Big Tech invests over $200B in AI despite mixed results

Amazon, Meta, Alphabet and Microsoft are putting serious money—over $200 billion—into artificial intelligence (AI) this year, banking on their long-term promise despite mixed quarterly results.

Big Tech doesn’t want to miss out on AI and is trying to convince investors that the tech will eventually make their businesses more profitable.

Amazon CEO Andy Jassy called AI a “really unusually large, maybe once-in-a-lifetime type of opportunity” on an earnings call on Thursday. The e-commerce giant is looking to spend a record $75 billion this year to advance its AI and cloud-computing services. The company spent over $22 billion on data centers and chips (81% more than the previous year).

Meta plans up to $40 billion in AI investments this year, focusing on language models. CEO co-founder Mark Zuckerberg defended the large amount, stating AI is improving Facebook and Instagram’s ad business, a core revenue source.

Google parent Alphabet recently announced over 25% of its new code is generated by AI.

Apple is improving its virtual assistant Siri and launched AI-driven Apple Intelligence on all products this week, though these efforts are yet to yield financial results.

Microsoft has invested over $13 billion in ChatGPT maker OpenAI since 2019. However, the Bill Gates company is struggling to meet rising demand for its cloud and AI services, with its facility-building pace lagging behind growth.

Overall
While some Wall Street analysts are hesitant about AI due to its high costs, Big Tech companies are not holding back and believe these investments will pay off and drive the future of technology.