What spooked investors were some daunting capital expenditure numbers on AI computing power and model development. Alphabet, for one, said it did $13 billion in capex last quarter and expects to do the same in this one while Meta upped its full-year projected spending to $38-40 billion. The giants are in a spending war as each tries to outrace the others toward AI supremacy.
The Six are booking $1.8 trillion in annual revenues, a number that would put their combined inflows in 10th place of global country rankings if we viewed them as a proxy for national GDP - just behind the gross output of Brazil's 220 million people. Meanwhile, The Six have a combined market capitalization of $15 trillion, capturing an astounding one third of the entire S&P 500 index.
Despite - or perhaps because of - this unprecedented scorecard, these companies are relentlessly competing for world domination. Doing what great American companies have always done, they're unleashing a competitive instinct that, in a normal capitalist economy of diversified goods and services, is the core driver of technological progress.
Worry about us. Because our problem amid the dizzying advance of AI is definitely not one of a shortfall in technological progress.
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