North America Internet: 2Q26 Preview: Raising Revenue & CapEx Projections for G00GL, META, AMZN on Strengthening Demand Trends

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North America Internet: 2Q26 Preview: Raising Revenue & CapEx Projections for G00GL, META, AMZN on Strengthening Demand Trends

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16 Jul 2026 05:10:09 ET │ 31 pages

North America Internet

2Q26 Preview: Raising Revenue & CapEx Projections for GOOGL,

META, AMZN on Strengthening Demand Trends

Ronald Josey AC

CITI'S TAKE +1-212-816-4545

In this note and our accompanying presentation, we preview 2Q26 ronald.josey@citi.com

earnings for Alphabet, Meta, and Amazon. We believe improving online Jake Hallac, CFA

advertising and eCommerce trends—based on checks (see our Cannes and

ad expert call notes) should result in better-than-expected revenue and +1-212-816-2001

profitability trends for 2Q and potentially 3Q guidance. That said, the focus jake.hallac@citi.com

remains on each company’s investments in AI compute and infrastructure Jamesmichael Sherman-Lewis

given continued strong demand trends (see our CIO survey note). As a result, +1-415-627-6014

and concurrently with this note, we are adjusting our projections for each

company. For Google we are including TPU sales into our GCP projections, jamesmichael.shermanlewis@citi.com

for Amazon, we are raising our AWS projections given its partnerships and

greater overall demand, and for Meta, we layer in greater online adv. demand

and potential subscription benefits. Across all three, we are materially

raising CapEx projections, resulting in negative FCF in ’27E & ’28E for each.

GOOGL: Search & Cloud Growth Durability in Focus as TPU Upside Emerges—

healthy ad trends and robust Cloud demand with incremental TPU revenue

beginning in 2H26. Raising GCP projections (+68.5% Y/Y in 2Q and +93.5% to

$190B in '27E, with ~$62B of TPU sales) & raising '27E CapEx by ~21% to $308B;