Hyperscaler 2027 Capex Tops $1 Trillion as AI Buildout Pressures Free Cash Flow
Updated
Updated · Yahoo Finance · Aug 3
Hyperscaler 2027 Capex Tops $1 Trillion as AI Buildout Pressures Free Cash Flow
2 articles · Updated · Yahoo Finance · Aug 3
Summary
$1 trillion-plus in 2027 hyperscaler capex is now the consensus view, up from $929 billion and more than $100 billion above pre-quarter estimates, extending investor worries that AI spending will stay elevated into 2028.
Goldman Sachs said 2026 capex estimates rose a milder $36 billion during earnings season, but spending is still on track to exceed cash flow from operations from 2026 through 2028.
Meta tightened its 2026 capex range to $135 billion-$145 billion from $125 billion-$145 billion and gave no specific 2027 target, while Alphabet lifted full-year guidance to $195 billion-$205 billion from $180 billion-$190 billion after $44.9 billion in second-quarter capex.
That spending stance has hit sentiment: Meta shares are down 7% over five days and 14% this year, while Alphabet stock also fell sharply after its earnings report.
free cash flow has become the key test for hyperscalers funding AI expansion, with the report singling out Microsoft as the only near-term bright spot.