Meta Soars, Microsoft Slips on AI Spending as Market Rewards Growth, Punishes Risk

Meta (META) surged 11% post-earnings while Microsoft (MSFT) fell 6.5% despite both beating estimates — investors rewarded Meta’s accelerating revenue and clear AI-ad monetization, but punished Microsoft’s exposure to OpenAI and slowing Azure growth. Meta’s Q4 revenue rose 24%, with Q1 guidance up to 33% growth, justifying its $125B AI capex forecast (+73% YoY). CEO Zuckerberg cited AI-driven ad efficiency and “compounding effects” toward superintelligence. Tesla (TSLA), also hiking spending to $20B+, rose 2.2% on strong earnings. Microsoft warned Azure growth slowed due to GPU allocation for internal R&D; CFO Amy Hood said external growth could exceed 40% with full chip deployment. OpenAI now represents 45% of Microsoft’s unfulfilled orders — a concentration risk as rivals like Anthropic gain traction. Analysts question if massive AI investments will yield sufficient ROI.