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MSFTartificial intelligenceearningscapital expenditure
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Related tickers and likely impact
MSFT
• NeutralMicrosoft
Relevance: medium
| Market | US stocks |
|---|---|
| Sector | Information Technology |
| Industry | Systems Software |
| Market cap | $3.9T |
| Close on 10/22/2026 | 521.08 |
| Change that session | -2.23% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
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Meta posted negative free cash flow of $2.12 billion in Q3 as capex of $34.91 billion, including finance-lease principal, exceeded its $32.79 billion in operating cash, the first negative quarter since 2012. Revenue rose 26% to $64.60 billion, above expectations of about $63.3 billion, but operating margin fell to 20% from 40% due to a $9.89 billion charge tied to an agreement with 52 state attorneys general over teen mental health. Long-term debt rose to $80.92 billion from $58.74 billion at the end of 2025, and Meta made no buybacks in the quarter versus $3.33 billion a year earlier. Meta narrowed its 2026 capex forecast to $135–145 billion and guided Q4 revenue to $73–76 billion, while its 2027 budget is still being developed. The article says the Q4 2026 report, expected in late January 2027, will be a key test, and a second negative free cash flow quarter or revenue below $73 billion would weaken the bullish case.
- Why SpaceX Stock Popped After Earnings
SpaceX shares rose about 9% by late morning Wednesday after the company reported Q3 earnings of $0.35 per share, more than double the $0.16 analysts expected. Total revenue jumped 161% to $14.6 billion, led by the Super Intelligence (SI) division, whose revenue rose 830% to $7.6 billion and which turned a $431 million profit. Connectivity revenue grew 69% to $5.2 billion and its profit rose 99% to $2.4 billion, while the Space division’s revenue rose just 6% and it swung to a $7 million loss. However, SI capital spending more than tripled to $16.4 billion in the quarter, bringing year-to-date capex to $48.1 billion, and cash burn of $35 billion is on course for $47 billion.
- Why Meta's Q3 earnings could be a little hard to interpret
Meta is reporting its third-quarter earnings after the market closes Wednesday, and Yahoo Finance's Brian Sozzi says the report will be hard to interpret. Recent good news on Meta's AI products, including new models and an AI agent, may not appear directly in the results but will likely be discussed on the earnings call. The key uncertainty is how investors will react if Meta raises its capex outlook again: it could be seen as fueling those products, or as overspending on offerings not yet reflected in financials. Sozzi expects the market to give Meta the benefit of the doubt on higher capex, as long as the increase does not shock investors.
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Meta (META) reports earnings on Wednesday after a run of positive product headlines, but Evercore ISI analyst Mark Mahaney warned the company may guide to capex and total expenses above Street estimates, making 2027 earnings forecasts likely to come down. His rough guess is total expense growth of about 40% in 2027 and capex dollar growth similar to 2026, or around $70 billion. Meta's new Muse Wonder and Muse Wonder Full models have drawn praise for their speed, and the stock has risen about 6% in the past month. Yorkville Ives' Dan Ives still considers Meta a core name to own, citing its 3.6 billion daily users.
- UBS Sees 40% Upside For AMZN Stock — AWS Margins Take Center Stage Ahead Of Earnings
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