Big Tech's AI spending spree faces investor doubts

Big Tech stocks fell sharply this week, with Google experiencing its worst day ever and Intel its biggest drop since the Nixon administration, as investors question whether massive AI infrastructure spending is justified by profits. The Nasdaq is near a correction. AI spending has reached $1.6 trillion since 2023, with annual costs expected to hit $1 trillion for a decade, financed heavily by debt. Hyperscalers like Google and Amazon will borrow about $250 billion in bonds this year, with Goldman Sachs estimating $510 billion in available top-tier debt. The bond market remains supportive, but the key risk is how long lenders will sustain this spending spree. While hyperscaler cloud revenue grew 50% and demand is strong, rising borrowing costs or prolonged profit delays could shift sentiment and threaten the AI buildout.