Microsoft shares fell in Europe on Thursday after it issued a downbeat forecast for its cloud business, while Facebook parent Meta shares rose after beating expectations, as investors scrutinised the companies' spending on artificial intelligence.

Microsoft on Wednesday forecast disappointing growth in its cloud computing business, sending its shares down 4.5% in after-hours trading as investors worry about big spending, elusive artificial intelligence revenue and competition from cheaper AI models from China.

AI revenue run rate reached $13 billion, as the company reported $69.6 billion in revenue for the December quarter, up 12%, with earnings of $3.23/share, topping Wall Street's expectations by both measures.

Microsoft’s cloud and AI businesses are doing pretty well — and their impact is being felt across the company. In its Q2 2025 earnings, Microsoft announced revenue of $69.6 billion for the quarter, up 12 percent year-over-year, and net income of $24.1 billion, which is up 10 percent year-over-year.

The tech giants on Wednesday talked up their AI strategies and said they are sticking with ambitious investments in the technology despite the investor panic this week over the ri

Microsoft reported that its flagship cloud computing business experienced a slowdown in growth amid constraints on data center supply.

The tech giant’s revenue was up 12 percent to $69.6 billion, but investors are showing their nerves after a long boom for tech stocks.

In its own research, DeepSeek said it had “distilled” models from its R1 system based on other open-source systems. Unlike OpenAI’s closed systems, some models such as Meta’s Llama are open-source and freely available for use.

Microsoft reported lower-than-expected revenue growth for its AI and cloud divisions as scrutiny grows over tech's AI investments.

Microsoft Corp. said Wednesday that its profit for the October-December quarter grew 10% from the same time last year as it works to capitalize on the huge amounts of money it has spent to advance its