The chart shows that Alphabet, Amazon, Meta, Microsoft, and Oracle collectively repurchased approximately $9 billion in the first quarter, a near-decade low and more than 80% less than the peak of approximately $50 billion in 2021. Meta's first-quarter repurchases were zero, compared to $12.75 billion in the same period last year. Bloomberg statistics show that among the four major AI spenders—Alphabet, Amazon, Meta, and Microsoft—only Microsoft is still conducting share buybacks.
This reflects a shift in the capital allocation of tech giants from shareholder returns to data centers, chips, and network equipment. The five companies' annual capital expenditure expectations have been revised upwards from approximately $485 billion at the beginning of the year to approximately $730 billion, simultaneously compressing short-term free cash flow and buyback capacity.
While reduced buybacks won't directly determine a stock price decline, it signifies a weakening of the stabilizing forces that reduce outstanding shares, offset equity incentive dilution, and absorb selling pressure. Tech stock valuations will become more dependent on the timely realization of AI revenue and cash flow.
