The Mag 7 just lit a $710B fire under AI

The AI spending spree got a little unhinged

The Mag 7 didn’t just whisper “we’re investing in AI.” They basically shouted it through a megaphone. Amazon, Microsoft, Google, and Meta now say they’ll spend a combined $710 billion on capex in 2026, with Amazon at $200 billion, Microsoft at $190 billion, Google at $185 billion, and Meta at $135 billion.

That’s not a budget. That’s a moon-launch.

The market picked favorites

The weird part? The market isn’t reacting to the size of the checks as much as what those checks do.

• AAPL, AMZN, and GOOGL got rewarded because investors can already see the money machine.
• META and MSFT got slapped around a bit because the payoff is still more “someday” than “next quarter.”

In other words: if your AI spend is already helping sell cloud, ads, or chips, Wall Street claps. If it’s still a giant promise with server racks attached, Wall Street gets twitchy.

“We are compute-constrained” is the new corporate battle cry

Google CEO Sundar Pichai said the quiet part out loud: “We are compute-constrained.” Translation: demand is there, but the company doesn’t have enough computing power to satisfy it. That’s a nice problem to have — unless you’re the one writing the capex check.

Meanwhile, Apple’s blowout quarter and $100 billion buyback helped lift the broader tape, but the AI spend story is the one investors will keep circling. Because once a company says it needs more compute to keep growth rolling, the arms race gets real fast.

Big picture

This is the point where AI goes from hype cycle to infrastructure binge. The winners are the companies that can turn capex into revenue without making your CFO need a nap. The losers? Anyone who spends like it’s a must-win Super Bowl and gets billed like a data center with no payback plan yet.