Forget revenue. Forget profit. This week’s tech earnings are all about one thing: spending.
DeepSeek’s shock debut of an AI chatbot that’s nearly identical to ChatGPT, but created at a fraction of the cost, has put Big Tech’s massive AI investments under a harsh spotlight.
Since 2020, these four Big Tech heavyweights, aka the hyperscalers, have more than doubled their capital spending, hitting an estimated $222 billion in 2024 compared to just $98 billion four years ago, according to LSEG. And Meta is already planning to drop up to $65 billion this year just to expand AI infrastructure.
Read more: Chips are down! What does Nvidia’s $600 billion sell-off tell you?
Now, all eyes are on whether the DeepSeek curveball will change all this. Analysts are already buzzing about the possibility of some of these giants slowing down their AI spending frenzy.
What used to be music to the market’s ears ( 🎵 “More AI spending!” 🎶) is suddenly a red flag. 🚩
Could Big Tech’s capex bubble be set to pop?
Edited by Tim Hume. If you have any tips, ideas or feedback, please get in touch: talk-to-us@moniify.com
