Article | Sleepy.md

On April 29, 2026, Microsoft, Google, Meta, and Amazon all released their Q1 earnings reports on the same day. Looking specifically at the capital expenditure guidance provided by these four companies, the figure approaches $650 billion. This scale is already comparable to the entire annual GDP of Sweden.

In other words, the four wealthiest tech giants in the world are preparing to spend an amount equivalent to a medium-developed country’s annual economy to secure their ticket into the AGI era.

Now, everyone’s eyes are fixed tightly on that ticket to AGI. In this moment, often dubbed the “Night of the Final Battle” for global AI assets, if we slightly shift our focus away from those grand narratives and look into the less conspicuous hidden corners, we will find an underground war over physical shackles, capital anxiety, and industry restructuring, which has actually reached a point of no return.

How can a company that hasn’t reported earnings crash the US stock market?

The true market sentiment controllers are not necessarily the companies with the most profitable books, but the enterprises regarded by all as “faith symbols.”

April 29 was originally the most significant day of the US earnings season. But before the listed companies finished their reports, the market experienced an unanticipated plunge. Data from Goldman Sachs shows that this was the second-worst trading day for AI assets this year.

The trigger was not a major earnings miss from any listed company, but a report from The Wall Street Journal the day before, stating that OpenAI failed to meet its 2025 revenue targets, and the goal of 1 billion active weekly users remains distant. What further stung the market nerves was the report mentioning that OpenAI CFO Sarah Friar had internally warned that if revenue growth continued to underperform, the company might struggle to support its $600 billion compute power procurement commitments.

A company that is not publicly listed and does not need to release financial reports, just based on a rumor, caused Oracle’s stock to fall 4%, CoreWeave to drop 5.8%, and even SoftBank across the Pacific to plunge 12% in the over-the-counter market.

When the $600 billion compute power commitment collided with unfulfilled revenue growth, the market suddenly realized that the most dangerous aspect of the AI narrative is not that no one believes in the future, but that the future is just too expensive.

Over the past two years, OpenAI has become a religion in Silicon Valley.

Decisions on graphics card procurement, data center construction, cloud provider expansion, and startup valuations, many seemingly scattered, are all underpinned by the same judgment: model capabilities will continue to leap, user scale will keep expanding, and AGI will eventually turn all today’s costly investments into future tickets.

The strongest aspect of this logic is its self-reinforcing nature. The more people believe, the higher the valuation; the higher the valuation, the more others dare to believe.

But around April 29, the market began to seriously question the cash flow behind this faith. Even OpenAI has to face customer acquisition costs, user retention, revenue growth, and compute bills.

Printing Money and Cooling Water

The most fascinating part of the internet era is that growth appears almost limitless.

Write a piece of code, copy it to ten million users, and the marginal cost is spread extremely thin. Over the past twenty years, Silicon Valley has dared to overturn traditional industries with “burning money for growth” because of this belief: as long as network effects are strong enough, scale will swallow costs.

But in the AI era, the digital printing press is being tightly choked by the cooling water pipes of the physical world.

At the April 29 earnings call, despite the astonishing 63% growth in cloud services (with quarterly revenue surpassing $20 billion for the first time), Google CEO Sundar Pichai expressed helplessness: “If we could meet demand, cloud revenue could be even higher.”

Behind this statement lies the most peculiar business dilemma of the AI era: demand far exceeds supply, but growth is ruthlessly limited by the physical world.

Google holds a backlog of cloud orders worth up to $462 billion, nearly doubling quarter-over-quarter. AI solution products grew nearly 800% year-over-year, Gemini Enterprise paid user numbers increased 40% quarter-over-quarter, and API token usage soared from 10 billion per minute to 16 billion.

These numbers would be celebrated growth for any internet company. But in Pichai’s words, we hear a new kind of dilemma emerging in the AI age: customers are already lining up, money is on the way, but servers are not yet built, power is not yet connected, and advanced chips are not yet manufactured in wafer fabs.

It’s not a lack of demand, but demand so overwhelming that it pulls growth back into the physical realm.

Microsoft faces the same dilemma. Azure’s growth hit 40%, and AI annualized revenue surpassed $37 billion—up from just $13 billion in January 2025, nearly tripling in 15 months.

However, Microsoft’s capital expenditure decreased quarter-over-quarter to $31.9 billion from $37.5 billion, a reduction of nearly $6 billion. The company explained this as “infrastructure build-out timing.” The implication is that money can be approved today, but data centers won’t be built overnight; GPUs can be ordered, but power, land, cooling systems, and construction cycles cannot be hastened by the capital markets.

When everyone thought we were rushing toward a virtual world, the ultimate determinants of victory are still the oldest: heavy assets and physical laws.

Compute power is becoming a new kind of “land resource,” limited in the short term, slow to build, location-dependent, and first-come, first-served. In this land grab, the reason the four giants are willing to push capital expenditure to the $650 billion level is not because they have all calculated the returns, but because they fear that if they don’t hoard this “land,” they might not even get a seat at the table tomorrow.

Burning Money Tactics

After market close on April 29, despite exceeding expectations and raising capital expenditure