"Amazon's capital expenditures surged 77% year-over-year, with Q1 spending hitting $44.203 billion. Free cash flow collapsed to $1.2 billion from $26 billion year-over-year, and long-term debt swelled to $119.1 billion from $65.6 billion."
"Despite the cash impact, Amazon's operating margins beat expectations at 13.1% versus the Street's 11.7%, and AWS grew 28% year-over-year, marking its fastest growth in 15 quarters."
"Microsoft's capital expenditures dropped to $31.9 billion, lower than analysts anticipated, fueling speculation that Microsoft is curbing spending due to Wall Street pressure."
"Azure posted 40% growth, and the AI run rate hit $37 billion, up 123%, but concerns arose over Microsoft's OpenAI relationship following the termination of their exclusive agreement."
Amazon's capital expenditures increased by 77% year-over-year, leading to a significant drop in free cash flow and a rise in long-term debt. Despite this, Amazon's operating margins exceeded expectations, and AWS experienced its fastest growth in 15 quarters. In contrast, Microsoft reported a decrease in capital expenditures, raising concerns about its AI strategy following the end of its exclusive agreement with OpenAI. Azure continued to show strong growth, but investor sentiment was affected by these developments.
Read at 24/7 Wall St.
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