Plans by major technology companies to spend roughly $600 billion on artificial intelligence in 2026 are heightening investor concerns over profitability and market risk. Shares of Amazon fell sharply after announcing a $200 billion capital expenditure plan, while Alphabet slid after warning that spending could double this year. Meta Platforms also edged lower as markets reassessed the cost of the AI build-out.
Not all tech names moved in the same direction. Nvidia surged on strong demand expectations, while Microsoft and Tesla posted gains. Still, broader indexes ended the week under pressure, reflecting a shift toward de-risking after years of AI-driven optimism.
Investors are increasingly wary that heavy upfront spending is pulling future earnings forward without adequately pricing in risk. The concern extends beyond returns to fears of narrow market leadership and potential disruption across software and data analytics firms. Shares of companies such as Thomson Reuters and RELX have come under sustained selling, with analysts citing competitive threats from rapidly advancing AI models.
The software and services segment has suffered steep losses, erasing about $1 trillion in market value in recent weeks. As Big Tech doubles down on AI investment, markets appear less willing to reward scale alone, focusing instead on capital discipline and the long-term sustainability of returns amid intensifying competition.
