About

Two ratios for the hyperscaler capital spending (capex) basket, each summed over the trailing four quarters: Debt / Capex and free cash flow (FCF) / Capex. FCF is operating cash flow minus capex, and Debt / Capex is new long-term debt over capex. The dotted red line is the 0.30 Debt / Capex gate the AI Credit Regime card uses, so both cards read the same number.

Instructions

Read the badge for the state and the two lines for the numbers. Compare rising and falling with four quarters earlier. Treat a change under 0.05 as flat.

Signals

• Cash financed - FCF is positive and not falling, debt is not rising, and Debt / Capex is below 0.30. The AI Credit Regime card also reads Cash financed.
• Debt financed - FCF is positive and holding, but Debt / Capex is at or above 0.30. The AI Credit Regime card also reads Debt financed or Alert.
• Worsening - FCF is positive but falling, or debt is rising.
• FCF negative - Operating cash flow no longer covers capex.

Symbols

• AMZN, GOOGL, META, MSFT, ORCL - the hyperscaler basket, from SEC filings. Supplies quarterly capital spending (capex), operating cash flow, and new long-term debt. Free cash flow is operating cash flow minus capex.