Meta Platforms

The arithmetic is brutal: Alphabet, Amazon, Meta, and Microsoft will collectively burn through $650 billion in 2026, mostly on AI infrastructure that generates no immediate revenue. Meta hiked its capex outlook to $145 billion yesterday and promptly shed $950 billion in combined market value across the four companies. Microsoft reported a 66% quarterly jump in spending, while Amazon plans $200 billion on data centers. The scale dwarfs Belgium's GDP and makes 21 other major US firms look quaint with their combined $180 billion. Investors are finally asking the obvious question: where are the returns?

Meta stock fell 13% this week after the company raised 2026 capex guidance to $145 billion, driven by AI infrastructure and a Texas data center that ballooned from $1.5 billion to $10 billion. Legal defeats in New Mexico and Los Angeles compounded investor anxiety, while the company delayed rolling out a new AI model due to performance issues. Meta is simultaneously cutting hundreds of jobs to contain costs while pursuing what executives call "frontier ambition" in superintelligence. The 28% drop from recent highs reflects a broader reckoning: investors are no longer willing to fund massive AI bets without clear monetization timelines. Analysts still see 62% upside to $850, but that requires faith in returns years away.