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There’s no doubt that artificial intelligence spending – the hundreds of billions of dollars that top companies are doling out for servers, connectivity, data centers, and cooling systems – is making investors nervous. The most recent example was Alphabet (GOOG) (GOOGL), which issued a great earnings report on July 22, increased its capex forecast by $15 billion to $205 billion, and promptly saw its shares drop 6% the next day.
Will Microsoft (MSFT) suffer the same fate when it reports earnings for its fiscal fourth quarter on July 29? Analysts at BNP Paribas are already projecting that Microsoft will spend a whopping $262 billion on capital expenditures in its 2027 fiscal year. That marks a huge increase from fiscal 2026, in which Microsoft spent only $104.3 billion in the first three quarters.
