Big Tech's AI Spend: Growth or Cash Burn?

0:00Big tech giants like Alphabet, Microsoft, Meta, and Amazon have dumped hundreds of billions into AI over the past three years, and they're on pace too. Drop around $600 billion this year alone. Investors are glued to their quarterly earnings dropping Wednesday, dying to know if this massive spend is sparking real growth in cloud services and adds to make it worth the cash burn. That spending is hitting hard, squeezing cash flows and forcing tough calls. Meta and Meta have slashed thousands of jobs while Microsoft rolled out employee buyouts for the first time in over 50 years. Wall Street's patience is wearing thin as these cash machines turn into spenders. Folks on the street, like portfolio managers, are laser focused on the return on all that capital investment. These companies used to spit out huge free cash flow, but now it's all getting eaten up by AI builds, flipping their whole business model on its head. How growth should pick up this quarter? With Amazon Web Services eyeing 25%, Microsoft Azure around 40% and Google Cloud at 50.1%.

1:07Overall sales looks solid too, Alphabet up 18.7% to about $107 billion, Amazon 13.9%. To $177 billion, Microsoft's 16.2% to 81 billion, and Meta jumping 31% to 55. Billion on better ad tech. Microsoft's under the hottest spotlight, with its stock tanking worse since the OA crash and low uptake on its $30 a month co-pilot, tool among enterprise users. As rivals encroach and deal shift, leaders there have to prove their turning AI threats into wins before the momentum slips away. That's your update from Canada News Today, powered by AI. I'm Corey with The Story.