Main developments
Meta raised its forecast for capital expenditure in 2026 to $125bn-$145bn as it spends heavily on AI, sending its shares more than 6 per cent lower in after-hours trading.
Chief executive Mark Zuckerberg said the increase was because of higher component costs, “particularly memory pricing”.
Google’s net income surged 81 per cent, propelled by a strong performance in its search business and a 63 per cent jump in its cloud computing revenue. Its shares gained more than 6 per cent.
The company lifted its capex forecast for this year to as much as $190bn and said it would rise further in 2027.
Microsoft said capex would reach $190bn for the 2026 calendar year.
Its Azure cloud business reported a 40 per cent increase in revenue, helping to push Microsoft’s total sales to a record $82.9bn.
Amazon reported better than expected results, as growth in its cloud unit and retail operations topped forecasts. Its shares were almost 3 per cent higher.
Microsoft expects Azure cloud business to gather pace
Microsoft forecast an acceleration in the company’s Azure cloud business this year.
Chief financial officer Amy Hood said the unit was expected to grow 39 per cent to 40 per cent year on year in the June quarter on a constant currency basis, compared with 39 per cent in the quarter ending March.
She added Azure growth would moderately accelerate in the second half of the calendar year compared with the first half.
Microsoft forecasts $190bn in capital expenditure this year
Microsoft executives said capital expenditure would continue to rise in the second half of the year to reach $190bn by the end of December.
The guide was well above analyst expectations of about $152bn of spending for the year, according to Visible Alpha, and includes $25bn from the effect of higher component pricing.
Management told analysts the company was focused on delivering data centre capacity and working through supply-chain constraints limiting their Azure cloud business.
Microsoft is working to bring its data centres online and “make them revenue ready”, it said.