Amazon among big five as hyperscaler capex set to exceed $600 billion

Hyperscaler Capital Expenditure (CAPEX) for the “big five” (Amazon, Alphabet/Google, Microsoft, Meta/Facebook, Oracle) was forecast to exceed $600 billion in 2026, a 36% increase over 2025. Aggregate capital spending, after buybacks and dividends were included, exceeded projected cash flows and created external funding needs.

Omdia reported that global spending on cloud infrastructure services reached $102.6 billion in Q3 2025, a 25% year-on-year increase and the fifth consecutive quarter with growth above 20%. AWS, Microsoft Azure, and Google Cloud retained their market rankings and together accounted for 66% of cloud infrastructure spending while recording 29% year-on-year growth.

Roughly 75%, or $450 billion, of the big five's projected 2026 spending was tied to Artificial Intelligence (AI) infrastructure such as servers, GPUs, datacenters, and equipment. Hyperscaler AI strategies are shifting toward platform-driven, production-ready approaches that support multi-model strategies and agent-based applications, and they are integrating proprietary foundation models with a growing range of third-party and open-weight models.

Hyperscalers are increasingly leaning on debt markets to bridge the gap between rising AI CAPEX budgets and internal free cash flow, altering historically cash-funded models into ones that used leverage while maintaining strong balance sheets. The providers also increased resources for AI agent lifecycle management, including creation and operationalization, as enterprise-level deployment proved more intricate than anticipated.

“Collaboration across the ecosystem remains critical,” said Rachel Brindley, Senior Director at Omdia. “Many enterprises still lack standardized building blocks that can support business continuity, customer experience, and compliance at the same time, which is slowing the real-world deployment of AI agents. This is where hyperscalers are increasingly stepping in, using platform-led approaches to make it easier for enterprises to build and run agents in production environments,” said Yi Zhang, Senior Analyst at Omdia.

Omdia forecasted that growth of cloud adoption among communications service providers would double this year and projected a 7.3% Compound Annual Growth rate (CAGR) to 2030, resulting in a telco cloud market worth $24.8 billion.