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Microsoft has announced a capital expenditure (CapEx) plan of $80 billion for the fiscal year, a significant figure that has generated varied interpretations among analysts. Some suggest that this level of spending could indicate flat CapEx for the next three quarters, following a $20 billion expenditure in the previous quarter. The year-over-year growth in CapEx was noted at 79% in the last quarter, raising questions about the company's future investment strategies. Analysts are considering the implications of this spending on both internal and external projects, as well as its potential impact on the broader U.S. equity market, particularly in relation to revenue forecasts from major players in the AI sector.
A thought-provoking chart that provides the bull and bear case for the U.S. equity market's premium valuation. Bull: Nvidia '25/'26 revenue forecast implies $400 billion of future AI revenue growth from the hyperscalers Bear: Hyperscalers' $400 billion revenue shortfall implies… https://t.co/HhxW1VrKqg
Microsoft indicating $80B of CapEx for the year could imply quarterly CapEx will be flat for the next 3 quarters after spending $20B last quarter. CapEx grew 79% year over year in the most recent quarter. Could be an indication that we're entering a different phase of investment https://t.co/DnZ04iN0lN
1) $MSFT blog about $80B this FY to build AI DCs was either very bearish or bullish. $80B is a big #. Headlines everywhere. But what if cons was $85B? Need context. Capex last Q (FQ1) was $20B. Wait it's flattish next 3 Q's?? Bearish!? But fin leases = $5.1B so PP&E = $14.9B. https://t.co/oRLaBkOxOt https://t.co/vVsb31ZrGt
