Microsoft (MSFT) Cuts 2024 Capex Forecast to $170 Billion; Alphabet (GOOG) Holds at $195-$205 Billion

Microsoft (MSFT) and Alphabet (GOOG) reported capital expenditure (capex) figures below analyst expectations in their latest earnings reports. Microsoft lowered its 2024 capex forecast to $170 billion from $175 billion, while Alphabet maintained its guidance between $195 billion and $205 billion. The companies are scaling back growth projections amid delays and supply constraints despite ongoing AI infrastructure demand.

Microsoft's CFO, Amy Hood, noted delays in third-party graphics processing unit (GPU) capacity, pushing availability to the first half of 2027. Microsoft relies on neocloud providers like CoreWeave, IREN, and Nebius, whose shares fell following the reports. Alphabet's finance chief, Anat Ashkenazi, reported that outside computing power only became available late in the third quarter. Alphabet's shares declined about 10% in after-hours trading due to missed earnings, revenue targets, and over $9 billion in negative free cash flow.

This cautious capex outlook signals supply chain constraints that could affect AI infrastructure expansion plans. Investors will await Amazon's upcoming report for further clarity. Meta recently raised its capex guidance to $135 billion-$145 billion but also saw share price declines after negative free cash flow results. The delays among smaller neocloud providers and capital requirements amid rising interest rates add additional uncertainty to AI capacity growth.

These developments matter for ordinary investors as Microsoft’s lowered capex guidance and Alphabet’s capex hold reflect potential constraints in AI infrastructure growth, which may affect supply, costs, and innovation timelines in the competitive tech sector.