Episode summary
Instant Reaction Earnings Roundup: Microsoft, Meta & Tesla Deliver Results | Bloomberg Daybreak:...
Bloomberg Daybreak: US Edition
· · Hosts: Carol Massar, Tim Stenovec · Guests: Anurag Rana, James Cakmak, Kurt Wagner, Ed Ludlow, Steve Man
Summary
Microsoft’s results drew the sharpest skepticism because Azure growth came in around expectations rather than beating them, even as revenue, RPO and capex all surged. An analyst said the issue was not the spending itself but the market’s very high bar, and argued that the biggest long-term risk is Microsoft’s dependence on OpenAI and whether it can eventually replace that engine on its own. A guest investor said the quarter was basically in line and did not justify changing a cautious stance on the stock.
Meta got a much warmer reaction. A technology reporter said the quarter was broadly positive, with revenue beating estimates and first-quarter guidance topping expectations, while investors appeared more willing to accept a much larger 2026 capex plan because ad growth and pricing are still strong. The discussion framed Meta’s AI spending as something that is increasingly visible in the ad business rather than just a speculative future payoff.
Tesla’s story was less about the quarter than about strategy. The company disclosed a $2 billion investment in xAI, plus a closer framework for product and technology collaboration. Guests focused on Tesla’s push into robo taxis, physical AI and deeper vertical integration, while also noting that the company’s first annual revenue decline and the uncertainty around execution still leave investors split.
Key takeaways
- Microsoft’s Azure growth at roughly 38% was viewed as good but not good enough versus elevated expectations.
- An analyst said Microsoft’s biggest long-term risk is losing the OpenAI engine behind Copilot and related products.
- Meta’s stronger revenue, guide and ad metrics made investors more willing to accept 2026 capex of $115 billion to $135 billion.
- A guest said Tesla’s $2 billion xAI investment matters strategically, but not enough by itself to change a cautious portfolio view.
- IBM was highlighted as a positive surprise, with software growth and higher cash flow helping validate its acquisition-led strategy.
Notable quotes
“the fact that they only met Azure uh growth rates which was 38%. I think that's probably weighing on the stock”
“we are absolutely in flux right now as to who will own the final product”
“I would, you know, comfortably say when it comes to somebody like a Microsoft's cloud portfolio or Amazon's cloud portfolio or Google's cloud revenue”
“The real maybe surprising thing was just how high the capital expenditures are are supposed to be in 2026”
“Tesla's done it. Not only are they investing$2 billion dollars into XAI”
How the episode opens
Ditch the complexity. Intu it enterprise suite delivers AI native ERP power that is intuitive and intelligent. Scale faster with advanced control. Getting started in days, not months. Learn more at inwit.com/enterprise and get the power you need. — Bloomberg Audio Studios podcasts radio news. This is a breaking news update from Bloomberg. Instant reaction and analysis from our 3,000 journalists and analysts around the world.
Carol Masser along with Tim Stanovvic live in our Bloomberg Interactive Broker studio. As we mentioned uh those big three of the MAG 7 reporting uh right now Meta is up about four and a quarter%. Microsoft down about 5% off its uh aftermarket lows. Tesla has also bounced back.
I want to bring in Bloomberg intelligence senior technology analyst Anuag Rana. He joins us in Bloomberg's Chicago bureau. Uh Microsoft down 5% right now.
Taking a look at uh some of the headlines on URG that crossed. I know you've only had a few minutes to actually look at these. Second quarter, Azure, another cloud revenue.
XFX was up 38% meeting estimates. Second quarter revenue for the company beat estimates at 81.27 billion. Uh second quarter intelligent cloud revenue beat estimates.
Uh we also saw 40 3 Microsoft 365 commercial seats grew 6%. 45% of commercial RPO was driven by open AAI commitments commercial remaining performance obligation $625 billion. What's not to love here?
Is it all about capex?
No. I think it's usually high expectations and you know the fact that they only met Azure uh growth rates which was 38%. I think that's probably weighing on the stock because you know one would have expected them to blow out that number. It has been around 39% the last couple of quarters. So I think that's where a little disappointment could be but that could also be because of supply constraints.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- microsoft earnings
- meta earnings forecast
- tesla xai investment
- ai spending payoffs
- cloud growth slowdown
Companies and tickers mentioned
- TSLA
- MSFT
- META
- Tesla
- Microsoft
- Meta Platforms
- xAI
- Clockwise Capital
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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