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Three of the biggest US tech giants—Microsoft, Meta, and Google—sent investors a blunt message when they reported quarterly earnings on Wednesday: Their lavish spending on AI infrastructure is only just getting started.
Meta said that its capital expenditure would total between $70 billion and $72 billion this year, up from its previous lower forecast of $66 billion to $72 billion. Next year, Meta’s chief financial officer Susan Li said that she expected the company’s spending would be “notably larger.” The social media giant’s soaring investment matches its soaring revenue: Meta reported raking in $51.24 billion last quarter, up 26 percent year-over-year.
CEO Mark Zuckerberg said the company would keep pouring money into infrastructure to meet rising demand for AI and to prepare for potential major breakthroughs in the technology. “There’s a range of timelines for when people think that we’re going to get superintelligence,” Zuckerberg said on a conference call with analysts. “I think that it’s the right strategy to aggressively front-load building capacity, so that way we’re prepared for the most optimistic cases.”
Meta has moved aggressively to recruit AI talent in recent months, offering some researchers compensation packages worth hundreds of millions of dollars. The company also cut some 600 jobs last week in what it said was an effort to make its AI teams more efficient. Meta has reorganized its AI teams numerous times over the past eight months.
Meta assured investors that its AI investments were already reaping rewards for the company, but didn’t share many specifics. Meta did say AI was benefiting the company’s ad business and virtual reality product lines, and predicted it would propel those divisions to new heights in the future.
Google’s parent company, Alphabet, said it expected its 2025 capital expenditures to be between $91 billion to $93 billion. Earlier this year, Alphabet estimated that number would be just $75 billion. Like at Meta, the increase in spending was matched with an increase in revenue. The tech giant said it earned a record $102.3 billion in the third quarter, up 33 percent from a year ago.
Most of Alphabet’s spending will likely be funneled into data centers and other artificial intelligence initiatives. Google said it earned $15.15 billion from its cloud business in the third quarter, a 35 percent increase from the same period in 2024. Gemini, Google’s general purpose AI app, now has 650 million monthly active users, up from 450 million last quarter. (For comparison, OpenAI CEO Sam Altman recently said that ChatGPT has 800 million weekly users.)
Microsoft reported revenues of $77 billion for the quarter ending on September 30, up 18 percent from a year ago. Its cloud business revenue was up 26 percent year-over-year. Its capital expenditures were $34.9 billion this quarter, with much of the investment going toward AI infrastructure. That figure is nearly $5 billion more than previously forecasted, and a 74 percent jump up from the same quarter a year ago.
