(Yahoo! Finance) - The biggest companies making the biggest artificial intelligence investments signaled Wednesday that they’re not done raising their investment ambitions to meet this moment.
On Wednesday, Microsoft (MSFT), Amazon (AMZN), Meta Platforms (META), and Alphabet (GOOG, GOOGL) each reported quarterly results. Ahead of these results, we argued that the most important number to emerge from the reports would be estimated capital expenditures from the big four hyperscalers.
Going into the quarter, the high end of estimates put the group's AI spending at around $670 billion this year. As of Wednesday night’s reports, that number is closer to $725 billion.
Meta was the first to announce its plans for 2026, raising its capex forecast to $125 billion to $145 billion, up $10 billion at both ends. In its earnings release, Meta said this increased forecast is due to “expectations for higher component pricing this year and, to a lesser extent, additional data center costs to support future year capacity.” Meta stock fell about 6% following this report.
On its earnings call, Alphabet told investors it now expects full-year capex to fall in the range of $180 billion to $190 billion, up $5 billion at both ends. Looking out to 2027, the company told investors it expects capex spending to increase “significantly.” Alphabet stock was up 7% following its report, which showed Google Cloud growth that topped forecasts.
Microsoft told investors on Wednesday night’s earnings call that it expects capex spending for calendar year 2026 to reach $190 billion, including $25 billion due to higher component pricing, similar to the forecast Meta outlined.
“We remain confident in the return on these investments, given higher demand signals and increasing product usage, as well as the efficiencies we’re already driving across the platform,” the company said. As of January, Microsoft’s annualized rate of AI capex was closer to $150 billion.
Amazon, which said in January that it expected its capital expenditures in 2026 to approach $200 billion, told investors on its earnings call that its plan remained “largely the same.”
Much of this investment is spent on acquiring high-performance chips from the likes of Nvidia (NVDA). Taking Nvidia’s quarterly results released in late February together with more recent indications from chipmakers like Taiwan Semiconductor Manufacturing Company (TSM), there were few signs that this quarter would be the moment for any of these hyperscalers to signal a pullback in investment.
Moreover, a crunch in the supply of memory and other lower-powered chips has made some tech stalwarts of yesteryear, like Sandisk (SNDK), Western Digital (WDC), and Intel (INTC), leaders in the stock market’s latest leg higher. Seagate’s (STX) 11% rally on Wednesday following its quarterly results was the latest case in point on that trade.
But within the past week, reports surfaced that at least two of these firms — Meta and Microsoft — were looking to lean out their teams. This investment doesn’t come free, and after years of these companies throwing off oodles of free cash, Big Tech is now tapping debt markets to fund this investment.
The contours of the AI trade have also appeared subject to quick change in recent months. Sentiment toward software stocks has washed out, and enthusiasm for new AI models from startups like OpenAI and Anthropic seems to rise and fall in rapid succession.
For Big Tech’s biggest companies, however, all signs continue to point to AI as an opportunity that presents one big risk right now — underspending.
By Myles Udland
April 29, 2026
