Catenaa, Saturday, October 31, 2026- A group of five tech heavyweights is expected to spend $828 billion as capex to meet the booming AI demand, Fortune reported.
According to Fortune, the latest financial statements by Amazon, Alphabet, Microsoft, Meta, and SpaceX revealed that they are set to invest as much as $828 billion in capital expenditures this year.
The planned investments are primarily intended to expand computing infrastructure, including semiconductor capacity and facilities supporting artificial intelligence services.
According to company earnings releases and calls, Fortune reported that $220 billion from Amazon, up to $205 billion from Alphabet, approximately $170 billion from Microsoft, up to $145 billion from Meta, and up to $88 billion from SpaceX make up the $828 billion in capex spending for 2026.
According to Fortune, several banks, including Evercore and Bank of America, see AI-related capital expenditure hitting $1 trillion in 2027.
US technology stocks declined sharply on Friday as investors reassessed the financial implications of expanding AI infrastructure budgets. The Nasdaq fell 2.9%, while the S&P 500 lost 1.8%, amid additional pressure from Intel’s weaker-than-expected quarterly outlook. Nasdaq 100 companies lost more than $1 trillion in market value.
Sour guidance from US chipmaker Intel for the last three months of the year also played a role, according to Fortune.
Fortune reported that Microsoft’s latest financial statmenty showed the company earned nearly $134 billion in profit in its latest fiscal year and generated almost $183 billion in cash from operations. In contrast, cash spending on property and equipment rose about 80%.
Microsoft announced a $25 billion bond offering Thursday, its first bond sale in more than nine years. The company said it would use the money for general corporate purposes, which it said could include capital expenditures.
According to Fortune, Microsoft was the only company among the five tech heavyweights to maintain positive free cash flow in the third quarter, meaning it spent more on buildings, equipment, and other capital investments than it generated in cash from its operations.
“As companies that built their fortunes selling software and services increasingly pour money into physical infrastructure, they are looking to borrow or raise more in some cases to pay for it,” Fortune said.
With a handful of technology stocks accounting for an outsized share of the S&P 500, Fortune reported that these companies’ investment success or failure could have enormous implications for the market and the millions of Americans invested in it.
Citing Boston College economist Aleksandar Tomic, Fortune reported that these infrastructure investments could have consequences far beyond Silicon Valley if they don’t pan out, especially as companies increasingly rely on debt to finance their expansion.
He said that this increased borrowing could raise the cost of capital for other businesses, while a downturn among the tech giants could ripple throughout the broader economy.
“If these tech companies sneeze, the rest of the market would catch pneumonia,” Tomic told Fortune.
