Global tech companies are significantly increasing their capital expenditures amid the competition for dominance in artificial intelligence. According to forecasts, Microsoft, Amazon, Alphabet, and Meta will collectively spend over $344 billion by 2025 to enhance data centers for AI model operations, reports Japan Times.
Microsoft, which spent a record $24.2 billion last quarter, plans to boost its capital expenditures to $30 billion, linking this to the growth of cloud services and AI infrastructure. The company has already recorded a 39% increase in Azure sales, surpassing analysts' expectations. CEO Satya Nadella emphasized that Microsoft "leads the wave of AI infrastructure." Notably, the company recently joined the "$4 trillion club," surpassing Apple and NVIDIA.
Amazon spent $31.4 billion in the last quarter—nearly double what it spent a year ago. However, investors were left disappointed as the cloud division showed weak growth, causing the company’s stock to drop by 8.1%. Analysts predict that Amazon Web Services' margins will remain under pressure at least until 2026.
Alphabet, the owner of Google, raised its capital expenditure forecast by $10 billion to $85 billion and plans even larger investments in 2026. CEO Sundar Pichai highlighted that these investments are essential to meet the growing demand for cloud services.
Meta Platforms has also raised the lower end of its expenditure forecast for 2025 and plans to accelerate its investment pace. The company is building large data centers and attracting top AI researchers. Recently, it established a Superintelligence division to develop human-level AI. Strong advertising sales and an optimistic revenue outlook have allowed Meta’s stock to rise over 8%, indicating that AI investments are starting to pay off.
In contrast, Apple appears modest, with its capital expenditures for the nine months ending June 28 amounting to $9.47 billion, a 45% increase from a year ago, a significant portion of which is also directed towards AI. CFO Kavon Parekh expects "substantial but not exponential growth" in expenditures in the future.
Analysts note that the current strategy for Big Tech is a race for the AI market. As noted by Forrester experts, Google and other companies are simply compelled to spend enormous sums to keep pace with OpenAI and competitors.