While the market is still debating whether AI capital expenditure is starting to slow down, two pieces of news emerged today.

1. Meta plans to invest $10 billion to build a data center in Canada.
2. Amazon plans to invest $5 billion to build a data center in the Philippines.

The biggest concern in the market recently has been whether cloud vendors will start cutting AI CapEx. If the giants are really about to hit the brakes on capital spending, it’s hard to explain why several of them are still laying out new data centers around the world.

Of course, these two investments do not mean all worries have disappeared, nor can we conclude from just two news items that capital spending will definitely keep accelerating. We still need to wait for the upcoming earnings reports and conference calls from the major tech companies.

My view is that capital spending will not decrease. The giants will not voluntarily cut AI capital expenditure. The AI arms race is far from over.