A $3.2 trillion global dealmaking frenzy is spurred by AI economy
$3.2 trillion. That is the scale of global dealmaking now directly tied to the AI economy, according to reporting by Business Standard.
Where the cash is going
The spend is staggering and accelerating. Microsoft plans approximately $80 billion in capex for its 2025 fiscal year on AI-enabled data centers, with over half allocated to the United States. Meta's 2025 capex range of $64–72 billion has already been eclipsed by its own forward guidance: the company is targeting $125–145 billion in 2026, roughly doubling its prior-year budget. Amazon expects more than $100 billion this year on AI and cloud infrastructure. Alphabet raised its 2025 capex forecast to about $85 billion.
Beyond the Big Four, the Stargate Project—a joint venture between OpenAI, Oracle, and SoftBank—could deploy up to $500 billion over several years into U.S. AI infrastructure. NVIDIA, riding the GPU demand surge, has ascended into the world's most valuable companies.
On the venture side, Paradigm just raised $1.2 billion to expand investment into AI and robotics, signaling that institutional capital is still willing to write checks upstream of the hyperscaler layer.
The BIS reality check
The Bank for International Settlements is not impressed. In its Annual Economic Report 2026, the BIS warned that more than $1 trillion in AI-related capex across 2025 and 2026 is outpacing current earnings and free cash flow. The comparison it drew: the dot-com era. If expected returns fail to materialize, the BIS cautioned, the fallout could include a sharp spending pullback, a stock market correction, and a credit crisis across private markets.
The numbers back the concern. Spending on advanced chips, hyperscale data centers, cloud infrastructure, and electricity generation is growing faster than revenue. Burn rates at the infrastructure layer are historically high. Liquidity risk is migrating from public equities into private credit structures that backstop the compute buildout.
What to watch next quarter
The AI capex cycle is now too large to evaluate as a technology story. It is a capital markets story. Investors should track three metrics: free cash flow conversion at Microsoft, Meta, Amazon, and Alphabet; utilization rates at hyperscale data centers; and the spread between venture-stage AI revenue multiples and the actual revenue growth rates those multiples imply.
Paradigm's $1.2 billion raise suggests risk appetite persists downstream of the infrastructure giants. But the BIS warning is a sobering reminder: when returns lag capex by this magnitude, corrections do not arrive politely. They arrive fast and across every layer of the stack simultaneously.