Big Tech Announces Combined $650B AI CapEx for 2026
Narrative
Amazon $200B, Alphabet $175-185B, Microsoft ~$145B, Meta $115-135B. Combined ~$650B for 2026, a 60-74% jump from $381B in 2025. Vast majority earmarked for AI chips, servers, and data center infrastructure. Bloomberg: "a boom without a parallel this century."
Reality
Announced across earnings calls Jan-Feb 2026. Amazon shares fell sharply after $200B reveal. Alphabet capex exceeded not just analyst estimates but spending of vast swath of American industry. Combined $650B exceeds the 21 largest US automakers, defense contractors, railroads, and carriers combined ($180B). Triggered investor anxiety over ROI sustainability. AI-related debt issuance projected in hundreds of billions for 2026.
Implication
Unprecedented corporate spending commitment. Comparable only to 1990s telecom bubble and 19th century railroad buildouts. Each company spending more in one year than their past three years combined. Raises fundamental questions about sustainable returns. Hardware suppliers (Nvidia, Cerebras) and power utilities are primary beneficiaries.