Overview
- Amazon plans about $200 billion in 2026 capital spending, Alphabet roughly $180 billion, Microsoft more than $140 billion, and Meta near $125 billion to expand AI data centers.
- Investor skepticism over returns has pressured mega-cap shares, with Amazon and Microsoft more than 20% below recent highs and the Magnificent Seven ETF down nearly 11%.
- Nvidia’s stock has stayed range‑bound for months despite soaring AI budgets, and analysts flag its upcoming earnings and outlook as a key catalyst.
- Suppliers are viewed as near‑term beneficiaries, with TSMC lifting 2026 capex to about $54 billion and continued demand highlighted for Nvidia, Broadcom, and operators like Applied Digital.
- UBS warns capex growth could moderate, hyperscalers’ in‑house chips such as TPUs and Trainium may temper long‑term GPU reliance, and Oracle’s $300 billion OpenAI pact raises financing and concentration risks after plans to raise $45–$50 billion.