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Big Tech’s $600–$660 Billion AI Buildout Deepens Software Selloff as Chip Stocks Climb

Concerns center on uncertain returns alongside the risk that advanced AI tools undercut established software vendors.

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Overview

  • Amazon, Alphabet, Meta, and Microsoft outlined roughly $600–$660 billion in AI spending for 2026, a jump of about 60% from 2025.
  • On Friday, Amazon fell more than 5%, Alphabet slipped about 2.5%, and Meta lost 1.3%, while Nvidia jumped 7.9% and Microsoft rose 1.9%.
  • The S&P 500 Software & Services index dropped nearly 8% for the week, with about $1 trillion in market value erased since January 28.
  • Heavy selling in software and data names followed Anthropic’s new Claude plug-in for enterprise tasks such as automated contract review.
  • Nvidia’s Jensen Huang said spending reflects “very high” demand and called fears of AI replacing software “illogical,” as strategists flagged ROI uncertainty and increasingly narrow megacap leadership.