Big Tech to Sustain AI Capex Through 2028 as Alphabet Lifts 2026 Outlay to $205 Billion
Updated
Updated · Yahoo Finance · Aug 31
Big Tech to Sustain AI Capex Through 2028 as Alphabet Lifts 2026 Outlay to $205 Billion
3 articles · Updated · Yahoo Finance · Aug 31
Summary
Goldman Sachs said Big Tech’s AI spending spree is likely to last for years, with supply and demand not balancing until the first half of 2028.
Higher chip and memory prices, plus a rush to secure land and data-center shells before components arrive, are keeping the AI supply chain tight and pushing input costs up.
Alphabet underscored the trend by raising 2026 capital-expenditure guidance to $195 billion-$205 billion from $180 billion-$190 billion after reporting $44.9 billion in second-quarter capex.
Other companies are also stepping up: Tesla plans $25 billion of 2026 capex, while SpaceX spent $18.4 billion in the second quarter and could reach about $65 billion this year versus $50 billion expected by Wall Street.
The spending wave is becoming a market risk as investors question whether massive AI outlays are already reflected in Big Tech valuations; Tesla shares were hit after earnings on capex concerns.
With Big Tech sinking hundreds of billions into AI infrastructure by 2028, are we witnessing a technological revolution or an unprecedented financial bubble?
Investors are punishing giants for massive AI spending, but what happens to the companies that refuse to pay this trillion-dollar entry fee?
As power grids and land availability max out, who will truly control the future of AI when the physical resources run dry?