Reported AI capex shortfall tied to delayed third-party data centers

Microsoft spent about $5 billion less than expected on AI infrastructure in the September quarter, which the CFO attributed to delays at outside cloud providers without naming them. A research firm's satellite review reportedly links the gap to construction and permitting delays at projects tied to IREN in Texas and Nebius in New Jersey, and Microsoft separately dropped a planned U.K. site with Nscale over grid access. Quarterly capital spending of $45.2 billion came in below the roughly $50.7 billion analysts had expected. The reporting raises the question of whether the timing shift is temporary or whether capacity from partners will arrive later than planned.

1. Microsoft posted quarterly capital spending of $45.2 billion versus about $50.7 billion expected.
2. CFO Amy Hood attributed the roughly $5 billion shortfall to delays involving outside cloud providers, without naming them.
3. Research firm Aterio reportedly tied the gap to IREN-linked projects in Texas, including a Horizon 4 facility that lacked backup generators and cooling equipment in an October 21 satellite review.
4. A New Jersey project developed by DataOne for Nebius reportedly could see about 140 megawatts move into 2027 after permit and fuel-cell approval delays.
5. Microsoft scrapped a planned 50-megawatt U.K. data center deal with Nscale in October due to power supply uncertainty and grid access delays into the 2030s, per Benzinga.
6. The IREN and Nebius contracts were reported at $9.7 billion and $17.4 billion respectively.