peaks. Short interest in Meta peaked in fall 2022, right before its historic rally, and Amazon shorts loaded up in late 2023 ahead of a massive 2024 run. Yet Meta’s 0.58 full-chain put/call ratio and Amazon’s 0.32 reading show calls still outnumbering puts across the options chain, complicating the bearish setup.
Consensus Expectations
| Ticker | Beat Odds | FY26 Capex Guide | Last Qtr Surprise |
|---|---|---|---|
| META | 90.2% | $125B to $145B | 56.79% |
| AMZN | 95.5% | ~$200B | 60.69% |
| MSFT | 91.5% | Q3 capex $30.88B (+84% YoY) | 4.9% |
Based on the tape, a beat is nearly priced in across all three. That leaves capex commentary and forward cloud growth as the swing variables.
What I’m Watching
Meta: I’ll be watching whether Mark Zuckerberg pushes the $125B to $145B capex range higher and how Reality Labs’ $4.03B operating loss trends. Ad price growth of +12% and impressions +19% last quarter set a high bar.
Amazon: Focus on AWS holding its 28% pace, the fastest in 15 quarters, and whether Andy Jassy quantifies the OpenAI Trainium and Anthropic deals. Prediction markets assign 92.5% odds capex clears $200B.
Microsoft: Azure constant-currency growth is the number. Traders put 53.5% odds on the 40% to 42% band. The $627 billion commercial RPO and $37 billion AI revenue run rate, up 123% year over year, anchor the bull case.
Why It Matters
Combined, these three anchor roughly a quarter of S&P 500 capex. If guides move higher again, the shorts may get the first move. If demand commentary keeps outrunning supply, the 2022 and 2023 pattern of squeeze-fueled rallies becomes the reference case, and the bulls have it. Meta’s Q1 2026 beat still produced an 8.55% earnings-day decline, a reminder that the beat is now table stakes.
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