Google, Microsoft, Meta, and Amazon capex spending to hit $725 billion in 2026, up 77% from last year — analyst says bear thesis is 'garbage'

Source: Tom’s Hardware

Image credit: Getty / Bloomberg

Overview

Google, Amazon, Microsoft, and Meta collectively plan to spend $725 billion on capital expenditures (capex) in 2026, a 77 % increase from last year’s record $410 billion, according to first‑quarter earnings compiled by the Financial Times.

Company Highlights

Google

• Delivered the strongest results among the four firms.
• Cloud revenue jumped 63 % year over year to $20 billion.

Microsoft

• Set its calendar‑year 2026 capex at $190 billion, well above the $152 billion average analyst estimate.
• CFO Amy Hood attributed $25 billion of the increase to rising memory‑chip and component costs.
• Despite higher spending, Microsoft expects to remain capacity‑constrained through at least 2026 as it accelerates the rollout of GPU, CPU, and storage infrastructure.

Meta

• Facing growing investor unease over escalating infrastructure costs.
• Concerns that Meta’s historically lean, capital‑light model may be turning into a “capital‑intensive incinerator,” according to Dec Mullarkey, managing director of SLC Management.

Amazon

• Included in the collective $725 billion capex forecast; specific breakdown not detailed in the source.

Analyst Commentary

“The AI economy is healthy,” said Brent Thill, an analyst at Jefferies, adding that recent revenue growth justifies the enormous capital outlays.
“The bear thesis is garbage.”

Additional Visual