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Back in 1984, Wendy’s launched one of the most memorable TV commercials of all time.
Three elderly women examine a massive hamburger bun. But when the top is removed, they find a very small hamburger patty.
One of the women famously shouts, “Where’s the beef?”
Ever since then, “Where’s the beef?” has been a catchphrase for looking past the hype and finding the real substance underneath.
Interestingly, that’s exactly what I’ve done my entire career.
Every day, Wall Street is inundated with headlines, opinions and predictions. One day, it’s geopolitical tensions. The next, it’s interest-rate speculation, Federal Reserve policy, inflation or the latest market rotation.
But earnings season cuts through that noise. It shows us which companies are actually growing – and where the money is really flowing.
That’s why when earnings season rolls around, it’s my job to look past the distractions and answer one simple question: “Where’s the beef?”
Or said another way: Where is the real earnings growth?
Earnings announcement season is one of the most important times of the year for investors. It’s also my favorite time of year because opinions finally give way to facts.
And the facts are becoming increasingly clear.
We’re in the midst of one of the strongest earnings environments of my lifetime.
And artificial intelligence remains one of its biggest driving forces.
AI demand is spreading throughout the technology stack and into the physical infrastructure needed to support it – from processors and data storage to power generation and grid equipment.
And this week’s results from Advanced Micro Devices, Inc. (AMD) and SanDisk Corporation (SNDK) offer two important clues about how far that demand has spread.
In today’s Market 360, we’ll examine the strongest earnings growth in five years, what the latest results reveal about the AI buildout and why some of its biggest beneficiaries may sit outside the best-known chip and software stocks.
The Strongest Earnings Growth in Five Years
I don’t say “I told you so” very often. But for the past few weeks, I’ve noted that the S&P 500 was on track to achieve average earnings growth north of 30% in the second quarter.
Well, my forecast has already been proven right – and we’re only about halfway through earnings announcement season.
Our friends at FactSet recently reported that current estimates call for the S&P 500 to achieve average earnings growth of 47% in the second quarter. That’s up from estimates of 23.2% just last week and only 18.6% on March 27.
It’s simply stunning, folks.
So, what’s driving this spectacular earnings environment?
Artificial intelligence and the massive data center buildout are playing a major role.
As companies race to develop and deploy increasingly powerful AI models, they need more computing power, more storage capacity and more supporting infrastructure. That demand is producing accelerating sales, expanding order backlogs and spectacular earnings growth throughout the AI ecosystem.
This week, two very different semiconductor companies gave us another opportunity to look beneath the surface and see where AI demand is spreading next.
Two Earnings Reports Offer the Next Clue
Let’s start with the obvious part of the AI stack: semiconductors.
Advanced Micro Devices shares dipped lower on Tuesday afternoon despite the company’s better-than-expected quarterly results. Apparently, Wall Street wanted even stronger revenue growth.
But when we look beneath the stock’s initial reaction, the numbers reveal tremendous demand for AI computing power.
AMD’s data center revenue doubled year-over-year to a record $6.7 billion. The division now accounts for 58% of the company’s total revenue.
Overall revenue rose 50% year-over-year to $11.54 billion, topping estimates of $11.31 billion. It was AMD’s fifth-straight quarter of record revenue.
Second-quarter earnings surged 253% year-over-year to $2.76 billion, or $1.66 per share. Analysts expected earnings of $1.61 per share, so AMD posted a 3.1% earnings surprise.
And management expects data center revenue to accelerate further in the second half of 2026. For the third quarter, AMD anticipates revenue of approximately $13.0 billion, which would represent 41% year-over-year growth.
In other words, Wall Street may have wanted an even bigger quarter. But there is no mistaking where the beef was in AMD’s report.
It was in the data center.
And that same demand showed up in another critical layer of the AI technology stack: data storage.
SanDisk shares also pulled back sharply this morning despite reporting better-than-expected quarterly results. In this case, Wall Street appeared disappointed that the company’s revenue guidance was not even stronger.
But when we look beneath the stock’s initial reaction, the numbers reveal extraordinary demand for the data storage needed to support AI.
For fiscal year 2026, SanDisk reported that data center revenue grew 437% year-over-year to $5.15 billion, while edge revenue jumped 195% year-over-year to $12.16 billion.
