Tech Mega Cup spends over $300 billion in 2025 to win with AI
Last year, Megacap technology companies poured billions of dollars into artificial intelligence to meet the free demand. Hype won’t die in 2025.
Meta, Amazon, alphabet and Microsoft It plans to spend up to $320 billion on AI technology and data center build-outs in 2025 through comments from the CEO and revenue calls over the past two weeks.
This is up from 2024 total capital expenditure of $200 billion.
The tech company has been pouring billions of dollars into AI projects since ChatGpt’s 2022 debut to expand its data centers and advance models with Nvidia’s graphics processing unit (GPU). The recent rise of China Deepseek sent shockwaves It is estimated that through the sector it will cost just a small portion of some US-based competitors that open source tools can create.
Those fears spurred Market sales last week, push AI Chipmakers Nvidia and Broadcom It will reduce a total of $800 billion in one day. This development forced US tech CEOs to follow questions about heavy spending plans and whether they were all necessary.
The answer is that so far they haven’t slowed down.
Amazon offers the most ambitious spending initiative of the four, aiming to fire Over $100 billionup from $83 billion in 2024. CEO Andy Jassie Company revenue call On Thursday, the money will primarily go towards AI for the Amazon Web Services Division and “a once-in-a-lifetime type of business opportunity.”
“I think both our business, our customers and our shareholders will be happy and pleased in the medium to long term that we are pursuing capital and business opportunities in AI,” he said.
Last month, Microsoft said it would. Allocate $80 billion In 2025, creating data centers for AI workloads. More than half of that spending is poised to occur in the United States, said Brad Smith, the company’s president. Microsoft’s fiscal year ends in June.
alphabet The target is $75 billion With capital expenditure this year It is expected to be between $16 billion and $18 billion First quarter. Financial Director Anat Ashkenazi said in a revenue call on Tuesday that the majority of spending will be “mainly followed by server technology infrastructure, as well as data centers and networking.”
Meanwhile, Meta CEO Mark Zuckerberg Set up AI Capex for his company Budgets of $60 billion to $65 billion January, 2025 will be called the “year of definition of AI.” in Facebook Postshe said the move “will help unlock historical innovation and expand American technology leadership.
The other three of the so-called epic 7 are Apple, Tesla and Nvidia.
appleAI spending is difficult to predict and often appears in operating costs as it stores training capabilities from cloud providers. That’s the model that supports Apple Intelligence. Trained on Google Cloudfor example. Apple also rents cloud capacity from AWS and Azure.
“In the CAPEX part, we take a hybrid approach to doing things internally, and it’s important to remember that each business has a specific partner who does business outside where CAPEX appears. “That’s what CEO Tim Cook said. Last year’s revenue call.
Tesla After the revenue report in late January, AI-related capital expenditures were around $5 billion in 2024, about $5 billion out of a total of $11.34 billion. The company expects AI spending to remain flat every year.
Tesla has built a “training cluster” called cortex at its Texas facility, which it uses to train the models behind the autonomous driving technology and humanoid robotics of the company currently under development.
Nvidia will not report results until later this month. And Capex’s numbers look very different as Nvidia develops and supplies AI technology rather than buying it.
For Amazon, Google and Microsoft, AI spending is high, but it should bring great benefits, a major growth driver for the cloud business. They all say their clients are looking for more AI processing tools and are planning to run larger workloads in the cloud.
However, in the most recent quarter, cloud counts have been weaker than expected, with all three companies not reaching consensus estimates. The main reason was the lack of supply.
“We expect these constraints will really start to relax in the second half of 2025,” said Jassy of Amazon.
At Microsoft, the AI side of Azure Cloud Business was better than management expected, but outside of AI, Azure lags behind internal forecasts due to disappointing sales to clients through partners . Microsoft is revamping its sales approach when it comes to balancing the more traditional IT processes of AI, Hood said.
– Reported by CNBC’s Jordan Novel, Lora Colodney, KIF Reswing, Jonathan Banian, Ashley Caput, Jennifer Elias and Annie Palmer
clock: Expect Amazon’s growth to slow down in the short term