The biggest US technology companies generated record amounts of cash in the first nine months of 2026 — yet returned the smallest share of it to shareholders in at least 15 years, as surging artificial intelligence spending squeezed share buybacks, a Reuters analysis of company reports and LSEG data has found.
Record cash in, record little out
Microsoft, Alphabet, Amazon, Meta and Oracle returned just 9.3% of the cash their businesses generated as dividends and buybacks in the first three quarters of 2026, down from 27.4% a year earlier. Operating cash flow actually rose 29% from a year earlier to a record $542.9 billion. But capital spending, driven by the AI boom, doubled to $556.9 billion — exceeding the cash the five firms generated for the first time in data going back to 2011. That left them with a combined free cash flow deficit of $14 billion, against a surplus of $143.5 billion a year earlier.
Buybacks first to go
The squeeze has hit buybacks hardest. The five companies cut repurchases 83% to $13.6 billion, from $81.8 billion a year earlier. Dividends, which investors treat as a commitment, rose to $37 billion from $33.9 billion — but buybacks, the flexible lever companies can pause without breaking a promise, have almost disappeared. Alphabet and Meta have not repurchased a single share in 2026, after buying back $66.5 billion in the first nine months of last year. Amazon pays no dividend and has not bought back shares since 2022. Microsoft accounted for nearly all of the group’s remaining repurchases, and even it cut buybacks to $4.4 billion in the September quarter, from $5.7 billion a year earlier. With combined free cash flow negative, the group’s $50.6 billion in payouts was effectively funded from cash reserves, borrowing or share sales.
The company details
Amazon illustrates the squeeze: its capital spending of $75.9 billion in the third quarter was almost 80% more than the $42.4 billion its operations generated, and it raised $48.1 billion of long-term debt in the quarter. Amazon still expects about $220 billion of capital spending this year, and the other companies have signalled further increases.
Why the loss of buybacks matters
Buybacks have flattered per-share earnings for years. Alphabet, for example, reduced its share count by 9.5% between the end of 2020 and 2025 through buybacks, which alone provided a boost of roughly 2% a year to earnings per share even without any increase in profits, according to ING. Technology and communication services stocks account for about 43.5% of US market value, yet MSCI found their shareholder yield was just 0.28% in July, against 1.99% for the rest of the market. With buybacks fading, investors are increasingly dependent on heavy AI investments delivering enough profit growth to justify technology valuations — the same concern behind the more than $2 trillion in market value set to be wiped off the tech-heavy Nasdaq 100 this month, as reported by Reuters.
What to watch
The figures cover the first nine months of 2026 for the five named companies only, and they are a Reuters analysis of LSEG data and company financial reports, not company guidance. The question for shareholders now is whether AI spending produces profit growth fast enough to replace buybacks as a support for share prices — or whether the pause in returns stretches further into 2027.
Related: Intel’s 45% October Plunge Leads S&P 500 Losers as Most Stocks Rose and Nasdaq 100 Faces More Than $2 Trillion October Wipeout as AI-Spending Fears Deepen.
FAQ
Which companies are covered? — Microsoft, Alphabet, Amazon, Meta and Oracle.
How much did buybacks fall? — 83%, to $13.6 billion from $81.8 billion in the first nine months of 2025.
Why did payouts fall? — AI capital spending doubled to $556.9 billion, exceeding the cash the five firms generated.
Sources
- Reuters, 30 Oct 2026 — “Big Tech returns smallest share of cash to shareholders in 15 years, given AI spending”
- Financial Express, 30 Oct 2026
- Kitco, 30 Oct 2026 (Reuters syndication)
