Big Tech companies are sharply increasing capital expenditure as rising prices for chips and memory reshape the economics of artificial intelligence infrastructure. Total spending across major firms has surged to a record $725 billion, driven largely by the escalating cost of AI hardware needed for data centers and model training. Microsoft alone has attributed around $25 billion of its AI budget to higher chip and memory expenses, while Meta has raised its forecast by $10 billion due to similar pressures. Google Cloud also reported strong growth, reflecting continued demand for large-scale computing capacity. Industry leaders say the surge is being fueled by intense competition for advanced semiconductors, limited supply chains, and the rapid expansion of AI workloads across products and services. As companies race to scale AI systems, hardware constraints are becoming a critical bottleneck, forcing tech giants to invest heavily just to maintain development pace and infrastructure stability.
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