Amazon, Meta, and Alphabet report plunging tax bills thanks to AI investment and new rules in Washington

Core Viewpoint - The combination of the expansion of artificial intelligence data centers and favorable tax provisions from recent legislation is expected to result in significantly lower tax bills for major tech companies in 2025, enhancing their profitability [1][2]. Tax Bill Reductions - Amazon's tax bill is projected to decrease from approximately $9 billion in 2024 to $1.2 billion in 2025 [3]. - Meta Platforms anticipates a reduction in its tax bill from about $9.6 billion in 2024 to $2.8 billion in 2025 [3]. - Alphabet's combined federal and state tax obligations are expected to drop from around $21.1 billion in 2024 to $13.8 billion in 2025 [3]. Profit Increases - Amazon's domestic profits are expected to rise to nearly $90 billion in 2025, reflecting an over 40% increase from 2024 [4]. - Alphabet's domestic profits are projected to increase by over 32% to $143.6 billion [4]. - Meta's profits are anticipated to reach $79.6 billion, marking a 20% increase [4]. Investment and Tax Strategy - Amazon reported investments exceeding $340 billion in the US last year, including significant allocations towards AI innovation [8]. - Meta's CFO indicated that the company is experiencing substantial cash tax savings due to the new US tax laws, which are beneficial given their investments in infrastructure and R&D [8].