Companies such as Amazon, Microsoft, and Alphabet are actively advancing their spending plans in the field of artificial intelligence, once again demonstrating strong demand for chips and related equipment—offering a glimmer of hope for an industry that has recently suffered significant setbacks.
Amazon raised its full-year capital expenditure forecast on Thursday from the previous $200 billion to $220 billion. CEO Andy Jassy said most of the spending will go toward artificial intelligence.
This outlook report is part of a series of earnings reports released by so-called hyperscale cloud providers—the world’s largest cloud computing companies—indicating that their ambitions to build artificial intelligence infrastructure remain undiminished.
Microsoft confirmed its capital expenditure forecast, excluding the impact of accounting rule changes. Alphabet, Google’s parent company, raised its spending outlook, while Meta Platforms Inc. increased the lower end of its capital expenditure guidance.
This is good news for companies producing chips, networking equipment, and other data center technology products, which had previously seen their stock prices pressured by market concerns over potential spending slowdowns.
According to Bloomberg Industry Research analysts Kunjan Sobhani and Oscar Hernandez Tejada, their outlook for the coming year is now improving.
They stated in the report: “As most major hyperscale data center operators have raised or reaffirmed their capital expenditure plans in earnings reports, the likelihood of upward revisions to forecasts for computing and networking chipmakers in 2026–27 is increasing.”
Amazon investors praised its performance, which showed cloud computing revenue accelerating for the fifth consecutive quarter. This signals that the company’s aggressive spending is beginning to pay off.
Microsoft also received a similarly enthusiastic response. On Thursday, the company reported its fastest cloud computing growth in four years, boosting its market value by nearly $500 billion. This $450 billion increase marked the largest single-market-value surge in the company’s history.
Investors have a less favorable view of Meta and Alphabet. Both companies are facing concerns about spending that is not yielding clear returns.
Meta, the parent company of Facebook and Instagram, saw its stock drop nearly 8% on Thursday after releasing its earnings report. The company reported weak sales outlook but simultaneously pledged to invest nearly $700 billion in the future.
Ken Gabriel, an analyst at Wells Fargo, said that simply proving a company is investing heavily in artificial intelligence is no longer enough. He noted that investors are increasingly looking for returns.
He said, “Looking back 12 to 18 months ago, the market focused on how much capital you could invest and how much capacity you could bring online. Now the market has shifted, naturally placing emphasis on return on investment.”
