StratonomicsBuybacks vs CapexQ4 2026
Five Tech Giants Spent $413 Billion on Capex in 2025. They Now Invest Like Utilities.
Amazon, Alphabet, Meta, Microsoft and Oracle put 25 cents of every revenue dollar into buildings, servers and equipment in 2025, close to a utility's 26 cents and up from 10 cents in 2019. The other 1,310 large US companies held at 5 cents and returned more of their cash to shareholders.
Executive summary
What happened
- Five companies did 60% of the new investing. Their capital spending rose from $71 billion in 2019 to $413 billion in 2025, or 31% of all capex by large US public companies.
- They now invest like utilities. The five spent 25 cents of every revenue dollar on capital assets. Utilities spent 26 cents. Everyone else spent 5 cents.
- Their cash shifted away from shareholders. Capex took 73% of the cash the five deployed, up from 47% in 2019. Buybacks and dividends took 24%, down from 52%.
- Everyone else followed the economics of their own business. Utilities put 79% of their cash into capex. Technology companies outside the five returned 66% to shareholders. Across all 1,310, the share returned rose to 52% from 48%.
- The equity market turned. In 2026, US nonfinancial companies issued more stock than they retired for the first time since 2021.
What it means
- Boards outside Big Tech: returning cash is the right call for a business without projects that beat its cost of capital. Returning it by default is not. Write the hurdle rate down, and compare your capex with your own industry, not with an average the five now distort.
- Suppliers to the five: 31% of large-company capex now sits in five budgets. Those budgets fell 7% in 2023, then rose 62% and 73%. Plan for the swing, not the trend.
- The five and their investors: a utility earns a regulated return on what it builds. The five earn whatever customers pay for the capacity once it exists, and they pay for the capacity before they know what it will earn.
The full report
Take it to the board
“Five Tech Giants Spent $413 Billion on Capex in 2025. They Now Invest Like Utilities.” as a designed PDF, plus an Excel appendix with every figure behind the exhibits and the company-level data.
1 · The builders
Five companies did 60% of the new investing
In 2019, Amazon, Alphabet, Meta, Microsoft and Oracle spent $71 billion between them on buildings, servers, networks and equipment. In 2025, Amazon alone spent $132 billion. Together the five spent $413 billion.
Capital expenditures, billions of dollars, US public companies with revenue over $1 billion. Labels show the five's share.
Each of the five spent $83 billion on average. The average among the other 1,310 large companies was $0.7 billion. Together, the others still spent more, $928 billion. The growth belongs to the five: 60% of the rise since 2019, while everyone else's capex grew 33%.
2 · The new utilities
Big Tech now spends like a utility
Utilities are the textbook capital-heavy business: power plants, poles and wires, paid for year after year. In 2025 they spent 26 cents of every revenue dollar on capital assets. The five spent 25 cents. In 2019 they spent 10 cents.
Capital expenditures per dollar of revenue, cents, 2016 to 2025
The comparison ends at the spending. A utility earns a return that a regulator sets on what it builds. The five earn whatever customers will pay for the capacity once it is built, and they pay for it first.
As they built, their cash moved away from shareholders. Capex took 73% of the cash the five deployed in 2025, against 47% in 2019. Buybacks and dividends fell to 24% of the total from 52%, though in dollars they still came to $136 billion. Amazon bought back no stock. Oracle bought back almost none.
3 · Everyone else
Different businesses, different math
Read quickly, the rest of corporate America looks timid: 39% of large companies spent more on buybacks than on capital assets. The industry split says something else. Utilities put 79% of their cash into capex, and 3% of them bought back more than they invested. Telecom and media companies put 55% into capex, energy companies 48%.
Share of cash deployed in 2025: capital expenditures, acquisitions, buybacks and dividends
At the other end, technology companies outside the five returned 66% of their cash to shareholders, and financial companies 61%. A software company or an insurer needs few buildings to grow. When it has no project that beats its cost of capital, handing the cash back through buybacks or dividends, or buying growth through an acquisition, is the disciplined choice.
Taken together, the other 1,310 spent 5 cents of revenue on capex in 2025, as they did in 2019, and returned 52% of the cash they deployed. Their spending did not shrink. The five's grew.
