Alphabet rises, Meta falls on capex plans

Alphabet and Meta both reported higher capital expenditure plans this week, but markets reacted in opposite directions. Alphabet shares rose roughly 5% while Meta dropped about 10%, a split that reveals how closely investors are watching the returns each company is generating on its AI spending. Capex, capital expenditure, refers to money spent on physical infrastructure like data centers and chips, typically to support AI workloads. For Alphabet, investors appeared reassured that its core search and cloud businesses are growing fast enough to justify the spending. Meta's heavier spend, by contrast, raised concern that costs are scaling faster than near-term revenue can absorb. The divergence matters across the tech sector because both companies are among the largest buyers of AI infrastructure globally. Watch whether other hyperscalers like Microsoft and Amazon face similar investor scrutiny when they report, and whether either company revises guidance on the pace or payoff of its AI buildout.