Big Tech Is Spending Hundreds of Billions on AI. So Far, Almost Nobody Is Making Money From It
Google, Meta, Microsoft and Amazon all reported their latest financial results this week. Enormous AI spending, thin returns, but millions of new users and a few signs the bets might pay off.
Key points
- Alphabet, Google's parent company, recorded negative free cash flow for the first time in its public history, on revenue of $118 billion.
- Meta's Reality Labs division, responsible for its AI work, lost nearly $9 billion in the first half of 2025.
- Amazon plans to spend $220 billion on AI in 2025, yet strong performance in other businesses pushed its stock to a two-month high.
- Google's Gemini chatbot reached 950 million monthly users, triple its count from a year earlier.
- Apple's outgoing chief executive Tim Cook confirmed plans to charge users for heavy use of a revamped, AI-powered Siri.
The biggest technology companies on earth are burning through cash to build AI. Most of them are losing the race against their own spending.
Free cash flow, the money a business has left after paying for its operations and investments, is the clearest measure of financial health. Alphabet spent so much building AI infrastructure that its free cash flow turned negative for the first time since the company went public. Meta kept less than two cents of every dollar it brought in: $784 million on $61 billion of revenue.
Is anyone actually making money from AI?
Microsoft is the clearest yes. Shares jumped to a six-month high after it showed strong revenue growth and rising adoption of its core AI tools, even while planning to match the $190 billion it spent on AI over the last twelve months. Tracy Woo, an analyst at Forrester, said Microsoft was showing that its massive AI investments were "beginning to deliver returns." Our story from 2 August 2026, "Microsoft soars, Meta sinks", caught this divergence forming.
Amazon told a similar story. Plans to spend $220 billion on AI this year didn't rattle investors, because the company's cloud and retail businesses are growing fast enough to absorb the cost.
Meta and Google face more pressure. Wall Street punished Meta's stock after chief executive Mark Zuckerberg announced plans for an AI agent, software that carries out tasks on your behalf without constant instructions, alongside a business unit to sell AI tools to other companies. Neither product exists yet. Zuckerberg offered no timeline. Meta still raised the floor of its 2025 AI spending above $140 billion.
| Company | Planned AI spend (2025) | Key metric |
|---|---|---|
| Alphabet (Google) | Not stated | Negative free cash flow on $118bn revenue |
| Meta | $140bn+ | Free cash flow of $784m on $61bn revenue |
| Microsoft | ~$190bn | Stock at 6-month high |
| Amazon | $220bn | Stock at 2-month high |
What does this mean for ordinary people?
For most consumers, the immediate news is about Siri. Apple said sales of its iPhone, Mac and iPad are running ahead of expectations, partly on anticipation of a revamped Siri that will use Google's Gemini as its engine. The company can't get enough chips, the specialised hardware that powers AI, to meet demand. Supply is the ceiling now, not interest.
Apple's Tim Cook was direct: heavier use of the new Siri will cost extra. A paid tier is coming. Cook said user enthusiasm from testing was "off-the-charts" and added, simply, "We do believe there will be people who want to use it, a lot."
Google's Gemini already has 950 million monthly users, triple the figure from a year ago. That kind of growth tells you people are curious. Whether enough of them will pay to justify the combined hundreds of billions being spent is the question none of these earnings calls quite answered.
