Wall Street had very different reactions to two of Big Tech’s biggest spenders after quarterly earnings reports came out on Wednesday.
Both Meta and Microsoft reported higher-than-expected capex. While both companies beat revenue expectations, Microsoft’s stock sank more than 6% after-hours, while Meta’s stock jumped as high as 9%.
Big Tech’s spending has risen sharply in the last two years, driven by investments in massive AI data centers. Wall Street has started to question when those investments will pay off, and analysts are giving some companies a much harder time than others.
Meta reported capex of $22.1 billion for the fourth quarter and $72.2 billion for the year, up from 2024’s $39.2 billion. That number will climb in 2026 — the company estimates capex will be in the range of $115 billion to $135 billion for the year, driven by increased spending on Meta SuperIntelligence Labs, the company’s big bet on speeding up AI model development.
“We plan to continue to prioritize investing in the business to support these opportunities,” CFO Susan Li told investors on Wednesday’s call.
Microsoft logged $37.5 billion in capex for the quarter, up 66% from one year ago. Most of that spend went toward CPUs and GPUs, the powerful computing chips that run AI workloads. The company said the spending was necessary to support fast-growing demand for its cloud and AI business.
Microsoft’s revenue was 81.3 billion for the quarter, up 17% from the previous year. Meta reported $55.9 billion in revenue for the fourth quarter and $200.1 billion for all of 2025.
While both surpassed Wall Street’s revenue expectations, analysts gave Microsoft a much harder time than Meta over its surging capex.
Part of that could be Microsoft’s heavy investments in GPU chips, which can become costly given their short life spans.
Morgan Stanley’s Keith Weiss said that a core issue for investors, as Microsoft’s capex grows faster than they expected, “comes down to ROI on capex spend over time.”
Microsoft is also heavily exposed to a single customer, another concern for investors. Nearly half — 45% — of the company’s remaining performance obligations are attributed to OpenAI.
“There’s obviously concern about the durability,” Jeffries analyst Brent Thill said of the backlog.
Microsoft holds a $135 billion stake in OpenAI and has invested more than $13 billion into the company since 2019.
While OpenAI does not directly carry a heavy debt load, some of its partners, including Oracle, CoreWeave, and Nvidia, have taken on massive amounts of debt to fund data center buildouts, fueling Wall Street’s anxiety over a potential AI bubble.
Oracle is struggling to finance its $500 billion data center initiative, Business Insider reported last week, amid growing concerns about its credit rating and risk.
On the Meta earnings call, Li noted that Meta’s cash reserves, thanks to its very profitable ad business, will fuel its AI spending spree next year.
“We have a strong net cash balance, and expect our business will continue to generate sufficient cash to fund our infrastructure investments in 2026,” Li said.
