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Big Techs ramp up billions in bottomless spending on AI

Jul 31, 2025, 2:11pm EDT
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Meta’s CEO Mark Zuckerberg attends a live recording podcast, in San Francisco.
Laure Andrillon/File Photo/Reuters

Big Tech continues to plow billions into AI. Will the revenues follow?

“We do take very seriously that this is just a massive amount of capital,” Mark Zuckerberg told analysts Wednesday after Meta doubled its quarterly capital spending from a year ago, to $16.5 billion, and hinted it could hit $100 billion in 2026. Investors took that spending in stride — shares rose 12% today — because Meta’s core businesses continued to pump out profits.

A chart showing the quarterly capital spending of select tech companies.

Google’s cash cow of search has proven resilient, too, giving the company cover to bump up its own capital spending plans to $85 billion for the year. Ditto with Microsoft, whose market value hit $4 trillion on the back of strong earnings. (Executives for the first time disclosed revenue for its cloud business, Azure, suggesting they recognize the company must prove it can afford the huge investments it’s making.) Together, Meta, Microsoft, and Alphabet have spent $186 billion on capital expenditures over the past year — more than the revenue of 96% of S&P 500 companies.

A big question is whether Meta, whose users are everyday consumers seeking entertainment, will find it harder to convert huge AI spending into sustainable profits than will business-focused players like Microsoft. Zuckerberg’s bet is that AI will generate cheaper, better, and more-targeted ads.

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