Tech earnings are coming, and perhaps ‘nothing looms larger’ than this factor

OpenAI has been at the center of massive artificial-intelligence infrastructure deals in recent weeks, and with Big Tech companies slated to report third-quarter earnings later this month, some analysts expect to see higher spending forecasts as the competition hits a new gear.

Apart from the ongoing trade tensions between the U.S. and China, “nothing looms larger over” quarterly results “than OpenAI’s spending ambitions,” Melius analysts led by Ben Reitzes said in a Monday note. “The private AI colossus’ appetite for compute should drive others to point to upside in capex spending forecasts,” Reitzes said, naming Meta Platforms Inc.

META, Alphabet Inc.’s Google GOOGL GOOG and Microsoft Corp. MSFT.