Despite DeepSeek’s massive wave in the artificial intelligence (AI) space, raising questions about huge capital spending, the U.S. tech giants have chosen to continue to ramp up AI with a clear message: the AI boom will not subside in 2025.
Microsoft, Amazon, Google and Meta have recently said that they will further increase their investment in 2025 after last year’s record spending, and are expected to invest a total of $320 billion in AI technology and data center construction. By comparison, the Big Four will have a total capital expenditure of $230 billion in 2024.
In the face of the impact of DeepSeek, corporate executives and Wall Street analysts said that the release of DeepSeek is unlikely to have an impact on AI investment plans in the short term, however, in the long run, whether large-scale investment in data centers is indeed a question.
Researchers at DeepSeek claim that its AI models outperform OpenAI, but are only a fraction of the cost to build. This has alarmed investors in particular, but executives at U.S. companies have not flinched, touting their technological advances and arguing that lower costs will make AI more affordable and increase demand for the cloud computing services that AI needs to function.
In the face of the emergence of DeepSeek, so far, the US tech giants have not changed their plans to make huge investments in AI development.
The biggest opportunity
Among them, Amazon has put forward the most ambitious spending plan of the four, claiming that its total capital expenditure across all businesses is expected to increase to more than $100 billion this year, and said that most of the increase will be for AI, up from $83 billion in 2024.
Amazon CEO Andy Jassy said on Thursday’s earnings call that the funds will be used primarily for AI and “once-in-a-lifetime business opportunities” in Amazon’s web services division.
“I think our business, our customers and our shareholders will be happy in the medium to long term as we are looking at capital opportunities and commercial opportunities in the AI space,” he claimed. ”
Jassy noted that AI has the potential to drive historic change, and Amazon wants to be a leader in this change. “AI undoubtedly represents the biggest opportunity since cloud computing, and probably the biggest technological change and opportunity in business since the internet.”
Last month, Microsoft said it plans to invest $80 billion in AI data centers in fiscal 2025 and that spending will grow further next year, albeit at a slower pace.
Microsoft CEO Satya Nadella said that more than half of that spending will occur in the United States and that AI will be more widely used, which he believes is good news.
Google’s parent company, Alphabet, said it is accelerating its investment in AI data centers, with capital spending increasing to about $75 billion this year from $52.5 billion in 2024 and expected to reach $16 billion to $18 billion in the first quarter.
Alphabet CFO Anat Ashkenazi said this week that most of the spending would go to “AI infrastructure, primarily servers, followed by data centers and networks”.
At the same time, Meta CEO Mark Zuckerberg set a budget of $60 billion to $65 billion for AI investment, calling 2025 a “decisive year for AI.”
Zuckerberg said: “I still think it’s important to make a big investment…… It will be a strategic advantage in the long run, and this move will help unlock historic innovation and expand America’s technological leadership. ”
In addition, companies including SoftBank, Oracle and OpenAI have pledged to spend $500 billion to build new AI infrastructure in a joint venture called Stargate.
OpenAI announced Thursday that it is evaluating which areas in the U.S. are suitable for data center locations for the Stargate project and has more than $100 billion in funding ready.