Meta reported quarterly revenue of $60.8 billion, up 28%, but its net income fell 14% to $15.85 billion and free cash flow collapsed to $784 million from $8.55 billion a year ago. The company spent $31.1 billion in investments during the quarter and forecasts 2026 capex between $130 and $145 billion, triggering a 10% drop in its share price. Microsoft posted $90 billion in quarterly revenue, up 18%, with net income of $35.8 billion, a 31% increase, and Azure growing 43%. The company holds $678 billion in contracted orders not yet recognized, allowing it to absorb approximately $175 billion in investments without alarming the market, pushing its stock up 8%. This divergence shows that investors now demand tangible proof of return on investment, not just AI-related promises.
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