Microsoft reported lower-than-expected revenue growth for its AI and cloud divisions as scrutiny grows over tech's AI investments.

Microsoft’s cloud and AI businesses are doing pretty well — and their impact is being felt across the company. In its Q2 2025 earnings, Microsoft announced revenue of $69.6 billion for the quarter, up 12 percent year-over-year, and net income of $24.1 billion, which is up 10 percent year-over-year.

Microsoft on Wednesday posted disappointing Azure cloud business growth and large artificial intelligence expenses, hitting its shares as a recent surge in low-cost Chinese AI technology threatens to undermine the case for such big spending.