Cracks are emerging in the AI spending boom

Investors are growing increasingly anxious about massive artificial intelligence infrastructure spending by Big Tech companies, leading to market pullbacks and stock drops. Alphabet, Amazon, Meta, and Microsoft have outlined plans to spend over $740 billion in capital expenditures this year, raising concerns about negative free cash flow, mounting debt, and whether these investments will yield sufficient returns. Meanwhile, some core advertising and search businesses are seeing growth slow down as new AI features cannibalize existing revenue streams. Open article →