NewsMacro & flows
Alphabet sinks 8% after hours on EPS miss; Microsoft gains 4% on Azure beat
8% after-hours drop for Alphabet on a $0.90 EPS miss as AI capex erases cash flow; Microsoft rises 4% on 48% Azure growth.
Alphabet EPS $2.12 vs $3.02 expected; shares -8% after hours, beyond the ~6% options priced. Microsoft beat ($4.89 EPS, $92.3B revenue) on Azure +48%; shares +4%.
Market read: AI spending is rewarded only when cash flow holds; Alphabet posted negative free cash flow of $9.1B.
Watch: Nasdaq 100 open and Amazon's report Thursday.
Why it matters
Alphabet's drop exceeded the ~6% move options priced, showing investors now punish AI capex that burns free cash flow while rewarding growth with discipline. Expect pressure on Nasdaq 100 and big-tech ETFs at Thursday's open.
Source: Investing.com
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