Microsoft is stuck in an infrastructure investment arms race that could lead customers to ask difficult questions about costs, said analysts.

Microsoft said its cloud-computing business will continue to grow slowly in the current quarter as the company struggles to build enough data centers to handle demand for its artificial intelligence products.

The Windows maker’s revenue rose 12% year-on-year to $69.6 billion in Q2 FY25, with net profit surging 10% to $24.1 billion.