Microsoft plunges after big capex jump; Meta stock soars on larger 2026 plan

Wall Street reacted sharply after Meta and Microsoft reported quarterly earnings on Wednesday: both companies raised capital spending above expectations, with Meta's stock jumping as high as 9% after-hours and Microsoft's sinking more than 6%. Meta disclosed fourth-quarter capex of $22.1 billion and $72.2 billion for the year, up from $39.2 billion in 2024, and said it expects 2026 capex of $115 billion to $135 billion driven by increased spending on Meta SuperIntelligence Labs.

Meta CFO Susan Li told investors, "We plan to continue to prioritize investing in the business to support these opportunities," and added the company expects its profitable ad business and strong cash balance to fund infrastructure investments in 2026. Microsoft reported $37.5 billion in capex for the quarter, up 66% year over year, with most spending directed to CPUs and GPUs to support fast-growing demand for its cloud and AI business.

The company posted $81.3 billion in revenue for the quarter, up 17% from a year earlier. Analysts treated the two companies differently: while both beat revenue expectations, Morgan Stanley's Keith Weiss said investor concern "comes down to ROI on capex spend over time," and Jeffries' Brent Thill warned, "There's obviously concern about the durability," citing Microsoft’s exposure to OpenAI — nearly 45% of its remaining performance obligations.

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