AI Capex Surge Sparks Investor Anxiety as Big Tech Free Cash Flow Turns Negative

Investors are growing wary of the AI infrastructure spending boom just as Alphabet, Amazon, Meta and Microsoft pledge more than $740 billion in capital expenditures this year. The Nasdaq fell 2.9% on Friday, with Nvidia down 4%, Broadcom more than 5% and Qualcomm 11%, as concerns mount over negative free cash flow, rising debt and uncertain returns. Alphabet reported negative free cash flow of $9.1 billion in the third quarter, its second consecutive quarter in the red, even as capex rose to $51.4 billion; it expects up to $205 billion in spending this year. Search advertising growth slowed to 12%, its weakest pace in five quarters. Amazon posted negative free cash flow of $42.4 billion over the past 12 months versus positive $14.8 billion a year earlier, and guides to $220 billion in capex. Meta reported negative free cash flow of $2.1 billion. Microsoft was the exception, with $18.6 billion in positive free cash flow. Microsoft, Alphabet, Amazon, Meta and Oracle raised a combined $326 billion in debt in 2026, triple last year's total, according to S&P Global Market Intelligence. The Financial Times reported Friday that Blackstone warned Anthropic, which filed to go public this week, may not qualify for an investment-grade rating after its IPO.