Microsoft has trimmed its capital expenditure forecast for the 2026 calendar year, lowering the projected figure by $5 billion to $170 billion down from an earlier expectation of $175 billion. The adjustment stands as a rare move within a technology sector where major players have largely continued to escalate outlays for massive artificial intelligence infrastructure investments.
Chief Financial Officer Amy Hood detailed the revised outlook on Wednesday during the company’s fiscal first-quarter earnings call. Hood explained that the adjustment stems from expected new capacity arriving from third parties, noting that certain GPU-as-a-Service contracts have experienced delays pushing them into the second half of the fiscal year.
The remarks point toward outside providers of AI cloud services utilizing Nvidia graphics processing units to power their platforms. Microsoft has formed partnerships with several external vendors to accommodate surging demand for artificial intelligence capabilities. Industrywide, recent data center project delays have frequently stemmed from electricity shortages and local community opposition.
Despite the near-term adjustment, Hood indicated that Microsoft anticipates capital expenditures to accelerate during the second half of the fiscal year as the delayed computing capacity finally comes online. Wall Street analysts have shown growing scrutiny toward the massive outlays cloud computing companies are dedicating to expanding AI infrastructure.
During the previous quarter, Microsoft maintained its spending projections unchanged, a notable position while rival cloud giants steadily raised their artificial intelligence expenditure forecasts. Alongside the capital outlook, Microsoft disclosed overall revenue of $92.3 billion for the fiscal first quarter ending Sept. 30, marking a 19% increase. Revenue for the Azure cloud division climbed 48% to exceed $33 billion, outperforming expectations from Wall Street.
In after-hours trading following the earnings call, Microsoft shares advanced by approximately 3%. Earlier in the week, the company extended a buyout offer to more than a quarter of its personnel. A company spokesperson stated Wednesday that management anticipates no more than 5% of eligible employees will accept the departure package. In an internal memo, Hood remarked that very few staff members are expected to select the offer due to prevailing growth opportunities across the organization. Microsoft’s overall headcount declined by 2% during the fiscal first quarter.
