Sometimes, it feels like the race in the AI industry is all about who can invest the most in data centers. The belief is simple: those with the most powerful compute capabilities will create the best AI products and lead the market. But there are limits to this approach. In the long run, successful businesses need to make more money and spend less. Still, this mindset has captivated many large tech companies.
Right now, Amazon appears to be ahead in this race. Recently, the company announced that it plans to spend $200 billion on capital projects through 2026, a sharp rise from the $131.8 billion it spent in 2025. While it’s easy to link this massive budget to AI, Amazon’s spending will also cover robotics and other technologies.
Google isn’t far behind. It recently projected capital expenditures between $175 billion and $185 billion for 2026, up from $91.4 billion the year before. This is a significant leap compared to many competitors.
Meta has also joined the fray, estimating its spending for 2026 to be between $115 billion and $135 billion. In contrast, Oracle is planning a modest $50 billion, and Microsoft has yet to release a projection but recently spent around $37.5 billion, suggesting it could also approach $150 billion if it maintains that pace.
The underlying belief in the tech world is straightforward: AI has the potential to make high-end computing a crucial resource. Companies that control their supply will be the most resilient. However, investors are anxious. Stock prices for these companies have dipped as they wrestle with the reality of such high expenditures. Even well-established companies like Microsoft and Amazon face scrutiny alongside Meta, which is still figuring out its AI strategy.
Investor sentiment is a factor, but not the only one. Even if Wall Street shows concern, tech giants might press on with their AI ambitions, convinced of its transformative potential. As these companies move forward, they will likely feel pressure to manage perceptions about the costs involved in their AI strategies.
Understanding these trends is essential because, according to a recent survey by McKinsey, 70% of organizations are planning to invest in AI technologies over the next few years, up from just 14% in 2017. This highlights the growing importance of AI in the business landscape. As the competition heats up, how companies respond to challenges and expectations will shape the future of AI.
For further reading, you can check out the McKinsey survey and insights on capital expenditures from TechCrunch.
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