Big Tech reports record AI infrastructure spending; combined capex surges toward $725 billion annually
Microsoft, Google, Meta, and Amazon reported massive increases in capital expenditures for AI infrastructure in Q1 2026, with combined capex hitting $130 billion and projected 2026 spending of $725 billion. Google's results impressed investors most, with Cloud revenue growing 63% year-over-year to $20 billion, while Meta's and Microsoft's stock responses were more mixed despite strong growth.
Tech Giants' AI Spending Surge
Alphabet, Meta, Microsoft, and Amazon collectively reported more than $130 billion in Q1 capital expenditures, primarily for AI data centers and related equipment, marking another quarterly record. The four companies now project up to $725 billion in full-year capex, with Microsoft issuing its first 2026 guidance of $190 billion to match Alphabet, while Meta and Alphabet raised their forecasts and Amazon held steady at $200 billion.
Mixed Investor Response
Meta's stock dropped more than 6% after hours, while Microsoft was essentially flat. Conversely, the share price of Google parent Alphabet rose almost 7% in after-hours trading. Google Cloud's Chief Financial Officer Anat Ashkenazi said the company is seeing "unprecedented internal and external demand for AI compute resources."
Google Cloud's Success
Alphabet's Google Cloud revenue grew 63% year-over-year to $20 billion, more than doubling its growth rate. The enterprise cloud computing segment backlog is $462 billion, which nearly doubled this quarter compared to last quarter, with Alphabet planning to see just north of 50% of that backlog turn into revenue over the next 24 months.