Big tech earnings are in focus this week, with giants like Amazon (AMZN) and Microsoft (MSFT) set to report. Investors are keenly watching to see how AI spending will impact company revenues. Neuberger Berman senior research Analyst Daniel Flax joins Market Domination to discuss his outlook.

Flax believes that upcoming tech earnings will highlight "the buildout of the cloud infrastructure" and AI. With Amazon and Microsoft earnings on the horizon, he notes, "I expect they'll see strong growth" within Azure and Amazon Web Services. He points out that the cloud businesses among tech giants are generating substantial revenues, arguing that "this need to invest, I think, is the right strategy," despite acknowledging that revenue generation from AI specifically will take time.

"I do think the investments or the capital expenditures are a necessary part of it. I expect you'll see incremental revenues from these newer areas over the next 12-24 months. The key though... these are very healthy businesses for these companies," Flax told Yahoo Finance.

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This post was written by Angel Smith