Sell-side on Mag-7 names (Alphabet and Microsoft) post-earnings: GOOGL sees PT's lowered, while MSFT sees them lifted

• BMO lowers PT to USD 425 (prev. 480) and reiterates 'Outperform' rating and Top Pick; said while Search revenue was soft, Search queries grew at the fastest Y/Y rate in 5 years, as Co. expands AI Mode globally and underscores BMO's belief that most AI Mode searches are incremental. BMO adds, importantly, token consumption of GOOGL's models accelerated sequentially to 32bln tokens processed per minute, suggesting core AI adoption remains robust.
• Truist lowers PT to USD 410 (prev. 420) and maintains 'Buy'; said results fuelled by 103% Y/Y growth in Cloud show the positive impact of the AI investments management has been making and of the full-stack-strategy it's been pursuing. Adds TPU systems' inventory build-up and 3P capacity utilisation for cloud are likely to pressure near-term margins in Q4 & FY27 before TPU sales start scaling materially in FY27 & beyond, fuelling revenue growth and margin expansion over time.
• KeyBanc lowers PT to USD 385 (prev. 410) and maintains 'Overweight' rating; said Alphabet's Q3 results reinforced concerns KeyBanc had heading into the print, namely Search is decelerating and margins have peaked near-term. Adds it could create an air pocket over the next 1-2 quarters as investors await signs of whether this is transitory or structural.

• Bernstein raises PT to USD 722 (prev. 662) and maintains 'Outperform' rating; gave the usual commentary about the strong results and guidance, but said while the results were solid believes the lower-than-expected capex and delays in capacity this quarter and for H2 created some unwarranted noise.
• UBS raises PT to USD 700 (prev. 675) and maintains 'Buy' rating; despite high expectations into the print, Co. delivered a solid beat, marked by an Azure beat, reaffirmed CY26 capex guide excl. impact of a 3P capacity delay, and total revs/EPS actuals and guide that landed above UBS's estimates. UBS adds given that OpenAI is now 30%+ of Azure revenues, Azure growth could be more variable depending on large lab customer growth.
• Citi raises PT to USD 680 and reiterates 'Buy' rating; said Cos. strong results demonstrated AI tailwinds across multiple fronts with broad-based upside across Azure, and strength in Copilot/M365. The results demonstrate MSFT's core business is benefitting as enterprise customers increasingly move AI into production. MSFT continued to show strong profitability and disciplined spending even as capex moves higher in H2 on the back of stronger demand. After a strong outlook on both top/bottom lines, Citi raises its estimates now projecting a 3pts faster Azure growth CAGR.
• Stifel raises PT to USD 650 (prev. 575) and reiterates 'Buy' rating; Azure and M365 acceleration set to continue.
• KeyBanc raises PT to USD 630 (prev. 600); said Q1 positive on all fronts and the three key areas that KeyBanc is focused on all showed meaningful upside, and the momentum in those areas is expected to continue for the remainder of the year.

Post-earnings sell-side rounds of this kind usually matter less for the headline rating, which is often sticky, than for whether price targets and estimates move in the same direction as the debate; here the split is clean, with Alphabet targets cut while Outperform/Buy/Overweight stances largely hold and Microsoft targets lifted on a broadly intact bull case. That pattern has historically separated a valuation and timing reset from a thesis break: maintained ratings with lower targets tend to flag near-term margin, search deceleration or capacity digestion questions, while target raises after a cloud beat tend to validate AI demand but raise the bar for the next print. The transmission channel is estimate-revision breadth and target dispersion across the megacap complex rather than any one note, with Nasdaq and S&P megacap leadership sensitive to whether cuts remain contained to one name or migrate across the AI capex chain. The evidence cited on each side is different: Alphabet bulls point to query growth, cloud growth and token consumption against softer search and margin-peak concerns, while Microsoft notes centre on Azure, Copilot/M365 and capex timing, with an explicit flag that dependence on a large AI lab customer makes Azure growth more variable. Follow-ons that typically decide whether this fades or compounds are subsequent downgrades rather than target tweaks, revisions to cloud backlog and capex guidance, and any read-across to peers exposed to the same AI infrastructure spend. As an analyst-ratings event rather than new company information, the signal is about positioning around an already-repriced earnings debate.