Overview
- Alphabet and Amazon lifted capex plans while pointing to tangible payoffs, including Alphabet’s AI product revenue tripling year over year and Google Cloud sales rising 34% to $15.2 billion.
- Meta’s higher operating costs and larger 2026 capex plans, without clear near-term monetization, drove a 12% two-day slide wiping out about $200 billion in market value.
- Executives said AI demand still exceeds available capacity and forecast even faster investment next year, with Microsoft indicating capex will grow more quickly in fiscal 2026 than 2025.
- JPMorgan and other analysts cautioned that Meta’s costs look outsized versus rivals that can monetize through cloud services, underscoring divergent paths to AI payback.
- Suppliers stand to benefit from the buildout as analysts see data-center capex expanding in 2026, while Microsoft sought to ease concentration worries by noting a record $392 billion backlog spread across many products and customers.