4 · The wider economy
The government's own accounts show the same split
The Bureau of Economic Analysis measures investment by every US business, public or private. Since the end of 2019, investment in information processing equipment and software has grown 92%. Everything else businesses invest in, from factories to trucks to research, has grown 44%. Tech now takes 35% of US business investment, up from 28%.
Business investment at current prices, seasonally adjusted, end of 2019 = 100, quarterly to Q2 2026
5 · The equity market
In 2026, companies started selling more stock than they bought back
The Federal Reserve tracks the net flow of stock for all US nonfinancial corporations: new shares sold, minus shares retired through repurchases and through mergers and acquisitions. Every year from 2005 to 2025 was negative. Companies retired more stock than they issued, $350 billion a year on average.
Net equity issuance by US nonfinancial corporations, billions of dollars, seasonally adjusted annual rate, quarterly
In the first quarter of 2026 the flow turned positive, at $205 billion a year. In the second quarter of 2026 it reached $613 billion a year, the highest of any quarter since 2000. The data does not say who sold the stock or why.
For two decades, US companies as a group retired more stock than they sold. If the turn holds, the market is funding growth again instead of retiring stock, and a board planning buyback-led returns is planning against the current. Two quarters make a signal, not a trend. The next two Federal Reserve releases will show which this is.
6 · Risks
The risks, systemic and company-specific
Five budgets now carry 31% of large-company capex, which makes the buildout both powerful and fragile.
| Risk | Who is exposed | What to watch |
|---|---|---|
| Concentrated demand | Makers of chips, servers, power equipment; construction and engineering firms | The five's capex guidance. Their spending fell 7% in 2023, then rose 62% and 73%. |
| Capacity ahead of revenue | The five, their lenders and their shareholders | Revenue from the new capacity against the depreciation it adds as it comes into service |
| Shared inputs | Any company buying power, land, construction or engineers in the same markets | Power prices and construction lead times where data centers cluster |
| A turn in the equity flow | Companies that rely on buybacks to lift earnings per share | Whether net equity issuance stays positive in the next two Federal Reserve releases |
| Risk | Who is exposed | What to watch |
|---|---|---|
| A distorted benchmark | Boards comparing their capex with 'the market' | Capex per revenue dollar against your own industry, without the five |
| Buybacks by default | The 39% of large companies that bought back more than they invested | The hurdle rate projects had to clear, and the projects that missed it |
| One customer, one cycle | Suppliers with one of the five among their largest customers | Revenue share from the five, and contract terms that hold through a pause |
7 · The agenda
What management teams and boards should do
The right move depends on where you sit. Three positions, three agendas.
If you are one of the builders
- Stage the commitment. Release capital against outside evidence, such as signed customer contracts, not against the plan.
- Show the board the depreciation the build creates, year by year, next to the revenue it needs.
- Say which shareholder returns you are giving up, and for how long.
If you sell to the builders
- Treat the five's capex guidance as your demand forecast, with its swings built in.
- Cap the capacity you add against any one customer's orders.
- Write contract terms that survive a pause in the buildout.
If you are everyone else
- Benchmark capex against your own industry, using the figures without the five in this report's appendix.
- Put the hurdle rate in writing. Return what cannot clear it through buybacks, dividends or acquisitions, and say which and why.
- Check what the buildout does to your own costs: power, space, engineers, cloud capacity.
8 · The bottom line
Neither choice is right by default
Capital goes where a board believes its best return is. In 2025, five boards believed it was in their own buildings and servers, at an intensity close to a utility's. Most other boards believed it was in their own shares, and for businesses that need few assets to grow, that is usually the right answer.
Both bets can be right, and both can be made without anyone asking whether they should. The four cases below show what the choice looks like from inside the company, and how each one turned out.
From the Decision Cases
The same choice, up close
Build, buy, or hand the cash back: four decisions from our Decision Records.
Meta Burned $83 Billion on Reality Labs While the Ad Machine Printed $100 Billion a Year
- The choice
- Rebrand and fund metaverse
- How it went
- HeldThe metaverse investment continued and losses grew every year through 2025 while the core business kept funding it.
AWS Began When a Retailer Decided It Was a Technology Company First
- The choice
- Build cloud as independent business
- How it went
- HeldAWS stood, was broken out as its own segment, and proved more profitable than forecast.
Intel Spent $95 Billion to Become Its Own Customer. Then It Fired the Man Who Promised It Would Work.
