$CloudBigThree

AWS vs Azure vs Google Cloud: three hyperscalers, one earnings week, and why I'm not selling puts on any of them yet

Microsoft and Alphabet both report on Wednesday 28 October after the US close. Amazon follows on Thursday 29 October. The Fed decision also lands on the 28th. For those of us in Singapore, the numbers hit our screens between roughly 4am and 6am on the 29th and 30th.

AMZN is a core name in my sell-put book, and MSFT and GOOGL sit in my second tier. Instead of reviewing each one alone, I put the three side by side this time. Same business at the centre (renting cloud and AI compute), three very different stocks.

All prices below are Friday 16 October closes. Cloud numbers are for the quarter ended 30 June, which all three reported in late July.

1. THE CLOUD SCOREBOARD

Google Cloud

Revenue $24.8B, up 82% year on year (Q1 was 63%)

Operating income $8.8B, margin 35.6%

Backlog $514B

AWS

Revenue $42.2B, up 37%, the fastest pace in 18 quarters

Operating income $16.6B, margin about 39%

Backlog $496B

Azure

Growth 43% (40% the quarter before), now past $100B in annual revenue

Guided to about 45% in constant currency for the September quarter

Microsoft commercial RPO $678B, up 84%

Two things people miss here.

First, the base. Google's 82% looks like a blowout next to AWS's 37%, but in dollar terms the two added almost the same amount of new revenue versus a year ago: about $11.4B for AWS and about $11.1B for Google Cloud. AWS is still the bigger machine. Google is closing the gap on rate, not yet on size.

Second, comparability. Microsoft doesn't disclose Azure's dollar revenue or margin, and its $678B RPO covers all commercial contracts, not just Azure. So it isn't a like-for-like number against the Google and AWS backlogs. What we can say is that Google's backlog equals roughly 20 quarters of its current cloud revenue, while AWS's equals roughly 12.

2. THE SPENDING BILL

Alphabet spent $44.9B on capex in Q2, double the year before, and lifted its 2026 range to $195B to $205B (from $180B to $190B).

Amazon spent $54.2B in Q2 and $98.4B in the first half. Operating cash flow was strong at $161.4B over twelve months, up 33%, but trailing free cash flow came in at minus $7.6B. Amazon is the only one of the three that is cash-flow negative on a trailing basis right now.

Microsoft spent $41B in its June quarter including finance leases, up 69%. It still produced about $67B of trailing free cash flow on a 46.8% operating margin.

Alphabet sits between the two, with about $53B of trailing free cash flow even after the capex jump.

This is the real split between the three. All of them are spending at record levels. Microsoft and Alphabet are still funding it out of current cash flow. Amazon, for now, is not.

3. THE P/E TRAP

On trailing P/E, GOOGL looks cheapest at 17.1, AMZN at 20.1, and MSFT looks expensive at 29.5. That picture is misleading.

Alphabet's Q2 net income of $112.2B included a $99.0B net gain on equity securities, which added $6.26 to diluted EPS for the quarter. Amazon's Q2 net income of $62.6B included $53.4B of non-operating pre-tax income, which Amazon said came mainly from its Anthropic investment. These are mark-to-market gains, not cash, and they can reverse.

Look at forward P/E instead and the gap disappears: GOOGL 25.5, AMZN 26.6, MSFT 26.8. The market is paying almost exactly the same multiple for three very different cash profiles. That tells me the debate this week is less about valuation and more about whether the capex keeps converting into revenue.

4. THE CHARTS GOING INTO THE PRINT

Friday was ugly. The Nasdaq fell 2.14% on the day and 4.5% for the week. Hot CPI and PPI data pushed the 10-year yield back above 5%, CoreWeave dropped almost 12% on worries about its debt load, and chip stocks sold off across the board.

AMZN closed at $250.00, down 4.7% on the week

50-day $257.08 (price 2.8% below)

200-day $242.73 (price 3.0% above)

MSFT closed at $529.05, down 1.1% on the week

50-day $505.53 (price 4.7% above)

200-day $435.25 (price 21.6% above)

GOOGL closed at $340.59, down 3.1% on the week

50-day $344.58 (price 1.2% below)

200-day $340.90 (price 31 cents below)

Over 52 weeks GOOGL is up 35.7%, AMZN 16.0% and MSFT only 3.0%. Funny enough, the stock with the weakest year has the cleanest chart today, and the stock with the best year is sitting right on its 200-day.

5. HOW MY SELL-PUT RULES HANDLE THIS WEEK

Rule 1: no new puts inside 7 days of earnings.

That blackout starts 21 October for MSFT and GOOGL, and 22 October for AMZN. A 30 to 45 DTE put opened today would expire somewhere between late November and early December, so it would carry the earnings print. That is a no for all three. I'm not selling premium into a binary event, however fat the IV looks.

Rule 2: price must hold above the 200-day SMA.

MSFT passes easily. AMZN passes with 3% to spare. GOOGL fails today by 31 cents. Even after earnings, I need a close back above the 200-day before I touch it.

Rule 3: IV gates (IV Rank 40 or higher, IV Percentile 45 or higher, IV over HV at 1.20 or higher).

I only check these after the print. Pre-earnings IV is full of event premium that gets crushed the morning after, so any reading today is not the number I would trade off.

Rule 4: Two-Anchor strike. I take the lower of the one-standard-deviation floor and the nearest SMA below price times 0.98.

SMA anchors as of Friday:

AMZN 200-day x 0.98 = about $237.9

MSFT 50-day x 0.98 = about $495.4

GOOGL no anchor, price is below both averages

The 1SD side needs post-earnings IV, so the final strikes will be worked out after the print. Delta still has to land between 0.15 and 0.25.

Sizing stays the same: up to 5% for AMZN as a Tier 1 name, 2% each for MSFT and GOOGL. 50% profit close on a GTC order, one roll maximum.

MY POST-EARNINGS ORDER OF PREFERENCE (for selling puts, not a stock pick)

1. MSFT. Only one of the three above both averages, highest margin, positive free cash flow, and the most room to the 200-day if the print disappoints. The watch item is whether Azure comes in around the 45% guide.

2. AMZN. Tier 1 for me and above the 200-day, but the negative free cash flow and the capex path are what the market will grill. Q3 guidance was $22.5B to $26.5B of operating income. I want to see where it lands in that range and what they say about 2027 spending.

3. GOOGL. Best cloud momentum of the three by far, and the worst chart setup for my rules right now. If it reclaims the 200-day after earnings, it goes straight back on the list. If it doesn't, I wait. Being early on a great business is still being early.

This is exactly why I compare names inside the same theme. The cloud story is strong across all three, but the trade setup is completely different for each. The business tells me what to own. The chart and the calendar tell me when.

What is your read? Does Google Cloud's 82% justify paying the same multiple as Microsoft, or does Amazon's free cash flow worry you more going into Thursday?

$AMZN $MSFT $GOOGL

Not financial advice. These are my own rules and my own positions. Do your own homework and size for your own risk.