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Microsoft shares jump 14% as Mark Zuckerberg acknowledges Meta's ongoing AI investment costs.

Microsoft shares rose 14% on Thursday following a strong fiscal fourth-quarter revenue report that beat analyst estimates. The company reported 43% growth in its Azure cloud business and significant adoption of its Microsoft 365 Copilot AI assistant. Investors responded positively to the company's steady capital expenditure forecast, signaling that its $190 billion data-center buildout is beginning to deliver returns. In contrast, Meta Platforms shares fell 9% as Mark Zuckerberg reported that the company is still heavily investing in AI, which has caused free cash flow to plunge 91% year-on-year. While Meta's advertising business grew by 27%, investors expressed concern over the high costs of AI infrastructure. Mark Zuckerberg noted that while many AI use cases are currently for developers, building for consumers is a massive market opportunity. Analysts suggest that Meta must demonstrate more direct and measurable returns on its AI spending to satisfy investor patience.

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