Major technology companies have spent a combined $408 billion in capital expenditures in 2025, with spending projected to rise to $738 billion in 2026 and $854 billion in 2027. There appears to be little sign of a slowdown, as the vast majority of these investments are directed toward AI infrastructure, semiconductors, and data centers. This wave of spending has been a major driver of this year's equity market rally. The key question for investors is what happens if one of the largest technology companies begins to scale back its AI investments. Given the highly competitive nature of the industry, a reduction in spending by one market leader could encourage others to follow. If history is any guide, capital spending trends among mega-cap technology companies often move together, raising the possibility of a domino effect across the sector.
Source: Bloomberg, First Trust, The Business Week Graphic; 5/29/2026
*Actual and projected CapEx from Amazon, Microsoft, Google, Meta, Oracle.
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