The Earnings Verdict Is In — And So Is July

Alphabet reported earnings last week. The China AI threat that drove GOOW’s extraordinary July spike has its first real answer. And July is closing out with a portfolio picture that is more subtle than any single headline suggests.

 This week we have four things to cover. The Alphabet earnings results and what they mean for GOOW going forward. An update on MSTW and where Bitcoin needs to go from here. A frank look at GDXW after four weeks of July data that tell a different story than the week two spike suggested. And where July is landing for the full portfolio.

 None of it is black and white. That is what real income investing looks like.

 Let’s get into it.

In Issue #12 we made a specific prediction. We said GOOW distributions would settle somewhere in the $50-70 range once the earnings proximity premium and China AI spike faded. We said the $89.41 week two number was almost certainly not the new baseline. And we said Alphabet’s earnings report would be the most important near-term data point for this position.

 The earnings report came in last Wednesday. Here is what Alphabet actually reported for Q2 2026:

 • Revenue: $119.8 billion — up 24% year over year, beating expectations of $116.9 billion
• Google Search revenue: $63.3 billion — up 17%
• Google Cloud revenue: $24.8 billion — up 82%
• YouTube advertising: $11.1 billion — up 13%
• Net income: $112.1 billion

Those are extraordinary numbers by any measure. Search grew 17% — not the collapse that China AI competition fears implied. Cloud surged 82% driven by enterprise AI demand. YouTube advertising grew 13%. Alphabet delivered its 12th consecutive quarter of double-digit revenue growth.

 The China AI threat did not show up in the Q2 numbers. Google’s core business is not being disrupted — at least not yet. The options market has now digested that reality.

 Here is what happened to our GOOW distributions across all four weeks of July:

 The pattern is exactly what we described in Issue #12. The spike fades week by week as the specific catalysts — earnings proximity, peak China AI fear — get resolved. Week four at $49.68 is still more than double the week one baseline of $21.56. That elevated baseline is real and meaningful.

 Our prediction of a $50 -70 new range was close but slightly high. Week four came in just below $50, suggesting the post-earnings new baseline may settle in the $45-60 range going forward rather than $50 -70. We will have more clarity once we see a few more weeks of data in August.

The strong earnings answered the most bearish scenario — that China AI competition was already materially damaging Google’s business. It is not. But the market also punished the stock in after-hours trading because of one concerning detail. Alphabet raised its full-year capital expenditure guidance to $195-205 billion and reported negative free cash flow of $5.9 billion for the quarter. The company is spending aggressively on AI infrastructure — more than it is generating in free cash.

 That tension — strong core business, massive AI spending, uncertain return on that investment — is exactly the kind of unresolved uncertainty that keeps Alphabet’s implied volatility elevated. It is not the same volatility driver as earnings proximity. But it is a real and ongoing source of options market uncertainty that should support GOOW distributions at a meaningfully higher level than the pre-July baseline.

 Our assessment: GOOW is earning its place in the portfolio at a higher baseline than we expected three months ago. The spike is gone. The elevated baseline remains. 144 shares. Holding.