{"id":22656,"date":"2026-04-30T06:50:21","date_gmt":"2026-04-30T06:50:21","guid":{"rendered":"https:\/\/www.europesays.com\/ai\/22656\/"},"modified":"2026-04-30T06:50:21","modified_gmt":"2026-04-30T06:50:21","slug":"microsoft-meta-and-google-just-silenced-ai-spending-critics-in-one-earnings-night-as-big-tech-capex-swells-to-725b","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ai\/22656\/","title":{"rendered":"Microsoft, Meta And Google Just Silenced AI Spending Critics In One Earnings Night As Big Tech Capex Swells To $725B"},"content":{"rendered":"

Higher component costs, including memory chips, along with plans to build more data centers than previously anticipated, drove the upward revision in capex.\n<\/p>\n

Strong cloud results allayed fears around higher AI spending.Google has hiked its 2026 capex projection by $5 billion, while Meta raised it by $10 billion.Google Cloud sales rose by a record 63%, sending the company\u2019s shares over 6% higher in post-market hours.<\/p>\n

Alphabet, Inc. and Meta Platforms, Inc. on Wednesday raised their capital spending outlooks, with four of the biggest tech companies now projecting combined 2026 spending of up to $725 billion \u2013 bigger than the GDP of countries like Switzerland or Turkey.<\/p>\n

Alphabet, Meta, Amazon, and Microsoft are racing to build out new data centers to meet surging demand for AI compute, insisting the technology is a once-in-a-generation opportunity \u2013 and that the unprecedented spending is both justified and poised to pay off.\u00a0\u00a0<\/p>\n

Moreover, strong cloud results across the board have, for now, eased concerns around overspending. The three leading hyperscalers \u2013 Amazon Web Services, Microsoft Azure, and Google Cloud \u2013 have posted higher sequential growth rates, with Google Cloud revenue surging 63.4% year over year, a record pace.<\/p>\n

\u00a0<\/p>\n

\u00a0Initial 2026 Capex PlanRevised 2026 Capex PlanAmazon$200 billionUnchangedMeta$115 billion to $135 billion125 billion to $145 billionAlphabet\u00a0$175 to $185 billion$180 billion to $190 billionMicrosoft$88.2 billion plus*$190 billion**\u00a0<\/p>\n

*Microsoft said last year its capex for the fiscal year 2026, which ends in June, will be higher than the $88.2 billion it spent in FY25.\u00a0
**Forecast is for calendar year 2026.<\/p>\n

\u201cWe are seeing unprecedented internal and external demand for AI compute resources. The investments we are making in AI is delivering strong growth as evidenced by the record revenue and backlog growth in Google Cloud and strong performance in Google Services. Looking ahead, these strong results reinforce our conviction to invest the capital required to continue to capture the AI opportunity,\u201d Alphabet CFO Anat Ashkenazi said on the company\u2019s analyst call.<\/p>\n

She said the company\u2019s capex next year will \u201csignificantly increase compared to 2026.\u201d<\/p>\n

Meta and Microsoft said spending would be higher this year, in part because of surging component prices, likely for memory chips.<\/p>\n

\u201cFor calendar year 2026, we expect to invest roughly $190 billion in capital expenditures, which includes approximately $25 billion from the impact of higher component pricing,\u201d\u00a0Microsoft CFO Amy Hood said on the earnings call.<\/p>\n

Meta CFO Susan Li said, the capex increase \u201creflects our expectations for higher component pricing this year and to a lesser extent, additional data center costs to support future year capacity.\u00a0<\/p>\n

\u201cThe \u2018AI capex is speculative\u2019 narrative is dead,\u201d The Futurum Group CEO Daniel Newman said in an\u00a0X post<\/a>. “The companies investing in AI infrastructure today are buying the most valuable real estate of the next decade and tonight they showed exactly why.”\u00a0<\/p>\n

Alphabet\u2019s results were comparatively strong, and the stock rose 6.4% in overnight trading following the report.\u00a0<\/p>\n

Pivotal Research raised its price target on GOOGL to $470 from $420 (34% upside from the stock\u2019s last close) and maintained a \u2018Buy\u2019 rating. Alphabet reported a “much stronger-than-expected” Q1, including a fifth straight quarter of accelerating search revenue growth of 19%, the research firm said in an investor note, adding that they offset concerns around the higher capex.<\/p>\n

For updates and corrections, email newsroom[at]stocktwits[dot]com.<\/p>\n

Read Next:\u00a0Why Microsoft CEO Satya Nadella Feels \u2018Very Good\u2019 About New OpenAI Deal While Amazon Adds GPT Models To AWS<\/a><\/p>\n

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