Megacap Earnings Done, OpenAI Scare Bought, More Earnings Ahead
Weekly Outlook 05/04/26
Market Recap
Last week we left off asking whether the hyperscalers would reinforce the AI capex story Intel had just confirmed, or whether the rally would narrow further into a handful of semi names. We also flagged semis as short-term overextended and were watching for a short trade into continued overextension, expecting a pullback overall, which played out.
Digestion started on cue Monday, with semis fading off the open as the parabolic move finally caught up with price. Then Tuesday morning the Wall Street Journal reported that OpenAI had missed its own revenue and user growth targets, with CFO Sarah Friar reportedly raising internal concerns about the company’s ability to fund its compute contracts. The market gapped down, semis took the brunt of it, and for a few hours it looked like the deeper digestion everyone was waiting for had finally arrived.
By the cash open the move had largely completed. Sam Altman publicly refuted the report later in the session, the bid came back into semis, and the tape went vertical for the rest of the week. SOXX closed Friday at a new all-time high. The pullback we wanted lasted roughly 2 days. SPX and NDX both printed fresh highs, VIX stayed suppressed throughout.
The hyperscaler gauntlet was the other half of the story and the reaction was mixed. . Total hyperscaler AI capex for 2026 is now tracking toward $700 billion, but the market did not reward the spending in aggregate. It rewarded spending tied to clear near-term monetization. Alphabet ripped on a print that paired aggressive capex with visible cloud and search revenue acceleration. Meta sold off hard as guidance pushed capex higher without a tangible revenue offset. Microsoft saw modest weakness on the same theme. Apple and Amazon were mixed.
With the megacaps now through the gauntlet, the biggest binary risk of earnings season is behind us. Plenty of reports still to come this week, so the landmines are not gone, but the heaviest weight on the index has lifted.
Catalysts Over the Last Week
As always, the activity feed inside the Valhalla Portal has been logging every major catalyst I’ve flagged throughout the week. Screenshot from this week below, full feed is live in the Portal.
OpenAI / WSJ | Wall Street Journal reported Monday afternoon that OpenAI missed key revenue and user targets in its high-stakes sprint toward IPO. Triggered a Tuesday gap down across semis and the broader tape. Sam Altman publicly refuted the report, the pullback completed by the cash open, and SOXX went on to close the week at a new ATH. Adding weight to the story, MSFT was reported to no longer be paying a revenue share to OpenAI.
$GOOGL | Cleanest hyperscaler print of the week. Stock climbed after Q1 EPS blew past estimates, with capex paired against visible cloud and search revenue acceleration. The market’s template for what AI spending should look like.
$META | Sold off hard. Capex guidance pushed higher without a near-term revenue offset to anchor the spend. The clearest example this week of capex without monetization getting punished.
FOMC | The Fed held rates steady. Powell announced he will stay on the Board of Governors beyond his May 15 chair term expiry until the HQ renovation investigation concludes. Senate Banking Committee advanced Kevin Warsh’s Fed chair nomination along party lines. Leadership transition story now in motion.
$LLY | Eli Lilly Q1 was a blowout. Revenue $19.80B vs $17.77B estimate (+56% YoY), adjusted EPS $8.55 vs $7.06 (+156%). Reaffirms the GLP-1 cash machine thesis.
$CRML | Announced the acquisition of European Lithium for $835M. Critical minerals theme back on the radar.
$BE | Bloom Energy reported record Q1 results and raised full year 2026 guidance. Followed up by news that Oracle will now power its Project Jupiter campus in New Mexico with up to 2.45 GW of Bloom fuel cells. Direct hyperscaler-to-fuel-cell pipeline confirmation.
$RDDT | Reddit reported a 69% jump in revenue, topping analyst estimates.
$ROKU / $TWLO / $TEAM | All three raised annual revenue forecasts on Thursday, with Atlassian and Twilio specifically calling out AI-driven enterprise demand. Software AI monetization showing up in guides.
