Azure Softness + AI Capex = The Public Cloud's New Problem

Azure Softness + AI Capex = The Public Cloud's New Problem

Why did Microsoft stock drop even after a headline beat? In this episode, cloud analyst David Linthicum breaks down the market's "beat-and-drop" reaction to Microsoft's latest earnings and what it signals about Azure, AI, and hyperscaler spending. He explains how expectations for a clear cloud re-acceleration collided with guidance that sounded more like "we're investing ahead of demand," raising concerns about capital intensity and near-term margins. Linthicum walks through the optics around Azure growth, capacity build-outs for AI training and inference, and why investors are increasingly sensitive to capex without fast operating leverage.

The conversation also explores a structural shift in enterprise cloud choices—hybrid, private and sovereign cloud, colocation, and managed service providers—and how workload economics (egress, governance, and consumption creep) can make public cloud less attractive for steady-state compute. Finally, he balances the bear case with the bull case: Microsoft's distribution advantage across Microsoft 365, security, and developer tools, and the possibility that today's spend is strategic moat-building. If you want a clearer framework for reading cloud earnings, this video delivers. You'll learn what metrics to watch next quarter, how to interpret "capacity constraints" versus demand, and where AI monetization may show up first in pricing, usage, and margins.

Episoder(128)

Will the Cloud Move to Space? Here's What Happens Next

Will the Cloud Move to Space? Here's What Happens Next

We're on the edge of a real shift: the "cloud" may stop being purely a terrestrial phenomenon and become a layered network that includes orbit. The strongest case isn't that your favorite web app move...

16 Mar 12min

5 Unpopular Cloud Opinions (That Are Actually True)

5 Unpopular Cloud Opinions (That Are Actually True)

David Linthicum challenges the feel-good narratives that dominate cloud conversations and lays out five opinions that many teams avoid saying out loud. He argues that cloud repatriation is not a failu...

9 Mar 12min

The Slow Death of OpenAI: Nobody Wants to Admit This

The Slow Death of OpenAI: Nobody Wants to Admit This

OpenAI helped kick off the AI revolution, but behind the hype the numbers tell a much darker story. In this video, we break down how a company that once looked untouchable is now burning staggering am...

3 Mar 10min

The 5 Fundamental Cloud Mistakes AWS, Microsoft, and Google are Making Today

The 5 Fundamental Cloud Mistakes AWS, Microsoft, and Google are Making Today

Cloud didn't fail—cloud providers did. AWS, Microsoft, and Google sold "simplicity," then normalized pricing that needs a spreadsheet degree, architectures that punish small mistakes, and service cata...

2 Mar 8min

Hyperscalers Are Panicking: Neoclouds Are Taking Their AI Business

Hyperscalers Are Panicking: Neoclouds Are Taking Their AI Business

Neoclouds are a new wave of GPU-first cloud providers built specifically for AI training and inference, offering a focused alternative to hyperscalers like AWS, Azure, and Google Cloud. Instead of opt...

26 Feb 12min

AI Everywhere, Adoption Nowhere: Microsoft's Copilot Epic Fail

AI Everywhere, Adoption Nowhere: Microsoft's Copilot Epic Fail

Microsoft Copilot arrived as an AI layer across Windows, Microsoft 365, and cloud consoles, but many users experienced it less as a breakthrough and more as another interface demanding attention. In W...

24 Feb 14min

Crypto Cloud Mining Scams EXPOSED!

Crypto Cloud Mining Scams EXPOSED!

A surge in fraudulent cloud mining schemes is pulling in unsuspecting investors with promises of guaranteed, sky-high returns—claims that regulators stress are not just too good to be true, but techni...

23 Feb 11min

The Executives Who Botched Cloud Should've Been Fired—So Why Are They Leading AI?

The Executives Who Botched Cloud Should've Been Fired—So Why Are They Leading AI?

In this video, David Linthicum delivers a blunt critique of how large enterprises mishandled cloud adoption and are now repeating the same mistakes with AI. He explains that many IT leaders treated cl...

16 Feb 16min

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