WSJ: The Week the Cracks in the AI Trade Grew Deeper
The five biggest tech firms cut buybacks 83% as AI capital spending pushed combined free cash flow to a $14 billion deficit, Reuters analysis found.
- On Friday, Oct 30, the five largest US tech companies reported record operating cash flow of $542.9 billion yet returned the smallest share of capital to shareholders in at least 15 years as AI spending squeezed buybacks.
- Surging artificial intelligence investments caused capital spending to double to $556.9 billion, leaving the five firms with a combined free cash flow deficit of $14 billion for the first time since 2011.
- The five companies cut repurchases 83% to $13.6 billion from $81.8 billion a year earlier, while dividends rose to $37 billion from $33.9 billion during the first nine months of 2026.
- Alphabet and Meta Platforms halted buybacks entirely in 2026, while Microsoft cut its quarterly repurchases to $4.4 billion from $5.7 billion as $50.6 billion in payouts were funded through debt or share sales.
- Forward AI data-center commitments across the five companies total more than $3 trillion, with Amazon pricing $25 billion in bonds on October 29, its first US dollar bond sale since 2017.
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Big Tech Now Spends More on AI Than It Brings In From Operations
The post Big Tech Now Spends More on AI Than It Brings In From Operations appeared first on 24/7 Wall St.. Through the first nine months of 2026, Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL), Amazon (NASDAQ:AMZN), Meta Platforms (NASDAQ:META) and Oracle (NYSE:ORCL) together spent $556.9 billion on capital projects, mostly AI data centers. Their combined operating cash flow, which is the cash a business brings in from customers a…
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Stocks close sharply lower on AI fears
NEW YORK — Stocks tumbled on Friday, with the Nasdaq suffering its largest one-day percentage drop since June 5 after disappointing quarterly results from Intel and Amazon, which amplified growing worries surrounding AI-related companies' massive spending on the nascent technology.
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