The biggest U.S. technology companies are beginning to show tangible returns from their massive investments in artificial intelligence, but the escalating cost of building AI infrastructure is weighing on free cash flow and increasingly drawing investor scrutiny, according to a Reuters analysis of LSEG consensus estimates.
As the world's largest cloud providers — Microsoft, Alphabet, Amazon, Meta Platforms and Oracle — continue to expand AI capabilities, capital expenditure is expected to outpace free cash flow generation over the next several years. Based on current analyst estimates, the five companies are projected to spend more on capital expenditures than they generate in free cash flow by 2027.
