Compute Won the Budget

Mark Zuckerberg told Meta employees the 8,000 layoffs starting May 20 exist because compute infrastructure costs have exploded, not because AI replaced workers. Meta’s 2026 capex guidance is now $125 to $145 billion, nearly double last year. Across Meta, Google, Amazon, and Microsoft the combined AI spend sits around $725 billion, up 77% year over year. This issue gives you the memo decoder: how to tell whether your next reorg is a productivity story or a substitution story, and what each one means for your job.