At least in the case of Google, the pace of their buildout is very nearly being matched by the growth of Cloud consumption (and related contracts with companies like Anthropic & OAI). Cloud had >100% y/y growth this quarter to >$30b rev. That's insane, and it's quite profitable. But consumption revenue is always a lagging indicator of capital investment, and it just so happens that this business cycle is demanding a scale of capex heretofore unimaginable. Institutional investors seem to have been happier with business as usual (big annual stock buy-backs, predictable cloud/ads/youtube growth in the high-20% range, EPS in the $5-9/share/qtr range, and an enormous pile of cash). This is the first time since 2004 where buying GOOG really feels like placing a bet rather than buying a blue-chip. To that point, this is also why GOOG has been treated like an AI company for the past 18mo or so, rather than a media & infrastructure company, and what justified the dramatic increase in it's P/E.
Taking a longer view, I have confidence things will work out well and this dip is a great buying opportunity, but I can also understand why the market several reasons to be skittish.
Taking a longer view, I have confidence things will work out well and this dip is a great buying opportunity, but I can also understand why the market several reasons to be skittish.