Microsoft and Intel are moving in opposite directions as investors react to the latest earnings and strategic updates, highlighting the uneven impact of artificial intelligence across the technology sector.
Microsoft shares edged 0.38% lower to $412.63 on Monday, extending weakness after a sharp sell-off triggered by its earnings report last week. The stock briefly fell below $400 amid concerns over the company’s $190 billion annual capital expenditures guidance. While Azure cloud revenue grew 40% in the most recent quarter, matching expectations, the lack of meaningful acceleration has left some analysts cautious. Ned Davis Research analyst Pat Tschosik noted that the market will only tolerate high spending if accompanied by accelerating cloud sales growth.
In contrast, Intel surged over 13% in pre-market trading on Tuesday following a Bloomberg report that Apple held early discussions with Intel about possible chip manufacturing. Apple also reportedly spoke with Samsung, signaling potential diversification from its heavy reliance on Taiwan Semiconductor Manufacturing Company. No final decision has been made, and representatives from both Intel and Apple declined to comment, but the talks underscore growing confidence in Intel’s foundry turnaround.
Beyond the Apple chatter, Intel’s first-quarter revenue of $13.6 billion—up 7% year-over-year—and upbeat second-quarter guidance have lifted sentiment. Several analysts raised their price targets, with Evercore ISI moving to $111 and Tigress Financial setting a range up to $118. Demand for AI infrastructure remains a central pillar for Intel’s Data Center and AI unit, even as the stock faced net selling in April among high-beta names.
Both stories illustrate how AI tailwinds and heavy capital investment are reshaping investor narratives. While Microsoft faces scrutiny over whether its cloud business can accelerate enough to justify massive spending, Intel is gaining traction as a potential alternative in chip manufacturing for major customers like Apple.
