Big Tech AI spending squeezes shareholder payouts to 15-year low

Major US technology firms generated record cash amounts in the first nine months of 2026, yet returned the smallest share of it to shareholders in at least 15 years. A financial analysis revealed that surging artificial intelligence spending severely squeezed share buybacks, threatening a long-standing support for technology share prices.

Operating cash flow rose 29% to a record $542.9 billion across Microsoft, Alphabet, Amazon, Meta, and Oracle. However, capital spending driven by the artificial intelligence boom doubled to $556.9 billion, exceeding the cash generated by the five firms and leaving them with a combined free cash flow deficit of $14 billion.

The financial squeeze hit buybacks the hardest, with repurchases plunging 83% to $13.6 billion. Meanwhile, dividends rose to $37 billion, as investors treat them as a firm commitment. Several major players did not repurchase any shares during the period, relying instead on cash reserves, borrowing, or share sales to fund payouts.

Financial experts noted that the drop in buybacks removes a key historical boost to earnings per share. Shareholders are now adjusting to a different arrangement, trading current cash returns for the expectation that heavy artificial intelligence investments will eventually drive sufficient profit growth.