Microsoft cuts capex forecast on AI capacity delays
CFO Amy Hood cited delays in third-party capacity as Wall Street scrutinizes returns on AI spending.
TL;DR
- Microsoft reduced its capital expenditure forecast for the 2026 calendar year to $170 billion from $175 billion.
- The reduction is attributed to delays in third-party AI capacity, including 'GPU-as-a-Service contracts'.
- These delays are likely related to broader issues such as a lack of electricity for AI data centers and local opposition.
- Microsoft's CFO expects capex to accelerate in the second half of its fiscal year as delayed capacity comes online.
- The company reported $92.3 billion in revenue for its fiscal first quarter, a 19% increase.
- Azure cloud revenue grew 48% to over $33 billion, surpassing expectations.
- Microsoft's shares rose approximately 3% in after-hours trading following the earnings call.
- The company also offered buyouts to over a quarter of its workforce, with an expectation that few will accept.