NEW YORK, May 10 —
- AI Spending Surge: Major technology firms are expected to spend $755 billion on capital expenditures in 2026, according to Goldman Sachs.
- Spending Growth: AI-related capital spending is projected to rise 83% year over year.
- Buyback Slowdown: Goldman Sachs expects S&P 500 share buybacks to grow only 3% this year.
- Capital Shift: Large tech companies reportedly cut stock buybacks by nearly two-thirds in the first quarter.
- Key Players: Companies investing heavily in AI include Amazon, Alphabet, Meta, Microsoft, and Oracle.
- Main Drivers: Data-center expansion and memory-chip shortages are increasing infrastructure costs.
| Metric | Value | Context |
|---|---|---|
| Big Tech capex | $755 billion | Expected AI-related spending in 2026 |
| Spending growth | 83% | Year-over-year increase |
| S&P 500 buyback growth | 3% | Goldman Sachs forecast for 2026 |
| Buyback reduction | Nearly two-thirds | Q1 decline among major hyperscalers |
| Main pressure | AI infrastructure | Data centers and memory chips |
AI Spending Reshapes Shareholder Returns
Major technology companies are pouring record sums into artificial intelligence infrastructure, a spending wave that may come at the expense of shareholder payouts.
According to analysts at Goldman Sachs, the largest AI-focused cloud and technology firms are expected to spend approximately $755 billion on capital expenditures in 2026, reflecting an 83% increase from the previous year.
Buybacks Face Growing Pressure
As companies direct more resources toward AI ambitions, stock buybacks appear to be losing priority.
Goldman Sachs estimates that S&P 500 share repurchases will increase just 3% this year, as economic uncertainty and mounting AI costs push executives to reconsider capital allocation strategies.
Among major hyperscalers, buybacks reportedly fell by nearly two-thirds during the first quarter as firms redirected funds toward expanding data-center capacity and securing high-demand semiconductor components.
Big Tech Bets Bigger on Infrastructure
The biggest beneficiaries of the AI boom — including Amazon, Alphabet, Meta Platforms, Microsoft, and Oracle — are investing aggressively in cloud computing infrastructure to support advanced AI systems.
Industry demand for memory chips and computing power continues to intensify, raising costs and forcing companies to balance long-term growth ambitions with shareholder expectations.
For investors, the shift could signal a period where growth spending takes precedence over dividends and buybacks, potentially changing how technology stocks are valued.
