AI Boom Boosts Big Tech's Market Value Amid Economic Uncertainty

Big Tech is dramatically increasing its investments in artificial intelligence, with substantial returns drawing in investors. In the April-June quarter, AI significantly boosted demand across internet search, digital advertising, and cloud computing, driving revenue growth for technology giants such as Microsoft, Meta, and Alphabet.

Betting on maintaining this momentum, Microsoft and Alphabet are ramping up spending to alleviate capacity shortages, despite having already invested billions. The results indicate that AI is emerging as a crucial growth driver, although its monetization is still in its early stages, according to investors and analysts.

The positive developments are encouraging for Amazon.com, the largest U.S. cloud provider, which is set to report earnings after market close. This trend demonstrates that increased demand for AI technology is insulating these tech giants from tariff-induced economic challenges impacting other industries.

(With inputs from agencies.)