Too big to bail

Alphabet, Microsoft, Amazon, and Meta alone are planning to spend some $660 billion on artificial intelligence this year. Add to that what other AI companies plan to keep spending, which is ever more, and the total goes even higher. In a single year. While “the potential return on these massive investments remains murky.” What could go wrong?

Big Tech, I hear, has been reporting financial results and issuing updates about this year’s plans, with Meta announcing a doubling of its spending plans from $73 billion in 2025 to up to $135 billion this year. Amazon apparently shocked investors by announcing spending plans for $200 billion. Alphabet is planning investments of between $175 and $185 billion, a twofold increase on 2025. Microsoft will be spending $145 billion.

Here’s some completely random context. Exxon plans 2026 capex of between $27 and $29 billion. Chevron’s capex budget is between $18 and $19 billion. Shell plans to spend between $20 and $22 billion. BP has set spending at $10 billion. These four together are spending less than Meta alone. That’s normal, some would say, Big Tech is bigger than Big Oil, so it spends more than Big Oil, it’s just business as usual. Yeah, until we mention the small matter of cash flow. Among other small matters.