{"text":[[{"start":7.898,"text":"Microsoft invested less than expected in new data centres during the last quarter as the cloud computing giant experienced delays in construction of the new facilities it needs to serve booming demand for AI infrastructure."}],[{"start":19.76,"text":"The company on Wednesday said its capital expenditures in the three months to September 30 came to $45.2bn, considerably less than the $51.7bn Wall Street expected."}],[{"start":32.24,"text":"Amy Hood, Microsoft’s chief financial officer, told investors that the shortfall was “due to some third-party capacity deliveries” being delayed. The company added it expected these data centres to come online in the second half of its current fiscal year."}],[{"start":47.32,"text":"The disclosure shows Microsoft is coming up against the real-world constraints of delivering its plans to spend $170bn this calendar year on data centres to meet demand from customers including AI labs such as OpenAI and Anthropic."}],[{"start":62.16,"text":"The push to rapidly build more huge facilities to train and run AI models has faced difficulties securing land, electricity and planning permissions — as well as a growing political backlash."}],[{"start":73.96,"text":"Rival Alphabet, which has also joined Big Tech’s AI investment spree, also reported lower-than-expected capex on Wednesday."}],[{"start":82.005,"text":"Hood added that Microsoft’s capex would accelerate in the second half of its fiscal year primarily due to the rising costs of memory hardware."}],[{"start":90,"text":"Microsoft said revenue in the three months to September rose 19 per cent to $92.3bn, beating Wall Street’s expectations of $90.6bn. The stock rose about 3 per cent in after-hours trading."}],[{"start":103.402,"text":"Sales in its Azure division were $33.2bn, up 48 per cent from $22.4bn a year ago, as the company reorganised its reporting to disclose sales in the cloud business for the first time. Analysts expected $32.3bn."}],[{"start":118.64,"text":"Net income rose 32 per cent from the previous year to $36.6bn. Free cash flow declined from the previous quarter to $18.6bn, higher than analysts anticipated."}],[{"start":131.36,"text":"Microsoft reported 11 per cent of its revenue in the quarter came from its partnership with OpenAI, in which it has a 27 per cent stake. The AI lab buys computing power from Microsoft and lets the software group resell its models to clients, while the cloud giant also receives a portion of OpenAI’s revenue."}],[{"start":149.823,"text":"Chief executive Satya Nadella told investors the company was focused on developing its own AI models and applications in a bid to diversify its revenues."}],[{"start":159.6,"text":"Microsoft generated $27.8bn in sales from its workplace software, including its AI-powered assistant Copilot, in the quarter, beating expectations of $27.5bn."}],[{"start":172.24,"text":"The company added 24 new data centres in the quarter. It has turned to several so-called neoclouds, including CoreWeave, Nebius and Nscale to support its build-out. It has signed contracts worth more than $80bn in total with the challenger operators since 2023, according to regulatory filings and public statements."}],[{"start":194.88,"text":"However, some of these smaller players have had difficulty delivering projects on time. Last week, it emerged that Microsoft had pulled out of a deal to lease computing capacity from the UK start-up Nscale due to power constraints at the site."}],[{"start":209.92,"text":"The decision followed a move in January last year to withdraw from contracts involving CoreWeave. Meanwhile, construction by Nebius at a 300MW facility in Vineland, New Jersey, is progressing more slowly than anticipated, the FT previously reported."}],[{"start":224.978,"text":"As it increases AI investments, Microsoft has also moved to control costs and cut jobs. On Monday, it said it would offer buyout packages to up to 60,000 staff."}],[{"start":235.351,"text":"The decision, which will affect employees in the US, Canada, UK and India, comes after it made a “voluntary retirement programme” available to older, longer-serving staff in April."}],[{"start":247.28,"text":"Microsoft on Wednesday said headcount fell 2 per cent year on year."}],[{"start":252.96,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1793238199_7414.mp3"}