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The $320 Billion Reality Check: What This Week's Earnings Actually Reveal

The $320 Billion Reality Check: What This Week's Earnings Actually Reveal

Pranjal Gupta's avatar
Pranjal Gupta
May 25, 2025
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The $320 Billion Reality Check: What This Week's Earnings Actually Reveal
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While everyone's debating Chinese AI models and efficiency breakthroughs, the real story is hiding in plain sight in recent earnings calls: Big Tech is doubling down on AI spending at unprecedented levels, but the revenue justification is getting harder to find.


The Numbers That Tell the Real Story

Here's what the latest earnings reports actually show:

Combined 2025 AI Capex Commitments:

  • Meta: $64-72 billion (raised from $60-65 billion)

  • Microsoft: $80 billion (fiscal 2025)

  • Google/Alphabet: $75 billion

  • Amazon: $100+ billion

Total: $320+ billion in AI infrastructure spending

But here's what's actually generating revenue:

  • Microsoft's AI revenue run rate: $13 billion quarterly

  • Meta AI: 700 million monthly active users (revenue TBD)

  • Google: AI metrics bundled with traditional ad/cloud revenue

  • Amazon: AWS AI revenue bundled with cloud services

The math is brutal: $320B in planned spending vs. Microsoft's $13B confirmed AI revenue run rate (the only company providing specific AI revenue figures).


What This Week's Earnings Actually Revealed

The Pattern Across All Major Players:

Microsoft (Reported Jan 29, 2025):

  • AI revenue hit $13B annual run rate, up 175% YoY, beating CEO's $10B October forecast

  • Capex was $22.6B in Q2 (record high), on track for $80B+ fiscal 2025

  • Translation: $13B AI annual revenue vs. $90B+ annual capex spending

Meta (Reported Jan 29, 2025):

  • Meta AI reached 700M monthly users (Q4), approaching 1B users (Q1 2025)

  • Raised 2025 capex to $64-72B (from $60-65B) due to AI data center investments

  • Translation: Massive user growth, but CEO said monetization focus is "at least the next year" away

Google/Alphabet (Reported April 24):

  • Total revenue $90.23B, ad revenue $66.89B

  • Capex $17.20B in Q1 (43% increase YoY)

  • Translation: Traditional revenue sources funding AI infrastructure buildup

Amazon (Recent):

  • Plans $100+ billion capex in 2025, "vast majority" for AI

  • AWS competing with companies like CoreWeave (420% revenue growth)

  • Translation: Massive AI infrastructure investment, revenue attribution unclear


The Industry Reality Check

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