Actionable takeaways from Google, Amazon, Microsoft, and Meta earnings

Today’s issue in preview:

• Actionable takeaways from Google, Amazon, Microsoft, and Meta earnings

• Strong AI demand is driving explosive growth in these Power Grid Upgrade stocks

• These stocks are soaring and pay huge yields. Do you own them?

• Our extraordinary track record gets even better: Our E&C theme soars to new highs, remains one of the hottest trades on Wall Street.

Actionable takeaways from Google, Amazon, Microsoft, and Meta earnings

Credit: Nikada

Stay long AI infrastructure. Let the largest collective investment effort of all time make you money.

That’s my actionable takeaway from the most important series of earnings reports so far this year.

Last night, tech giants Meta (META), Google parent Alphabet (GOOG), Microsoft (MSFT), and Amazon (AMZN) reported their quarterly business performance. That performance – particularly in AI – was incredible.

Revenue from Microsoft’s AI-driven Azure unit and other cloud services surged 40%. Google’s AI-driven cloud revenue grew 63%. Amazon’s Web Services’ division – driven by AI compute demand – grew revenues 28%.

Big tech firms are seeing so much progress in AI development and so much demand for AI programs that they plan to spend as much as $725 billion this year on AI infrastructure. This is on top of the $1 trillion+ they’ve already invested. More than $3 trillion is forecasted to follow.

Again, it’s the largest collective investment effort of all time. And to the disappointment of AI bears, it’s as strong as ever.

As we’ve covered many times over the past year, the AI infrastructure super boom is creating “demand shocks” in many manufacturing and critical resource industries.

Not a supply shock, mind you, where a war or a pandemic abruptly cuts off the supply of a resource like oil.

Instead, I’m talking about a “demand shock,” where demand for a specific resource or manufactured product suddenly skyrockets… and sends its price hundreds of percent higher. This creates boom times for the companies involved, as their unit sales and per-unit prices skyrocket simultaneously.

Twenty years ago, demand shocks for manufactured goods and natural resources were relatively rare. Businesses had time to anticipate new sources of demand and plan accordingly. For many industries, those days are over.

AI – the fastest-evolving technology in history and the focus of the largest capex spending cycle in history – has changed the rules. AI’s power, adoption rates, and capacity are exploding… from just one quarter to the next. As detailed above, its development is being fueled by the largest investment budgets in history.

Over the past six months, I’ve written dozens of research notes detailing the specific themes of the AI megatrend and the specific ways we can profit from them. Nuclear power. Natural gas pipelines. Semiconductor equipment. Indium Phosphide. Optical networking. Utility stocks. The Invesco Equal Weight Technology ETF (RSPT).

And importantly, big tech’s epic investment program will fuel the next phase of the big AI story… the Agent Supernova we are “maximum bullish” on.

AI is no flash-in-the-pan trend. It will be a glacier-like, 10+ year megatrend that will change our world forever. I’m still very long.

Strong AI demand is driving explosive growth in these Power Grid Upgrade stocks

Credit: zhaojiankang

It didn’t generate the buzz big tech did, but last night, Quanta Services (PWR) so issued an important and extraordinary report on its recent business results.

The big electric grid contractor reported that quarterly revenue grew 26% to $7.87 billion, and its backlog of work grew to a record $48.5 billion, up 37% year-over-year. As a result, the stock spiked 12% and reached new all-time highs.

Regular Money & Megatrends won’t be surprised to hear Quanta’s business is booming. We’ve mentioned it many times as a premier play on the Power Grid Upgrade megatrend.

On October 7, I detailed how big tech is conducting the largest investment effort of all time (see above). It has spent more than $1 trillion on AI infrastructure over the past three years, and more than $3 trillion is set to follow it.

All that AI infrastructure is poised to consume huge amounts of electricity. Goldman Sachs forecasts global data center power demand will climb 50% by 2027 and as much as 165% by the end of the decade. J.P. Morgan forecasts that global power demand will grow at a 3.6% compound annual rate from 2026 to 2030, a pace 50% higher than the previous decade.

This creates a big investment opportunity.

