Quick Take Big Tech’s 2026 capital spending plans have blown past expectations , sparking a sharp market reaction. Investors still believe in AI — but they now want clear proof of returns , not just long-term promises. The CapEx Shock Across recent earnings, mega-cap tech companies pushed 2026 CapEx from “already massive” to “historically extreme” : Meta Platforms : US$115–135B vs US$110B consensus Stock jumped ~10% initially, but gains faded → investors want evidence, not AI rhetoric Microsoft : US$140–150B vs US$109B consensus Stock fell ~10% → ROI timing now under scrutiny Alphabet : US$175–185B vs US$115B consensus Shares slipped as markets adjusted to a more capital-intensive Google Amazon : ~US$200B vs US$146B consensus Stock dropped ~11% after-hours on cash flow concerns What Investors Are Really Worried About This is no longer about believing in AI — it’s about financial optics and timing . Key Market Fears CapEx is rising fa...
Quick Summary
Boycott pressure remains a key overhang on Berjaya Food Bhd, despite recent operational improvements
Losses are expected to persist for several years, according to CIMB Securities
Same-store sales improved, but competition and rising costs could weaken 2HFY2026
“Reduce” rating maintained with a target price of 20 sen
What CIMB Is Saying
CIMB Securities warned that ongoing local and nationwide boycotts continue to cloud Berjaya Food’s outlook, even as the group posted narrower quarterly losses.
While 1HFY2026 results met expectations, the research house expects a weaker 2HFY2026, citing:
Intensifying competition in the F&B space
Higher operating expenses, particularly from marketing and promotions needed to defend market share
Key risk: Any aggressive promotional push could further strain margins.
Financial Snapshot (2QFY2026)
Net loss: RM11.9m (vs RM14.6m in 1QFY2026)
Revenue: RM126.3m (+2.6% YoY)
Improvement driven by:
Festive year-end demand
Cost rationalisation, including closure of underperforming outlets
Overseas operations helped offset weaker domestic sales
Valuation Still Looks Stretched
CIMB noted that BJFood’s current valuation of ~3x FY2027 price-to-book:
Does not fully reflect expected losses through FY2026 to FY2028
Leaves limited margin of safety for investors
Shares closed at 21.5 sen, implying a 9.1% downside to CIMB’s target price.
Bottom Line
Operational tweaks are helping — but they’re not enough to offset structural headwinds.
Persistent boycotts, rising competition, and cost pressures mean profit recovery remains distant, keeping CIMB cautious on the stock.
Key Takeaways
Boycott impact remains unresolved
Losses likely to continue over the medium term
Marketing spend may rise, pressuring margins
CIMB reiterates “Reduce” with 20 sen target
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