HOW TO JUDGE THE REAL EFFECTIVENESS OF AI SPENDING BY LARGE TECHNOLOGY COMPANIES IS STILL TO BE TESTED

Coinpaper reported that, while large technology companies invest hundreds of billions of dollars in artificial intelligence, rising AI capital spending does not necessarily mean that these investments create value for shareholders. The key issue for investors is whether Microsoft, Amazon, Google or Meta spending on GPU and data centres generates sufficient additional income and free cash flows to generate attractive investment returns. According to Coinpaper, capital expenditure for the five mega-enterprises in the United States will reach approximately $697.0 billion in 2026 and is expected to consume 93 per cent of operating cash flows, up significantly from 33 per cent in 2023. In the second quarter of 2026, for example, Microsoft, whose capital expenditure was approximately $41 billion, Azure and other cloud services received an increase of 43 per cent over the same period. Google cloud revenues grew by 82 per cent to $24.8 billion. Alphabet spent $80.6 billion on capital in the first half of the year and is expected to increase to 1950 to $20.5 billion throughout the year. Investors should be concerned about whether capital expenditure is accompanied by faster growth in related business。