Oy vey! Microsoft (MSFT 0.74%). Last week? A catastrophe! Down 11% on Thursday. That’s like losing your entire pickle barrel! The biggest one-day drop since… well, since before everyone had a computer, practically. It bounced back a smidge, but only enough to make the shpilkes a little less painful. So, what happened? Let’s dissect this, shall we? I’ve been trading longer than some of these tech CEOs have been alive, and let me tell you, it’s always about the numbers…and the expectations. Always the expectations!
They released their quarterly results, and on paper? Beautiful! Revenue up 17%, earnings per share up 60%! It’s like a Yiddish mama’s cooking – generous portions! Operating income? A whopping 21% increase. Wall Street should have been throwing confetti! But… (there’s always a “but,” isn’t there?) They looked past the bagels and latkes and focused on…spending. Spending! Like a teenage son with a credit card!
Cloudy with a Chance of Disappointment
Capital expenditures went up 66%! Sixty-six percent! That’s enough to build a whole new shtetl! A massive $37.5 billion! And cloud revenue, specifically from Azure, grew 38%. Now, 38% sounds good, right? It’s like getting 38 compliments on your new hat. But it barely met expectations. Barely! And the growth rate slowed down from the previous quarter. It’s like a slow dance when you’re expecting a hora. And the outlook for the current quarter? A measly 37% to 38%. Wall Street wanted more! They wanted a geyser of growth, not a leaky faucet!
So, investors saw all this spending and thought, “Where’s the payoff?” They wanted a return on investment, a golden goose, not just a lot of fancy data centers. Hence, the plunge. It’s simple economics, folks. Or, as my bubbe used to say, “You can’t make a living from promises.”
The Magnificent Seven and the Mania
Look, it’s all about AI, darling! Everyone’s obsessed! The Magnificent Seven tech stocks are soaring, and Wall Street is throwing money at them like it’s going out of style. Billions are being pumped into AI data centers, research, and infrastructure. But Wall Street is impatient. They want results now. They want to see the profits roll in before their dentures fall out.
And the competition? Fierce! Like two mothers arguing over who makes the best chicken soup. That’s why Meta Platforms (META 2.96%) surged. They raised their guidance. They promised more, and Wall Street loves promises. Microsoft didn’t. Simple as that. It’s a zero-sum game, people! A beautiful, chaotic, money-grabbing zero-sum game.
Earnings, my friends, are everything. Beat expectations, and you’re a hero. Miss them, and you’re…well, you’re Microsoft on Thursday. In this AI-fueled mania, these companies have to keep exceeding expectations, or their share prices will suffer. It’s like being a tightrope walker – one wrong step, and it’s a long fall. And trust me, I’ve seen a lot of falls in my day.
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2026-02-02 16:22