The world’s largest hyperscalers (Microsoft, Amazon, Alphabet, Meta, and Oracle) are increasing their cash capital expenditures faster than their cash inflows from operations. While the exact point at which cash capex will exceed inflows varies by company, aggregate cash capex across hyperscalers is on track to overtake operating cash flow around Q3 2026. Most hyperscalers have already turned to external financing to fund their growing investments in AI infrastructure, or are considering doing so.
Operating cash flow is a measure of how much money a company makes after paying its expenses but before investments like cash capex: it is lower than revenues (which don’t include expenses) and usually higher than profits (which also deduct depreciation). Revenue and profit use accrual accounting, while operating cash flow is cash-based and reflects only payments actually made or received.
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We compare the aggregate operating cash flow of Microsoft, Amazon, Alphabet, Meta, and Oracle against their aggregate cash capital expenditures, quarterly, on a log scale. Operating cash flow is the cash generated by operations before any investment spending. Cash capex is purchases of property and equipment from the investing section. These companies define “free cash flow” as operating cash flow minus cash capex; if their capex continues to grow on trend, their free cash flow will become zero or negative.
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