Meta, Amazon Q2 2026: capex eats all cash, only Amazon shows payback

Meta and Amazon both reported Q2 2026 results in late July, and both showed the same problem: record capex used up nearly all cash their core businesses produced. Meta's ad revenue rose 27% to $59.36B, and average price per ad grew 12%, yet operating margin slipped to 31% from 43%, and EPS of $6.18 missed the $7.22 estimate. Amazon's AWS grew 37% to $42.23B at a 39.4% margin, but trailing free cash flow fell to -$7.6B, deeper in the hole than Meta. Meta is funding its AI buildout through advertising, and CEO Mark Zuckerberg expects 'significantly higher margin on selling intelligence rather than selling compute directly.' Amazon plays the landlord: its Trainium chips have multi-gigawatt commitments from Anthropic and OpenAI, and CEO Andy Jassy said the company will 'spend a lot of capex and encounter free cash flow headwinds until these data centers come online to be monetized.' Most AI capacity is signed on five-year terms, and servers break even in a little less than three years, giving Amazon a payback map Meta has not published. Meta has taken long-term debt to $83.66B to fund its buildout. Meta is up 9.54% year to date, and Amazon is up 12.61%. The author leans toward Amazon's clearer payback, noting its cash drain looks like a construction loan with tenants already signed.