Microsoft lowered its 2026 capital expenditure forecast to $170 billion from $175 billion, CFO Amy Hood said on the company's fiscal first-quarter earnings call Wednesday. Hood cited delays in third-party GPU-as-a-Service contracts expected to arrive in the second half of the fiscal year. She said Microsoft anticipates capex to accelerate once the delayed capacity arrives.
Azure cloud revenue climbed 48% to more than $33 billion, beating Wall Street expectations. Microsoft reported total fiscal first-quarter revenue of $92.3 billion, up 19% for the quarter ending Sept. 30. Microsoft shares rose about 3% in after-hours trading.
Microsoft headcount fell 2% during the first quarter. Earlier this week, the company offered buyouts to more than a quarter of its workforce, with CFO Hood stating the company expects at most 5% of eligible employees to accept.
The capex reduction marks a rare pullback in an industry that has steadily increased spending on AI infrastructure. Wall Street has grown increasingly concerned about the scale of cloud company investments in AI capacity and their returns on spending.