Volkswagen And Microsoft CEOs Hold "Fireside Chat"

(Sean Gallup/Getty Images)

Nadella: “I feel very, very good” about the pace of Microsoft’s data center plans

Microsoft plans an increase in capital expenditures for AI, but say it’s being careful not to get “upside down” on demand.

Jon Keegan

5/1/25 10:08AM

Yesterday Microsoft delivered a blowout earnings report, beating expectations fueled by strong demand for AI on its Azure cloud computing services. Investors were quite happy, with the stock up over 9% in early trading today.

On the earnings call, everyone was eager to hear more about Microsoft’s capex plans.

Year on year, capital expenditures were up 52% to $16.2 billion for the quarter. But what about the recent reports of Microsoft pulling back on data center construction?

On an earnings call with analysts yesterday, CEO Satya Nadella led with an update on infrastructure:

“We continue to expand our data center capacity. This quarter alone, we opened DCs in 10 countries across four continents. Model capabilities are doubling in performance every six months, thanks to multiple compounding scaling laws.”

Basically, it’s a complicated moment that AI infrastructure builders face now.

All of the buildings, servers, networking, and energy hardware that are allocated for data centers today will be running models that will have already jumped ahead in capabilities and efficiencies — the field is moving really fast, and building huge data centers is comparatively really slow.

In response to an analyst’s question about the reports of a pullback, Nadella said:

“The reality is we’ve always been making adjustments to build, lease, what pace we build all through the last whatever 10, 15 years. It’s just that you all pay a lot more attention to what we do quarter over quarter nowadays.”

Nadella emphasized that they did not want to find themselves in a situation where they overshot demand.

“You don’t want to be upside down on having one big data center in one region when you have a global demand footprint. You don’t want to be upside down when the shape of demand changes.”

Overall, Nadella expressed confidence in the company’s capex plans, which are expected to increase next quarter. Nadella said, “I feel very, very good about the pace.”

And so far today, investors do too.

Paramount Announces It's Cutting 2,000 Jobs

Paramount improved its Warner Bros. offer to $31 per share

WBD confirmed receipt of the new offer on Tuesday and said it would review the proposal.

Max Knoblauch4h

Archer Aviation sues rival Vertical, alleging air taxi design patent infringement

Archer Aviation alleged that Vertical’s Valo aircraft “mimics” its own Midnight aircraft.

Anglo American halves De Beers’ value as the natural diamond slump deepens

The miner has now written down De Beers by roughly $6.8 billion over the past three years.

Max Knoblauch2/23/26

Paramount is expected to raise its Warner Bros. offer to $32 per share

Paramount’s seven-day window to talk to Warner Bros. Discovery about its best and final offer is set to end at 11:59 p.m. ET on Monday, and the company is expected to finally raise the per-share dollar amount of its bid.

According to reporting by Variety, Paramount’s revised offer is likely to arrive at $32 per share for the HBO and CNN parent.

Paramount’s last major revision to its offer came earlier this month, when it said it would cover the $2.8 billion breakup fee that WBD would owe Netflix in the event of that deal falling apart, and would pay shareholders a “ticking fee” of $0.25 per share for every quarter the deal hasn’t closed after the end of 2026.

Netflix’s next move will be determined by the response of Warner Bros.’ board. Per reporting by Reuters, the streamer has ample cash to increase its own offer for its streaming rival. Analysts at MoffettNathanson Research last week said they expect Netflix to walk away from Warner Bros. if Paramount’s bid comes in “well beyond” $32.

As of Monday at 9 a.m. ET, prediction markets speculating on which company will ultimately come out on top of the bidding war have Netflix at a 46% chance over Paramount’s 43% odds.

Also potentially affecting prediction markets is a Truth Social post by President Trump on Sunday, in which Trump wrote that Netflix must fire board member Susan Rice immediately or "pay the consequences."

(Event contracts are offered through Robinhood Derivatives, LLC — probabilities referenced or sourced from KalshiEx LLC or ForecastEx LLC.)

Paramount Is Expected to Raise Price of Warner Bros. Discovery Bid. Will Netflix Walk Away?

As of Monday at 9 a.m. ET, prediction markets speculating on which company will ultimately come out on top of the bidding war have Netflix at a 46% chance over Paramount’s 43% odds.

(Event contracts are offered through Robinhood Derivatives, LLC — probabilities referenced or sourced from KalshiEx LLC or ForecastEx LLC.)

Max Knoblauch2/20/26

Microsoft makes dramatic shake-up to its gaming division as gaming CEO Phil Spencer and Xbox President Sarah Bond depart

Microsoft’s gaming division underwent a major shake-up on Friday, as the tech giant announced the departure of gaming CEO Phil Spencer, who led the division for 12 years and championed its Game Pass subscription service.

Xbox President Sarah Bond is also out, according to Spencer’s memo to employees.

Xbox has fallen significantly behind rivals Sony and Nintendo in recent years. Microsoft raised Xbox console prices twice last year and bumped subscription fees up 50%. In November, the console was even outsold (in unit sales) by the motion-controlled Nex Playground console.

The pair have overseen a shift at Xbox from standard consoles to an array of consoles, handhelds, and various devices and screens accessed via cloud gaming.

Spencer’s replacement as the head of gaming is Microsoft’s president of CoreAI product, Asha Sharma. In a memo to staff, Sharma made three commitments: great games, the “return of Xbox,” and to “invent new business models and new ways to play.”

Xbox chief Phil Spencer is leaving Microsoft