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Microsoft's (MSFT) recent decision to slow down its data center investments has sparked conversations about the broader tech industry's future, especially in relation to artificial intelligence (AI). The company has been a key player in data center expansion, notably accelerating its capital expenditures (CapEx) after the breakthrough of ChatGPT in late 2022.
Gil Luria, D.A. Davidson's head of technology research, joins Morning Brief hosts Brad Smith and Seana Smith to discuss the implications of this slowdown.
"What they're telling us now ... is that maybe they've gotten to a level that they can just sustain and plateau at ... it makes sense that they're reevaluating the portfolio of investments and starting to moderate it."
Luria notes that Microsoft's shift in spending "will then cause other mega caps, especially the hyperscalers, to reconsider their plans."
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This post was written by Josh Lynch