Real Alpha
Try Pro free

The Weekly Show with Jon Stewart · 3 min · Oct 28, 2026

Why Zitron says AI labs' spending differs from Amazon's buildout

Ed Zitron · Founder & CEO, EZPR

Ed Zitron contrasts Amazon's $29.7 billion in inflation-adjusted capex over 12 years with AI labs' recent fundraises.

In this episode

Full analysis
  1. 22:53Why Zitron says AI labs’ compute commitments require huge growth5 min
  2. 27:49Why Zitron says AI labs depend on a brittle customer base4 min
  3. 33:31Why Zitron says AI labs' spending differs from Amazon's buildout3 min
Up next · Pod Save AmericaWhy Pfeiffer sees a wider Senate map for Democrats4:18
“For everything, actually, all of their capital expenditures for the logistics network, for the cloud, for everything, was $29.7 billion adjusted for inflation.”
Ed Zitronat 34:43 · The Weekly Show with Jon Stewart
34:43

Takeaways

  1. Zitron says Amazon spent $29.7 billion total over 12 years.
  2. He compares that with Anthropic's $30 billion and $65 billion raises.
  3. He says AI labs lease data centers and chips rather than owning them.

About this segment

Ed Zitron contrasts Amazon's $29.7 billion in inflation-adjusted capex over 12 years with AI labs' recent fundraises. He says the labs lease rather than own data centers and chips.

Ed Zitron

Ed Zitron is CEO of EZ Primary Research, writer of Where’s Your Ed At? and host of Better Offline.

Hosts Better Offline and writes Where's Your Ed At, a prominent critic of AI industry hype.

From “Data Centers, Debt & the Risks of AI’s Finances w/ Ed Zitron | The Weekly Show with Jon Stewart”, Oct 28, 2026. Watch the full episode

Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

  1. 33:43

    I remember when Google came out and they had these wild valuations and they were getting crazy amounts of venture capital and people were saying, how do they make money? It's you're building out all of this. They didn't call it compute then, but it was the network. You had to build out, you know, fiber optic networks that were taking over some of the dot com bubble build out shit. And but how are they going to make any money?

  2. 34:08

    and over time though it did turn into a profitable business whether it was through advertising or the selling of data or other ways that they made money either by sucking up other companies or things like that are we missing that same story with ai are we being too too skeptical about how they can turn this into a profitable business so let's take amazon amazon is the one people like to choose Amazon Web Services, which is their cloud platform, one of the most profitable businesses in history, incredible stuff. Founded in 2003, I think it was available to the public in 2006, profitable in 2015. Amazon's combined capital expenditures in that period- To build out cloud capacity.

  3. 34:56

    For everything, actually, all of their capital expenditures for the logistics network, for the cloud, for everything, was $29.7 billion adjusted for inflation. For some context- Over how long a period? 12 years, between 2003 and 2015. And that's not per year, that's total. That's the total capital expenditures. $30 billion. And Anthropic raised $30 billion in February. They raised $65 billion in May.

  4. 35:22

    Amazon spent, I think, $45 billion in CapEx in the last quarter. And here's the thing as well. Amazon at that time was a much smaller company. So if you invested in Amazon at that point, you were having an incredible return on investment if you held on. It paid off in spades. And also the difference is that Anthropic and OpenAI do not have assets. These companies don't have data centers. They're not buying data centers.

  5. 35:51

    They're leasing data centers. They're leasing chips. But that's the part that I don't quite understand. Why wouldn't they want to own their own infrastructure? How would they afford them? Or is it impossible? But then what are they? So all the money they're raising is just on leasing? It's just on agreements that they're making with other companies? Yep, that's exactly it.