tech
Meta and Microsoft report ballooning AI expenses
AI hyperscalers are rushing to bolster computing power, but it's making some investors nervous.
TL;DR
- Microsoft and Meta reported increased AI costs, impacting their financial results differently.
- Meta's expenses rose 55% to $42 billion, with net income falling 14% to $15.8 billion, missing projections.
- Microsoft's capital expenditures increased by 70% to $41 billion to support cloud and AI demand, yet net income grew 31% to $35.8 billion, exceeding expectations.
- Meta raised its 2026 capital expenditure forecast to $130-$145 billion.
- Microsoft noted that about two-thirds of its capital expenditures are for short-lived assets like CPUs and GPUs.