Amazon, Alphabet, Meta, and Microsoft's combined free cash flow set to hit lowest level since 2014 as AI spending surges to nearly $805 billion this year.

Hyperscalers including Amazon, Alphabet, Meta, Microsoft, and Oracle are projected to spend nearly $805 billion on AI this year, up from an earlier projection of $765 billion, with forecasts for next year raised to $1.1 trillion.

Combined free cash flow of Amazon, Alphabet, Microsoft, and Meta could drop to around $4 billion in the third quarter, down from a quarterly average of $45 billion since the COVID-19 pandemic. Amazon is projected to spend more cash than it generates this year with roughly $10 billion cash burn, while Meta is expected to burn cash in the second half of the year.

Amazon announced plans to invest $200 billion in 2026, marking the largest spending commitment among its peers. Meta has issued $55 billion in debt and halted share buybacks over the past six months. Alphabet refrained from repurchasing shares in the first quarter for the first time since initiating its buyback program in 2015.