Alphabet Seen as Sharper Pre-Earnings Bet Than Apple on Cloud Backlog and Pullback

Blackstone-backed data centre operator AirTrunk plans to invest $1 billion to expand its TOK1 campus in Inzai, Japan, as demand for infrastructure to support artificial intelligence workloads grows. The investment will support the deployment of liquid-cooling technology for AI workloads at TOK1, which has more than 300 megawatts of capacity. AirTrunk CEO Robin Khuda said geopolitical factors are driving more customers to Japan as a North Asian hub. Khuda also said AI infrastructure deployment is becoming more difficult in the U.S. and is already challenging in Europe, making Asia a major beneficiary.

Jim Cramer said on the September 30 episode of Mad Money that Microsoft's massive artificial intelligence investment is entering a new phase as the company begins turning its data-center buildout into higher revenue. Cramer noted Copilot now has 30 million users and growing, Azure is accelerating rather than contracting, and Microsoft is beginning to recoup its monster data center investment, which he compared to the payback period Nvidia's Jensen Huang once described for his semiconductors. In its fiscal fourth quarter, Microsoft Cloud revenue increased 27% to $59.3 billion, while Azure and other cloud services revenue grew 43%, and commercial remaining performance obligations rose 84% to $678 billion, including a 25% increase excluding OpenAI. CFO Amy Hood said on September 9 that Microsoft had reduced dock-to-live times for infrastructure by more than 50% over the year, even as capital expenditures reached $41 billion in the June quarter and first-quarter fiscal 2027 spending is expected to exceed $50 billion. Microsoft Cloud's gross margin fell to 65% in the June quarter, and the company generated $19.6 billion of free cash flow while paying $35.8 billion for property and equipment, leaving margins and cash flow worth watching as spending continues to rise.

Land and Houses Securities Public Company Limited rates Infraset Public Company Limited, or INSET, and WHA Utilities and Power Public Company Limited, or WHAUP, as poised for continued growth from the expansion of the Data Center business and rising production capacity, and sees them as stocks with catalysts from new investment projects in the period ahead. For INSET, the analyst maintains a buy recommendation with a target price of 5.25 baht, expecting profit in the second half of 2026 to accelerate steadily, particularly in the third quarter of 2026, which has the potential to grow both quarter on quarter and year on year. The key driver comes from the gradual recognition of revenue from six Data Center projects in hand, with a combined size of approximately 335 MW. At the same time, there is remaining revenue from the Trading business still to be recognized of about 290 million baht. INSET's latest backlog has risen to approximately 5.7 billion baht after securing additional new work, and the company is in the process of bidding on another four to five large projects with a combined value of approximately 10 billion baht. If it wins this work, it would be upside to the backlog and profit forecasts, and would help extend the growth of operating results into 2027. As for WHAUP, the analyst gives a buy recommendation with a target price of 8.80 baht and expects profit in 2026 and 2027 to grow outstandingly and continuously, driven mainly by revenue and capacity revenue from the water business, especially the increase in water usage from Data Center customers, as well as the recovery of the Gheco-One power plant and rising power generation capacity from Solar projects. In addition, WHAUP stands to benefit further from the new Power Development Plan through selection for new power plant projects, as well as opportunities from Direct PPA projects. For the profit trend in the third quarter of 2026, it is expected to be flat from the previous quarter, supported by the share of profit from the Gheco-One power plant, where losses from the coal business are likely to narrow, while water usage tends to increase in line with demand from petrochemical customers, together with the recognition of power generation capacity from new Solar projects providing additional support.

Yuanta Securities (Thailand) said the government is drafting the 14th National Economic and Social Development Plan for 2028-2032, which will take effect from October 2027, aiming to restructure the Thai economy and reduce constraints that hinder growth, in order to push economic expansion above 3% per year and set a goal for Thailand to rank among the world's top 20 in competitiveness by 2029. The plan is driven through five key areas, covering raising production efficiency and attracting new industries, reforming public administration toward OECD standards, upgrading human capital to support an aging society, turning natural resources and the environment into development capital, and investing in technology and innovation. A key shift from the 13th plan is the move away from designating target industries toward addressing structural constraints, through five pillars: Transform, Reform, Upgrade, Sustain, and Transfer. Yuanta's research team sees industries with a chance to benefit, including AI and data centers, electrical infrastructure, smart grid and smart meter, automated production systems, proactive water management, and digital infrastructure. The five stock groups expected to benefit are power plants, commercial banks, telecommunications, electronics, and construction contractors and building materials. Stocks that stand to gain include GULF, GUNKUL, GPSC, SSP, SCB, KTB, ADVANC, TRUE, SMT, and EPG.