Microsoft Cloud Revenue Surges 27% While Meta Free Cash Flow Drops 91%

Big Tech earnings reveal diverging AI ROI: Microsoft posts strong cloud growth, while Alphabet, Meta, and Tesla face scrutiny over soaring capex and deteriorating cash flows.

Woofun AI reports that US tech giants are facing intensified market scrutiny regarding AI capital expenditure returns. Microsoft delivered fourth-quarter revenue of $90 billion, an 18% year-on-year increase, with Azure growing 43% and Copilot users surpassing 30 million, resulting in a positive market response despite $41 billion in quarterly capex.

In contrast, Alphabet reported Q2 revenue of $119.8 billion but saw free cash flow turn negative to -$5.9 billion amid a $44.9 billion capex surge. Meta’s free cash flow plummeted 91% to $784 million as costs rose 55%, while Tesla’s operating profit fell 57% to $398 million with negative free cash flow of -$1.092 billion. Apple and Amazon earnings are pending, with Nvidia reporting in August.