Why Jim Cramer Says Alphabet, Microsoft Are Fat, Happy And Wrong: 'Concern Is The Course Of The Day'

Alphabet Inc (NASDAQ: GOOG) and Microsoft Corp (NASDAQ: MSFT) shares are sliding Wednesday after the pair of big tech firms turned in disappointing quarterly results.

Jim Cramer attributed the majority of the companies underperformance to overstaffing issues Wednesday on CNBC's "Squawk On The Street."

What To Know: Microsoft cut close to 1,000 employees last week as the company continues to anticipate slowing revenue, yet Microsoft said it will continue hiring in key growth areas. 

Alphabet added nearly 12,000 employees to its workforce last quarter after adding 17,500 in the first half of the year. At the end of September, Alphabet had about 187,000 employees. 

"These companies are fat, they're happy and they're wrong," Cramer said. 

Check This Out: Why This Analyst Sees A Massive 44% Upside For Google Parent Alphabet's Stock

With the cryptocurrency market trending lower, Alphabet should have anticipated a decline in crypto ads, he said, adding that management should have also anticipated declines in other ad categories like mortgages and right-sized appropriately. 

"The unrealistic nature of that company is shocking," Cramer said. 

Cramer also sees signs of trouble ahead at Microsoft after CFO Amy Hood seemed to lack concern about the operating environment on the company's conference call.

"I'm not saying she drank the Kool-Aid, I am saying that she's not at all really concerned and I think concern is the course of the day," Cramer said.

See Also: Microsoft Q1 Earnings Highlights: Revenue And EPS Beat, Cloud Revenue Up 24%, But These Areas Saw Declines

GOOG, MSFT Price Action: Alphabet was down 6.74% at $97.85 and Microsoft was down 5.82% at $236.11 midday Wednesday, according to Benzinga Pro.

Photo: Owen Byrne from Flickr.