Yesterday, two of the biggest tech giants in the AI boom reported their latest earnings. Google parent company Alphabet Inc. (Nasdaq: GOOG) and Facebook owner Meta Platforms, Inc. (Nasdaq: META) posted Q1 2026 results with some striking similarities, including a surge in capital expenditures (capex) and strong revenue growth.  But this morning, Meta’s stock is plunging, while Google’s is jumping. Here’s why. Google’s Q1 results give investors confidence in its AI strategy The way investors are reacting so differently to the two AI giants’ earnings results this morning makes the quarterly reports feel like A Tale of Two Cities, sorry, Tech Giants. For Google, it seems like the best of times, and for Meta, not so much. Yesterday, Google reported that for its most recent quarter, it achieved $109.9 billion in revenue, an increase of 22% and a record for the company. On top of that, the company reported an earnings per share (EPS) of $5.11, an increase of 82%. Google’s Search revenue also climbed 19%. This is particularly notable because many industry watchers have long debated whether the rise of chatbots will eat into the business models of traditional search engines. But that doesn’t seem to be happening—at least not for Google. And part of that may be down to Google surfacing AI search summaries at the top of its search results, which may be helping to maintain user engagement. Either way, AI is without a doubt why investors are rewarding Google’s stock price so much today. The main driver behind Google’s surging record revenue haul was the company’s cloud business. The Google Cloud division brought in $20 billion in revenue alone for the quarter, representing a staggering 63% increase. The Google Cloud Platform (GCP) primarily serves large enterprise customers by providing cloud compute infrastructure for artificial intelligence. Moreover, Alphabet said that its Google Cloud revenue was only constrained because GCP was constrained by compute capabilities (ie: it needs to keep building out more data centers to meet demand). The company says it currently has a Google Cloud backlog of over $460 billion in business. To better capture this AI-driven business in the future, Alphabet announced it would increase its full-year capital expenditure range. As noted by CNBC, Alphabet now expects its 2026 capex to increase from between $175 billion to $185 billion to a range of $180 billion to $190 billion. Yet despite adding to its already massive capital expenditure, the company’s stock price is still jumping this morning, currently up around 8% in premarket trading. But why? The answer is simple: Google may be spending a ton of money on building out its AI infrastructure, but the company’s current quarterly results show investors that the search giant is already benefiting massively from its AI expenditures. Meta, on the other hand… Investors are leery of Meta’s AI spend There’s no denying that Meta reported some very solid figures in its Q1 2026 earnings. Total revenue was $56.3 billion, a massive 33% increase from the same quarter a year earlier. The company also reported earnings per share (EPS) of $10.44, significantly higher than the $6.79 that LSEG analysts had expected, CNBC noted . Of course, that EPS was helped by $8 billion in tax breaks from the Trump administration, so its actual EPS without those breaks would have been less, at around $7.31. Still, that’s higher than analysts had hoped. And, like Google, Meta also reported that it would increase its capital expenditure for fiscal 2026 in order to better build out its AI infrastructure (primarily through the development of more data centers). Meta said its capex for the year will now be between $125 billion and $145 billion, up from a range of $115 billion to $135 billion. Yet despite the surging revenue and a lower planned capex than Google, Meta’s stock is falling this morning, currently down around 9% in premarket trading. But why? The biggest factor here seems to be that, as they have shown with Google, investors don’t seem to mind hundreds of billions in AI capex spend—as long as they can start seeing some positive results from it. While the bulk of Alphabet’s surging revenue came from its AI-focused cloud division, which shows the company is benefiting from its AI data center spending, the primary driver of Meta’s Q1 revenue increase was its legacy ad business. To be sure, that increased ad revenue is nothing to sneeze at—more money is more money. But investors may feel that Meta’s expensive AI buildout has yet to begin paying off in any meaningful way. That may be all the more disappointing to investors when you consider that Meta has been doing everything it can to shift its resources to AI—and not just by building out data centers. The company has recently instituted thousands of layoffs to reduce its labor costs and increase spending in other areas, such as AI. At the same time, Meta has also made headlines over the past year for spending massively on hiring individual AI talent. Sam Altman, who leads Meta competitor OpenAI, has alleged that Meta was offering bonuses of up to $100 million to poach individual AI experts. Those headlines have not helped calm investor worries that Meta is shoveling money into an AI buildout, yet so far, it has little bottom-line benefit to show for it. There is one clear winner between META and GOOG stock in 2026 Given that Alphabet appears to be showing more tangible financial benefits from its AI spend, it’s little wonder that investors are cheering the former’s stock this morning, while punishing the latter’s. As of this writing in premarket trading, GOOG shares are currently up nearly 8% to around $375 per share. META shares, on the other hand, are currently down by around 9% to $607.50 per share. Google’s share price surge this morning puts the company firmly in the green for the year, while Meta’s drop solidifies its plunge into the red. Even before today’s stock price change, GOOG shares were up more than 10% year to date, as of yesterday’s close. Meta’s shares, by contrast, were up only 1.3% in the same timeframe. Before today’s stock price fall, over the past 12 months, Meta’s shares had risen by over 20%. Still, that was significantly behind Alphabet’s stock price rise of more than 114% during the same period. During the same timeframe, the tech-heavy Nasdaq has increased nearly 40%.