Useful-life policy
short lives ~5-6 yr
extended useful lives
Capex pace
stays hot
trimmed if demand softens
AI capex converts into either future profit or near-term FCF and depreciation drag
operating cash flow
the cash engine
capital spending
cash out · not expensed
immediate
capitalize
free cash flow
flashpoint now · drains today
cash exits today · spent now
capitalized assets — PP&E
servers / accelerators
~5-6 yr
data centers / buildings
25-40 yr
backlog
depreciation lag
run-off ≈ ⅓ of capex
the 2025-26 cohort
2027-29 cliff
2023
2024
2025
2026
2027
2028
2029
short accelerator lives
cliff lands ~2027
extended useful lives
drag deferred → 2029+
revenue offset
cloud/AI growth vs capex
the 2027-29 wall is a projection · capex bases differ
EPS carries one-time items · timing is policy-driven