$SNDK | Q3 was a blowout earnings report.
$NBIS | Agreed to acquire Eigen AI on Friday, strengthening Nebius Token Factory as a frontier inference platform. Vertical integration play in the AI infra stack.
Watchlist
Earnings season rolls on. The megacaps are through, but the calendar this week is loaded with names from across my watchlist and the broader growth complex. The names I am watching most closely:
AI Infrastructure / Networking
$ANET, $ALAB, $LITE, $COHR, $AAOI
Semis
$AMD, $ARM, $ON, $NVTS
Datacenters
$CRWV, $IREN, $HUT, $WULF
Software AI
$PLTR, $FSLY
Others
$COIN, $SOUN, $IONQ, $BWXT, $RKLB
IWM looks ready to make a second leg out of its recent consolidation. If it confirms, that is a green light for small and midcap growth and the more speculative themes that have been waiting on broader risk appetite to come back online.
Data Centers
Last week we flagged $NBIS at the $140 area and $CRWV at $100 as the cleaner first-pullback setups in the group. Both bounced from those levels and finished the week strong, exactly how the setup was supposed to play out.
$CRWV | Bounced from $100. Reports this week, the print will set the tone for the group.
$NBIS | Bounced from $140. Reports next week, with the Eigen AI acquisition adding to the story.
$RIOT | Reported this week but no follow-through on Friday. On the radar but waiting on price to confirm before doing anything.
Post Earnings Strength
Semis
$QCOM | Reported, holding up well.
SIMO MRAM
Software
Three names that lifted full year guides on AI-driven enterprise demand and got rewarded. Watching for follow-through.
$TEAM | Atlassian lifted annual revenue forecast on AI features and enterprise sales boost.
$TWLO | Raised annual revenue growth forecast on AI-driven demand, breaking out of a big stage 1 base.
$ROKU | Raised annual platform revenue forecast.
Rare Earths
Critical minerals back in focus after the $CRML acquisition of European Lithium for $835M. Group tends to move together, IWM strength would give the smaller names room to run.
$UAMY, $CRML, $USAR, $MP
Memory
The entire memory group had major beats this earnings cycle and remains one of the leading areas in the market. These names should be on permawatch given their continued strength and ongoing all-time highs.
$SNDK | Blowout earnings, dipped to $1000 and into new all time highs. As one of the leading and best performing momentum stocks in the market for the past year it’s hard to see this topping out without parabolic action.
WDC STX MU rest of the group remain strong and trading in tandem
Others
$GME | WSJ reported Friday that GameStop is preparing a takeover bid for eBay, with Ryan Cohen building a position in the name and planning to make an offer this month. eBay shares jumped more than 10% on the news. If GME catches momentum on this, it has the meme heritage to be interesting. On the radar if it gets going.
Closing Thoughts
The potential pullback on semis from last week showed up, lasted two days, and got bought aggressively. When a market refuses to give you the deeper retracement everyone is positioned for, that is information about who is in control of the tape.
With the megacaps earnings past a clearing event, the market looks sets up to continue higher from here. The job now is to ride what is already working. Memory is leading, semis are back at highs, the data center pullbacks did exactly what they were supposed to do, and post-earnings strength names are setting up cleanly. If IWM confirms its second leg out of consolidation, the small and midcap growth complex opens up as the next area to lean into. Plenty of opportunity ahead, the focus is staying selective and pressing the names that have already proven themselves through the print.
If you enjoyed this read, please consider leaving a like on the post, and let me know in the comments if I missed anything or what you’re watching for this week!
P.S.
If you haven’t checked out the Valhalla Portal yet, it’s where I track catalysts, setups, and market activity in real time - a live feed of everything that moves the tape, built for the community. I’ll be doing a dedicated post soon walking through all the features in detail, so stay tuned for that. In the meantime, you can check it out here: