Google and Meta cut IT vendor deals to fund AI
Business
Google and Meta are cutting back on their IT service deals so they can pour more money into building AI tech.
Google dropped its annual contract with HCLTech by nearly $50 million, affecting app development and engineering.
Meta cut its deal with Wipro by up to $20 million and tweaked agreements with other big vendors like Accenture, Teleperformance, and Concentrix.
AI spending strains Meta, Alphabet
This isn't just about saving cash: that's a sign that Big Tech is shifting priorities toward AI.
Both companies are feeling the squeeze from huge investments: Meta's free cash flow plummeted in the second quarter of 2026 thanks to AI spending, while Alphabet (Google's parent) spent nearly $45 billion in the second quarter of 2026, mostly on servers and data centers.