Microsoft Shares Rise 4.7% After Q1 Capital Expenditure Falls Short of Estimates

Microsoft reported Q1 2026 capital spending of $39.37 billion, below the $45.93 billion consensus. Revenue topped expectations at $92.28 billion versus $90.63 billion projected, and adjusted EPS hit $4.89 against a $4.73 estimate. The stock climbed to $555.33 in after‑hours trading, up 4.7% from the prior close. In contrast, Alphabet spent $51.4 billion and its shares fell 8% after hours. Microsoft’s CFO Amy Hood had previously forecasted spending above $50 billion, raising questions about whether the lower figure reflects a genuine pullback or an accounting change. The results were released shortly after Federal Reserve Chair Kevin Warsh cautioned that rate hikes could impact AI‑related borrowing costs, a concern for tech firms that have issued $230 billion in bonds this year.