Amazon, Microsoft, and Meta all crushed earnings in late July. Microsoft's stock jumped 9% after hours on July 29. Amazon climbed over 5%. Meta stumbled nearly 10% despite strong numbers, as Wall Street fretted over how long it'll take the company to actually monetize all this spending.
The AI spending spree is real and staggering. Microsoft's AI business hit a $37 billion annual run rate, up 123% year-over-year, while Azure grew 43%. The company is now guiding capex to $175 billion for 2026. Amazon's AWS posted 28% revenue growth and hiked full-year capex guidance to $220 billion. Meta pushed its capex range to $130-145 billion.
All three are betting that bigger infrastructure means better access to frontier models and happier enterprise customers. Microsoft explicitly credited its OpenAI partnership as the main driver. Azure isn't just renting server space anymore, it's selling passage to cutting-edge AI, and companies are lining up.
Four companies, Alphabet, Microsoft, Amazon, and Meta combined, are projected to spend roughly $725 billion on AI-related capex in 2026 alone. That number balloons to somewhere between $950 billion and $1.2 trillion next year. The hyperscaler arms race shows no signs of slowing down.
This article is informational and not investment advice. Always conduct your own research before making financial decisions.
