GOOGL, MSFT AI Capex Worries Hammer Neocloud Stocks: CRWV, NBIS, IREN, APLD Give Up Best Week in Over 2 Months

Key takeaways

• A capex miss by Microsoft and Alphabet has rattled AI infrastructure stocks, underscoring concerns about the pace and sustainability of hyperscaler spending.
• Microsoft capex $45.2 billion
• Alphabet capex $51.36 billion
• Microsoft capex 30% higher
  YoY

  Year over year — compared with the same period last year.

What happened

Microsoft Corp. and Alphabet Inc. reported quarterly capital spending that fell short of Wall Street expectations, with Microsoft spending $45.2 billion and Alphabet $51.36 billion, both below analyst averages of $50.7 billion and $55.09 billion respectively. The miss sparked a pre‑market sell‑off in AI infrastructure stocks, sending CoreWeave Inc. down 5%, Nebius Group NV 6%, IREN Ltd. 4% and Applied Digital Corp. 4%, erasing much of their recent weekly gains.

Why it matters

The two hyperscalers are the biggest buyers of AI data‑center capacity; their reduced spending signals a potential slowdown in demand for neocloud providers. Investors had been pricing in aggressive growth for these smaller firms, so the capex miss raises doubts about the sustainability of the AI‑driven…

Short-term and longer-term

Short-term. In the next few days, watch for any further updates from Microsoft or Alphabet on capex plans, as any additional cuts could push neocloud shares lower.

Longer-term. Over the coming months, the reduced capex could signal a shift in the AI infrastructure cycle, potentially leading to slower growth for neocloud providers.