Tech Giants Pour Billions into AI as Investors Demand Revenue Growth

The latest earnings season has seen tech giants Apple (AAPL), Alphabet (GOOGL), Microsoft (MSFT), Meta (META), and Amazon (AMZN) report strong growth in spending on artificial intelligence. The companies are ramping up their investments in data centers and AI infrastructure, with estimates suggesting a 6% increase in combined capex for 2026 and a 14% rise for 2027.

Apple beat expectations but saw its stock fall 7.4%. The company's demand for iPhones and Mac computers remains strong, but it is constrained by a chip shortage and rising memory costs. Services revenue grew more slowly than expected, which may have contributed to the decline in Apple's shares.

The other tech giants are also investing heavily in AI, with Alphabet raising its 2026 capex forecast from $180-190 billion to $195-205 billion. Microsoft did not raise its spending outlook, but revenue from its Azure cloud platform increased 43% year over year. Amazon Web Services lifted revenue by 36.7%, and its operating margin was 39.4%. The company also increased its investment plans from roughly $200 billion to $220 billion.