- The choice
- Pursue IDM 2.0 foundry
- How it went
- Partly heldThe foundry strategy stood but the CEO was pushed out and the government check was trimmed amid mounting losses.
BP Tried to Have It Both Ways on Climate. It Got Neither.
- The choice
- Announce without committing
- How it went
- ReversedBP undid its transformation ambition and pivoted back to oil and gas.
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Read with care
What the data does not tell us
Why. The figures show where the money went, not why. Data centers, AI, cloud demand and interest rates all overlap in these years. This report does not try to separate them.
Whom it counts. US public companies with revenue over $1 billion that report capital spending in their filings, 1,315 in 2025. Each fiscal year is placed in the calendar year it overlaps most, so Microsoft's 2025 is the year to June 2025.
What the cash measures are. Capex, acquisitions, buybacks and dividends are cash paid in the year, as each company reports it. A company that reports none of one is counted at zero. The Federal Reserve figure is different: it nets new stock sold against everything retired.
Industries. Each company's industry is the SIC code on its current SEC record, grouped as the method describes. A company that changed its business is counted in its current industry for every year.
Revisions. Government figures are revised. This edition uses the figures published as of October 15, 2026; the next edition will use the revised ones.
Figures you can quote
Each with its source
Amazon, Alphabet, Meta, Microsoft and Oracle spent $413 billion on capital assets in 2025, almost six times what they spent in 2019.
SEC XBRL filings. Stratonomics, Q4 2026.The five largest corporate spenders put 25 cents of every revenue dollar into capex in 2025, close to a US utility's 26 cents. Other large companies spent 5 cents.
SEC XBRL filings, companies with revenue over $1 billion. Stratonomics, Q4 2026.Five companies accounted for 60% of the growth in capital spending by large US public companies between 2019 and 2025.
SEC XBRL filings, companies with revenue over $1 billion. Stratonomics, Q4 2026.Technology companies outside the five largest spenders returned 66% of the cash they deployed in 2025 to shareholders; utilities put 79% of theirs into capex.
SEC XBRL filings, by SIC industry. Stratonomics, Q4 2026.In the second quarter of 2026, US nonfinancial companies issued more stock than they retired for the first time since 2021: $613 billion at an annual rate.
Federal Reserve, Financial Accounts of the United States. Stratonomics, Q4 2026.Appendix A
Method and sources
Company figures come from the financial statements US public companies file with the SEC, read through the SEC's XBRL frames: one value per company per calendar year. The population is every filer with revenue over $1 billion, a public float above zero, and reported capital expenditures, 2016 to 2025. Subsidiaries that file their own reports are left out so no spending is counted twice. The five are the five largest capital spenders of 2025, held fixed across years. Industry groups follow each company's SIC code: utilities 4900 to 4999; energy 1300 to 1399 and 2900 to 2999; telecom and media 4800 to 4899; health care pharmaceuticals, medical devices and health services; technology computers, electronics, software and instruments; financials 6000 to 6799; consumer and retail trade, food, apparel, household goods and hotels; industrials and materials the remaining mining, construction, manufacturing and transportation codes. Economy-wide figures come from the Bureau of Economic Analysis and the Federal Reserve, downloaded from FRED on October 15, 2026. Nothing is estimated or modeled; shares, ratios and growth rates are computed from the published values.
| Measure | Publisher | Series | Frequency |
|---|---|---|---|
| Capital expenditures, by company | SEC | PaymentsToAcquirePropertyPlantAndEquipment | Yearly |
| Acquisitions, by company | SEC | PaymentsToAcquireBusinessesNetOfCashAcquired | Yearly |
| Stock buybacks, by company | SEC | PaymentsForRepurchaseOfCommonStock | Yearly |
| Dividends, by company | SEC | PaymentsOfDividendsCommonStock | Yearly |
| Industry (SIC code), by company | SEC | EDGAR submissions | Current |
| Net equity issuance, nonfinancial corporations | Federal Reserve | NCBCEBQ027S | Quarterly |
| Capital expenditures, nonfinancial corporations | Federal Reserve | BOGZ1FA105050005Q | Quarterly |
| Business investment, all | BEA | PNFI | Quarterly |
| Business investment, information processing equipment and software | BEA | A679RC1Q027SBEA | Quarterly |
Appendix B
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