Jim Cramer argues that Amazon (AMZN) and Alphabet (GOOGL) appear undervalued as investors favor other AI winners, noting his charitable trust holds both. The article highlights that while earnings multiples look attractive due to investment gains boosting the denominator, a critical distinction exists between reported earnings and actual free cash flow available after heavy infrastructure spending. Amazon reported strong second-quarter AWS sales of $42.2 billion, up 37%, with operating income climbing significantly to $16.6 billion from $10.2 billion. However, the company's June-quarter filing reveals a challenging cash picture where trailing twelve-month operating cash flow of $161.4 billion was nearly entirely consumed by $169 billion in property and equipment purchases, resulting in negative free cash flow of $7.6 billion. Alphabet presents a similar dynamic with Google Cloud revenue surging 82% to $24.8 billion and companywide operating income rising 30%. Despite this growth, Alphabet's quarterly capital expenditures of $44.9 billion exceeded its operating cash flow of $39.1 billion. The analysis warns that treating $98 billion in unrealized equity-investment gains as ordinary earnings would exaggerate the companies' apparent cheapness. Insider Monkey data shows funds increased exposure to Amazon and Alphabet ahead of Jim Cramer's commentary, with Fisher Asset Management raising positions in both stocks. While short interest for Amazon remains low at 0.97% of float, the investment thesis rests on future cash generation justifying current outlays rather than relying solely on low earnings multiples or rising cloud sales.