Big Tech companies are significantly increasing their spending on artificial intelligence, with Amazon, Alphabet, Microsoft, and Meta expecting combined capital expenditures of $364 billion for 2025. This is a sharp increase from their prior forecast of $325 billion.
Despite the massive spending, investors remain positive about the prospects of these companies. After recent earnings reports showed strong results, shares of Meta, Microsoft, and Alphabet rose. However, Amazon’s shares fell despite forecasting $118.5 billion in spending due to concerns over weaker operating income guidance at its cloud business.
Analysts are cautiously optimistic about the AI industry, with many predicting significant upside potential for some stocks. For example, AMZN is expected to see 20% upside, while Meta is forecasted to gain 13.4%. However, some market observers warn that an AI bubble could form, surpassing the dot-com era.
These companies’ investments in AI are driving growth and generating strong results, but investors should be aware of the potential risks involved.
Source: https://www.tipranks.com/news/this-is-how-much-amzn-googl-msft-and-meta-will-spend-on-ai-this-year