Investors sour on Big Tech's $740 billion AI infrastructure spend
Original title: Cracks are emerging in the AI spending boom
Alphabet, Amazon and Meta reported negative free cash flow as chip stocks and the Nasdaq sold off Friday.
Alphabet, Amazon, Meta and Microsoft have outlined more than $740 billion in capital spending this year, largely read as AI infrastructure. Alphabet posted $9.1 billion in negative third-quarter free cash flow, and Search ad growth slowed to 12%. Amazon and Meta also reported negative free cash flow, while Microsoft stayed positive and blamed capacity delays. Debt issuance and a possible Anthropic IPO add to concern about returns.
Unconfirmed: Whether the outlays will earn adequate returns, and whether Anthropic gets an investment-grade rating, are unconfirmed.
- Alphabet expects up to $205 billion in capex this year and more in 2027.
- Amazon guides to $220 billion in capex after $42.4 billion negative free cash flow.
- Meta guides to as much as $145 billion in capex; Muse is compute-heavy.
- Microsoft, Alphabet, Amazon, Meta and Oracle raised $326 billion in debt in 2026.
- Alphabet fell 12% Thursday, wiping out about $500 billion in market value.
- Products
- AWSGoogle Search
From the original article
3 min read at techcrunch.com
Big Tech is pouring billions into AI infrastructure, but mounting debt, negative cash flow, and growing investor skepticism are raising questions about the sustainability of the AI spending boom.
By Rebecca Bellan · techcrunch.com
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