Analysis:AI investment boom puts Big Tech's free cash flow under pressure

July 22 : U.S. hyperscalers are starting to show returns on their artificial intelligence investments, but the rising cost of the buildout is taking a bite out of their free cash flow, and investors are noticing.At their current trajectory, the so-called "hyperscalers" - Microsoft, Alphabet, Amazon, Meta Platforms and Oracle - are expected to spend more combined on capital expenditures than they generate in free cash flow by 2027, according to a Reuters analysis of LSEG consensus estimates. The data shows the companies will generate about $340 billion more in annual operating cash flow in 2027 than in 2025, but capex is expected to rise by roughly $534 billion, equivalent to about $1.57 of additional investment for every $1 of additional cash flow.When those companies report earnings, begi