US Stock Market Move | Microsoft Corporation (MSFT.US) fell more than 6% in pre-market trading. Capital expenditures hit an all-time high. AI "burning money" is scaring investors.

On Thursday, Microsoft Corporation (MSFT.US) fell more than 6% in pre-market trading, closing at $450.20. In the second quarter of fiscal year 2026, despite Microsoft Corporation (MSFT.US) revenue and profits exceeding Wall Street expectations, and overall cloud business revenue surpassing $500 billion for the first time, concerns were raised among investors about the slowing growth of Azure cloud service revenue and record capital expenditure, impacting the return on investment cycle for artificial intelligence (AI). The financial report showed that Microsoft Corporation's revenue in the second quarter reached $81 billion, a 17% year-on-year increase, surpassing market expectations by 1%; non-GAAP earnings per share (EPS) were $4.41, a 23% year-on-year increase, exceeding market expectations by 5%. The highly anticipated Azure cloud business grew by 38% at constant exchange rates, slightly above Wall Street's expectation of 37%. Despite strong core performance data, investors expressed concerns about Microsoft Corporation's escalating capital expenditure. Data showed that Microsoft Corporation's capital expenditure in the quarter reached a high of $37.5 billion, 9% higher than the market's general expectation. The market was originally hoping that such a large investment would lead to a significant acceleration in Azure growth rate, but current data did not immediately satisfy this high appetite. Goldman Sachs Group, Inc. believes that the negative market reaction to Microsoft Corporation's stock price primarily reflects investors' anxiety about consistently higher-than-expected capital expenditure for several quarters. The $37.5 billion expenditure in a single quarter (including financing leases) indicates that Microsoft Corporation is actively building AI infrastructure. However, this investment has not immediately translated into a corresponding jump in the Azure growth rate. Analysts suggest that this is actually a strategic choice for Microsoft Corporation. The company is prioritizing allocating valuable computing resources to strategic products such as Copilot and internal development projects, rather than solely pursuing short-term external revenue for Azure. Goldman Sachs Group, Inc. believes that this strategy will ultimately drive a more strategically significant positioning of AI across multiple levels of the technology stack and deliver better returns in the medium term.