Meta and Microsoft reporting for duty

But what did they say about AI and CapEx?

Two bellwether companies reported and everyone wants to know: how’s your CapEx, bros?

• Meta is cooking—no recession here. We see your Capex, and we’ll raise

• European regulators trade war continues to sew chaos and uncertainty, though

• Microsoft crushed it too. It’s data center guidance though was a bit . . . squirrelly?

• Checking in on Construction Momentum: what do the advance plans say?

• A coda on Robinhood: is the U/X too good for mere mortals?

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Meta and Microsoft reporting for duty

Two of the biggest, most important companies in the world reported yesterday, and the results were better than expected.

But for present purposes, Random Walk cares about one thing: what did they say about AI and CapEx? Are they spending a lot or not?

Meta is cooking

Facebook META 0.00%↑ exceeded estimates for both revenue and earnings, which is great, so far as it goes:

Meta ‘Q1’25

$16.6B in net income for the quarter.

Can’t really argue with that.

But, more importantly, Meta is not slowing its capex roll, one bit:

via The Transcript

Meta increased it’s CapEx forecast by $4-7B for the year to “support our AI efforts.”

It helps to generate $16B in profits per quarter, but you love to see it. And it would have been concerning if Meta said “actually, we’re going to conserve cash for a bit.” But, instead it’s full-steam ahead for AI Capex, which is all the Capex, so it matters.

I guess the Tarifpocalypse is averted, for now.

Incidentally, one headwind that Meta did flag is the the EU’s war on US tech, which will make a “materially worse user experience for European users and a significant impact to our European business.” Weirdly, there are very few outraged headlines about how European regulators are overturning the world order, and/or threatening to tip a fragile economy into a recession.

Microsoft is also cooking, but is more like mid-steam ahead

Microsoft MSFT 0.00%↑, for it’s part, also did a bang up job.