The U.S. power grid is often called the world’s largest machine. It’s a giant network of power stations, transmission lines, substations, and underground wires. Most people barely know it’s there or how it works, but without this big machine, your lights don’t turn on, there’s no Netflix, and your iPhone doesn’t charge.

Industry experts say the power grid is aging and creaking under the strain of increased electricity demand. The American Society of Civil Engineers (ASCE) gave the energy sector a D+ in its 2025 Infrastructure Report Card, citing concerns about rising energy demand, aging infrastructure, and a lack of transmission capacity.

Soaring electricity demand… a grid badly in need of an upgrade… AI supremacy on the line… and trillions of dollars of economic output on the line. As we said in October, it’s a recipe for a bull market in companies that build, repair, and upgrade our power grid.

This theme – which we call the Power Grid Upgrade – has become one of the biggest home run trades of the past year. Since my note, Quanta Services is up 65%. Fellow contractors MYR Group (MYRG) and Centuri Holdings (CTRI) are up 85% and 84%, respectively. Power plant turbine maker GE Vernova (GEV) is up 79%. Electric grid component maker Powell Industries (POWL) is up157%. These are huge gains in a short time.

The largest collective investment effort in history is creating a super boom in Power Grid Upgrade stocks. Quanta’s latest report and share price surge confirms this is one of the strongest business trends of the decade.

Giant business and technological trends that shape our world play out over years, not months. This means the financial market trends they manifest tend to persist for years, not months. This means that, despite the huge gains since our original recommendation, Money & Megatrends remains bullish on Power Grid Upgrade stocks.

These stocks are soaring and pay huge yields. Do you own them?

Credit: Shevchuk

As detailed above, big tech is on track to spend over $700 billion on AI infrastructure this year, which will consume huge amounts of electricity.

Great, but how are we going to fuel all those electric power plants?

For the past three years, I’ve seen the natural gas pipeline business as the best way to generate substantial passive income from the AI boom.

Natural gas is the preferred clean-burning fuel for power plants that support AI data centers. This is why natural gas producers such as EQT (EQT), Antero Resources (AR), Expand Energy Corp. (EXE), and Range Resources (RRC) are compelling long-term stock ideas.

However, all the natural gas in the world isn’t worth much if you can’t transport it to customers.

This is where America’s vast natural gas transportation, processing, and storage industry comes in. An extensive network of pipes crisscrosses America to allow energy companies to transport natural gas from the wellhead to the power plant. If we get an AI-driven boom in natural gas consumption, we get a boom in natural gas transportation by default.

This year, the market has enthusiastically supported our thesis. Blue chip pipeline operator Enterprise Products (EPD) has returned 24% and sits near all-time highs. Fellow blue chip Kinder Morgan (KMI) is up 20% and sits near all-time highs. Fellow blue chip operator Energy Transfer (ET) is up 23% and sits at an all-time high.

These individual stock gains have driven the pipeline operator-focused Alerian MLP ETF (AMLP) to a 16.2% YTD gain and a 75% three-year gain, an incredible return for a safe, stable collection of cash-generating businesses. Despite its big three-year run, AMLP yields a large 7.48%.

The typical pipeline operator is not your conventional “high-risk, high-reward” AI play. Instead, it’s a boring, predictable business that generates steady cash flows and shareholder distributions. And it’s getting an AI boost that will last for years. M&M is still bullish on pipelines.

Market Notes

• Our recommendation to own Engineering & Construction (E&C) firms to play the AI data center and U.S. manufacturing capacity booms is paying off spectacularly. E&C giants MasTec (MTZ), EMCOR (EME), Centuri Holdings (CTRI), IES Holdings (IESC) and Sterling Infrastructure (STRL) soared to all-time highs today.

• Our recommendation to invest in the Battery Tech theme to benefit from the AI and robotics booms continues to pay off. Battery tech firm EnerSys (ENS) reached a new all-time high today. The stock is up 44% since our December 8 note.

• Construction equipment giant Caterpillar (CAT) jumped to a new all-time high today after reporting exceptional quarterly business performance. This is a bullish economic signal.

• High-horsepower engine maker Cummins (CMI) reached a new all-time high today. This is another bullish economic signal.

Regards,

Brian Hunt
Editor, Money & Megatrends

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