Meta's stock jumps, Microsoft stumbles after earnings surprise
Meta's stock shot up 9% after reporting a big 24% revenue boost in Q4 2025, powered by smarter AI-driven ads.
Meanwhile, Microsoft's shares dropped 10%, even though they beat earnings expectations and saw strong growth from their Azure AI cloud business.
Why does this matter?
Both tech giants are betting huge on AI and cloud.
Meta plans to ramp up spending—an 87% jump in capex—to keep its ad momentum going, while Microsoft is ramping up its investments, especially into Azure AI.
But investors are a bit uneasy about Microsoft's massive $250 billion OpenAI deal making up nearly half of its future commitments.
What's behind the moves?
For Meta, stronger ad targeting driven by AI and rising revenue are fueling optimism (and those rising expenses).
For Microsoft, it's all about growing demand for AI-powered cloud services—but some worry if those big bets will pay off as planned.