Amazon keeps $220B capex plan as Big Tech tops $720B

Amazon Amazon.com, Inc. ↗ 6.12% on Thursday, Oct. 29, kept its plan to spend about $220 billion on capital projects in 2026. It was the last of four tech giants to report this earnings season, and its third-quarter spending on property and equipment came in well above Wall Street's estimates. Across the past two weeks, Amazon, Microsoft ↗ 6.68%, Google and Meta ↗ 1.44% have said they plan to put more than $720 billion this year into data centers and other capital investments. That is about three times what they spent two years ago, and all four are expected to spend even more next year, according to The New York Times ↘ 0.92%.nytimes.com+1

The spending has pushed several of the companies to borrow or sell new stock, which has made investors nervous about whether the money will pay off.nytimes.com

Amazon's cash flow turns negative

Amazon spent $77.3 billion on property and equipment in the third quarter. That compares with $35.1 billion a year earlier and an analyst estimate of $58.7 billion Comcast Corporation ↗ 4.99%. Over the past 12 months, free cash flow went from an inflow of $14.8 billion to an outflow of $42.4 billion. The company said this was mainly because of AI investment. Revenue was $201.9 billion and profit was $20.7 billion, both a little short of forecasts. Amazon Web Services grew 39%, and CEO Andy Jassy said Amazon expects "to spend meaningfully more in 2027". Bloomberg reported that the shares fell after the results.cnbc.com+4

Rivals' spending and investor reaction

Google's parent Alphabet ↗ 3.25% missed revenue and profit estimates, and its free cash flow for the quarter was negative $9.07 billion. It kept its 2026 capital spending forecast at $195 billion to $205 billion. Chief financial officer Anat Ashkenazi said spending would "increase significantly in 2027." Alphabet shares fell more than 12% on Thursday.cnbc.com+1

Investors reacted better to Microsoft. It spent $45.2 billion on capital projects in the quarter and now expects about $170 billion for calendar 2026, down from roughly $175 billion, because of delays in getting capacity. Reuters Thomson Reuters Corporation ↗ 6.40% said its cloud growth and cash flow gave investors some "respite" from AI worries.nytimes.com+1

Meta narrowed its 2026 forecast to $135 billion to $145 billion. It then said it would raise up to $95 billion through stock offerings to pay for AI infrastructure.cnbc.com

A wider buildout

The surge is not limited to the biggest four. Oracle ↘ 1.95% and SpaceX have also raised spending and borrowing sharply. David Tsui, who covers technology credit at S&P Global Ratings ↗ 3.36%, told the Times that "slight differences are causing a lot of volatility." He said that uncertainty could last for years because much of the return on the spending is "going to be years down the road".nytimes.com