The tech giants leading the rush into generative AI are in rude financial health. But strong as their latest earnings performance may look, not much can be directly attributed to generative AI. Nor is it entirely clear how they will ultimately justify the massive increase in capital spending to build and deliver the technology.

After Alphabet last week, that was the message again as stellar results from Microsoft and Meta lifted tech stocks across the board on Thursday. 

At Meta, AI is certainly having an impact, bringing improvements in advertising efficiency and better personalisation of content. But this reflects an earlier investment in a different form of AI, not the generative kind. Talking to Wall Street, chief executive Mark Zuckerberg was clear that his sights are on the horizon: Meta doesn’t expect generative AI to have much impact on revenue for at least the next couple of years.