Nvidia faces AI capex challenges as Microsoft seizes opportunities

Big Tech is building the most expensive infrastructure project in corporate history, and the math is starting to get uncomfortable. Hyperscalers collectively spent roughly $380 billion on AI-related capital expenditures in 2025, and that figure is projected to balloon to between $660 billion and $690 billion by 2026. The spending spree in numbers Microsoft is leading the charge. The company is guiding toward AI-related expenditures exceeding $120 billion in fiscal 2026. Its most recent fiscal Q3 saw spending between $34.9 billion and $37.5 billion, a 75% year-over-year increase. Behind that spending sits an Azure order backlog of $80 billion. The company’s data-center lease commitments now exceed $300 billion. Aggregate hyperscaler AI infrastructure commitments from 2025 through 2027 are projected to approach or exceed $1 trillion. Nvidia’s dominance and its discontents Nvidia captures an estimated 90% of AI accelerator spending. At current buildout rates, that translates to approximately $180 billion in annual GPU purchases. The first risk is customer concentration. When your revenue depends on five or six companies making enormous, synchronized bets on a technology whose monetiza...