Q1 Earnings Recap: Five Thematic Takeaways

Research evidence excerpt

Q1 Earnings Recap: Five Thematic Takeaways

May 12, 2026 Q1 Earnings Recap: Five Thematic

Takeaways

Marvin Fong, CFA

(212) 527-3562 mfong@btig.com

WHAT YOU SHOULD KNOW: With the large majority of our coverage having reported

Q1 earnings, five different themes struck us as noteworthy. Even for those topics thatTECHNOLOGY,

are familiar to investors (e.g., AI), we picked up on changes in intensity and impact, at

least with respect to our coverage universe. Our five themes are: 1) AI showed signs

of moving up the labor value chain; 2) productivity gains are hitting P&Ls in a real way;

3) surging fuel prices weren't a factor, but the clock is ticking; 4) better-than-expectedMEDIA Q2 outlooks did not flow to second-half guidance; and 5) value-oriented stocks clearly

AND outperformed■ AI moved upgrowththe labornames.value chain. While some hiring indicators have improved of

late, we saw real evidence of expansion in AI-driven job displacement in quarterly

earnings. Upwork (UPWK, Neutral) stated that sub-$500 projects were seeing the

heaviest disruption from AI. Just last quarter the company said disruption was

mainly in sub-$300 work, suggesting AI is climbing up the value chain in terms of

capabilities. Upwork noted it conducted a study of all projects on its marketplace

and found that only ~10% of projects on its platform today can be replaced by

AI, down from ~11% when a similar analysis was performed a year ago. However,

given our estimate that GSV will decline 4% y/y in 2Q26, we should add that to

the cumulative negative impact of AI on labor demand. We've also noted pressure

on average project values, which could have ties to AI. Clients could be leveraging

AI to do easier components of a job, or it could be coming on the supply side as