Microsoft’s AI spending became cloud revenue. Meta’s became a cash-flow hole.

Two of the biggest AI spenders reported on the same day. Microsoft’s spending showed up as cloud revenue. Meta’s showed up as a hole in its cash flow.

Meta’s revenue rose 28% to $60.8bn, beating forecasts, CNBC reported. But profit fell 14% to $15.8bn, earnings per share missed, and the shares dropped about 5% after hours.

The cash is draining out

The starkest number is free cash flow. It fell to $784m, from $8.55bn a year earlier, a 91% drop, Reuters reported. Meta is now spending faster than the money is coming in.

The reason is the AI build-out. Meta spent about $31bn on capital projects in the quarter alone, and narrowed its full-year guidance upward, to between $130bn and $145bn, it said. Last year it spent $72bn. The bill is roughly doubling.

No cloud to show for it

Here is the difference from its rivals. Microsoft...

Copyright of this story solely belongs to thenextweb.com. To see the full text click HERE