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.
The retreat threatens a long-standing source of support for technology share prices. With companies buying back fewer shares, investors are increasingly dependent on heavy AI investments delivering enough profit growth to justify their valuations.
Microsoft, Alphabet, Amazon, Meta and Oracle returned 9.3% of the cash their businesses generated as dividends and buybacks in the first three quarters of the year, down from 27.4% a year earlier, a Reuters analysis of LSEG data and companies' financial reports showed.
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.