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EE Ed Elson Ed Elson Co-Host of Prof G Markets and author of Simply Put.

“What you have is like a one and a half trillion dollar gap between how much money they're going to spend and how much money they actually have. Because remember, they can't use the profits anymore, because those cash flows are negative.”

The Prof G Pod with Scott Galloway · Tech Strategy & Big Tech · November 2026

“What you have is like a one and a half trillion dollar gap between how much money they're going to spend and how much money they actually have. Because remember, they can't use the profits anymore, because those cash flows are negative.” — Ed Elson, The Prof G Pod with Scott Galloway

Context

In a replayed clip, Elson adds up the five biggest AI spenders (Oracle, Microsoft, Meta, Amazon, Google). He puts their capex over the next two years at more than $2 trillion against roughly $600 billion of cash on hand, a gap that has to be filled from capital markets.

Listen to the episode → More from Ed Elson → More Tech Strategy & Big Tech quotes →

Transcript

The Prof G Pod with Scott Galloway Around 14:53 into the episode
Speaker 4

…to be taking out second mortgages for the same renovation, which is going to result in kind of a different call from the bank, if you will. So, really, two divergent results here. And the largest market cap erosion, single-day market cap erosion in the history of the company, that's a big deal.

George Hahn

Alphabet and Amazon aren't the only ones in the red. Ed Elson pointed out that nearly every hyperscaler is now spending more than it makes. And explain what that means for investors.

Speaker 1

But I do think that the real problem, in my view, is that negative free cash flow. And to be clear, Google is not alone there because we also know that Oracle's free cash flow is negative. Meta's free cash flow is negative now. Amazon's free cash flow is negative now. All of the hyperscalers have now entered into negative free cash flow because of how much money they're spending on the data centers. It's nearly $700 billion on CapEx in the past 12 months. That's up nearly 90% from a year ago. The only hyperscaler with positive free cash flow is Microsoft, which is great, but it still came down 27%. So the thing that worries me is the fact that these businesses can no longer use their profits to finance their goals, which is in this case to build data centers and build the AI revolution. And so you think about, okay, well, what can they do then? If the most profitable companies in the world can't even use their profits to do whatever it is that they want to do, well, then you'd say, okay, they can go to the cash on their…

George Hahn

It was a week of election maps, live counts, and market alerts. To close, Stanford psychiatrist Anna Lemke, author of the new book, Radical Surrender, told Scott on Tuesday's bonus conversations episode, how to get out of your own head and back into the world. We just

Speaker 3

have to get out of our own heads. We spend so much time not in reality.

Speaker 4

We have to get out of our heads and we have to be

Speaker names come from our own diarization. The position is estimated from where the line sits in the episode.

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