Source: Fortune
Summary
Big Tech companies, including Microsoft, Meta, and Google, have reported increased spending on AI infrastructure, with capital expenditures expected to grow significantly in 2025. Meta raised its capital expenditures guidance for 2024 to $38-40 billion, while Microsoft reported positive growth for its AI business, with a revenue run rate expected to surpass $10 billion in the current quarter. Google touted the boost its cloud business has received from the AI boom, with AI writing over 25% of new code at the company.
Our Reading
The numbers tell one story.
Meta’s Mark Zuckerberg framed AI as a win for its core ad business, but the company is relying on ad revenue to foot the bill for its AI investments. Microsoft’s investment in OpenAI has resulted in massive losses, with a $683 million expense on its equity investments for the quarter. Google’s AI is writing over 25% of new code, but engineers still review the work before using it. The AI spending spree continues, with no signs of slowing down.
As the AI boom boosts profits, will we hear about increased efficiency of AI coding or layoffs of expensive engineers on future earnings calls?
Author: Evan Null
