Graph showing declining free cash flow among major tech companies investing in AI.
This is the critical detail that could unravel the AI trade: Nobody is paying for it. | AI News Digest
As major tech companies invest heavily in AI, their free cash flow is declining, raising concerns about the sustainability of this spending. Despite a surge in stock prices, companies like Amazon and Oracle are experiencing negative cash flow, while others like Microsoft remain stable. Analysts remain optimistic about future earnings potential, but a recent report indicates that many businesses see little impact from AI investments. This uncertainty has led to a pause in enterprise AI spending, with some companies, like Meta, even freezing hiring in their AI divisions. The future of AI's economic impact remains uncertain, with investors closely monitoring the situation.