For its fourth quarter in fiscal year 2026, total revenue soared 372% year-over-year to $8.97 billion, topping estimates of $8.39 billion. Earnings surged to $6.16 billion, or $39.25 per share. Analysts expected earnings of $34.51 per share, so SanDisk posted a 13.7% earnings surprise.
Looking ahead, SanDisk expects total revenue between $10.3 billion and $10.8 billion and earnings per share between $44 and $46.
SanDisk shares still pulled back after the report, as Wall Street appeared disappointed that guidance was not even stronger. But that a knee-jerk reaction, folks. The company’s first-quarter guidance still calls for revenue growth of 345.9% to 367.5% and earnings growth of more than 3,500%!
So, while AMD’s results underscored the demand for computing power, SanDisk’s report highlighted another critical piece of the AI buildout: storing the enormous volumes of data those systems create.
The AI Boom Reaches the Power Grid
The demand does not stop with processors and storage, though.
Consider GE Vernova Inc. (GEV), one of the world’s leading suppliers of power-generation and electrification equipment.
GE Vernova reported $24.2 billion in second-quarter orders, an 88% increase from the same quarter a year ago. Its total backlog expanded by another $13 billion during the quarter to reach $176 billion.
Data centers are becoming a significant part of that growth. Companies can order all the AI chips they want. But those chips are useless without enough electricity to run them and the grid equipment to deliver that power.
Bloom Energy Corporation (BE) offers another example.
Bloom builds on-site fuel cell systems that help data centers secure reliable power without waiting years for new transmission lines or grid upgrades.
Bloom’s second-quarter revenue surged 165.5% year-over-year to a record $1.07 billion, marking the company’s first billion-dollar quarter. Product revenue jumped 215.4%, while adjusted earnings rose to $0.78 per share from $0.10 a year ago.
Bloom entered 2026 with a backlog of approximately $20 billion, including about $6 billion in product orders and $14 billion in long-term service agreements.
The company only provides a specific backlog figure once a year, so we do not have an updated second-quarter total. But management said backlog is growing faster than revenue.
Together, GE Vernova and Bloom Energy show that the AI spending boom has reached the companies responsible for generating and delivering the electricity behind it.
For the record, we have held both of these names in my Growth Investor service for less than a year. GEV is up by about 63% and BE is up by 225%.
“Where’s the Beef?”
So, where’s the beef this earnings season?
I gave you just a few examples, but some of the strongest earnings growth is appearing across the entire AI buildout – from cloud computing, advanced processors and data storage to the power systems keeping it all running.
My Stock Grader system currently gives all four stocks a “Strong” or “Very Strong” Total Grade (subscription required).
But these companies only represent the current stage of the AI buildout.
Today’s best AI systems were designed primarily to generate text, images and code. But the federal government is now backing a new scientific-computing effort intended to tackle far more complex work in fields such as energy, medicine and quantum computing.
The project is taking shape across the Department of Energy’s national laboratory network, including the same Tennessee facility that played a central role in the original Manhattan Project.
That means it will require an enormous amount of computing power, data storage, networking equipment and electricity.
In other words, we’re just getting started, folks.
The earnings results we are seeing now show that the infrastructure race is already underway. The next question is which companies will capture the biggest share of the spending as this government-backed scientific AI system comes online.
That’s why I put together a special presentation explaining what I call the AI Reset. In it, I reveal the government project behind this shift, the companies helping to build it – and the stocks my system has identified as the best positioned to benefit.
I’ll also explain why this new system could change what AI is capable of doing – and why investors who focus only on today’s chatbot leaders may miss some of the biggest opportunities ahead.
The earnings tell us where the beef is today. My AI Reset presentation reveals where it may be headed next.
Sincerely,
Louis Navellier
Editor, Market 360
P.S. My new Stock Grader AI feature is now live – giving you a powerful new way to interact with the system.
You can search for stocks by sector, size, risk profile, grade trends and more, all using plain English. You’ll also receive weekly AI-powered insights highlighting the most important upgrades, downgrades and sector shifts.
Access to this tool is only available to my Preferred Members. If you’re a subscriber of Growth Investor and want to gain access to my new Stock Grader AI tool, learn more about upgrading to a Preferred Membership through this exclusive invitation.
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The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:
Advanced Micro Devices, Inc. (AMD), Bloom Energy Corporation (BE), GE Vernova Inc. (GEV) and SanDisk Corporation (SNDK)
