Big Tech will spend nearly $700 billion on AI this year. No one knows where the buildout ends
Major tech companies including Alphabet, Amazon, Meta, and Microsoft are projected to spend nearly $700 billion on AI infrastructure in 2024, up from $410 billion in 2023, driven by data centers, chips, and networking. Investor reactions have been mixed, with Meta and Microsoft shares falling due to spending concerns while Alphabet and Amazon rose on strong cloud performance. The massive investment reflects soaring demand for computing power, though some analysts warn of overbuilding and financial risks from rapidly depreciating hardware.
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Welcome to Eye on AI, with AI reporter Sharon Goldman. In this edition: SoftBank plans to list a new AI and robotics company in the US…AI model’s goblin habit, explained…Putting Google’s AI to the test as a trip planner.Recommended Video If Big Tech’s AI spending spree were like climbing Mount Everest, they would still be ascending toward the summit, getting dizzy from the altitude. In quarterly earnings, estimates from Alphabet, Amazon, Meta and Microsoft put combined capital expenditures at more than $130 billion for the quarter, driven by buildouts of data centers and other infrastructure. That spending could surpass $700 billion this year, up sharply from about $410 billion last year.
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