Microsoft shares fall on $25 billion bond plan despite Azure growth

Microsoft shares fell Thursday despite beating earnings expectations, as investors weighed a planned $25 billion bond issuance and lower-than-expected capital expenditures. The stock reversed early premarket gains during the session. Revenue rose 19% year-over-year to $92.28 billion, with adjusted earnings per share of $4.89 beating the $4.71 forecast. Azure cloud growth hit 48%, exceeding the 44.3% estimate, though capital expenditures of $45.2 billion missed the expected $51 billion due to third-party capacity delivery delays. Microsoft attributed the capex shortfall to timing, guiding spending above $50 billion next quarter with acceleration in the second half of fiscal 2027. Free cash flow fell to $18.6 billion from $25.7 billion but beat expectations, while the company also offered voluntary buyouts to 60,000 employees.