Data Center funding and massive capex isn't for profitability, it's politics.

Bear with me here, this isn't yet another dump on Trump type post, although the buck certainly should stop with him.

Why would big tech spend so much on data centers and invest hundreds of billions in projects that still won't take it close to profitability or even sustainability?

Aside from the fact that they probably simply don't know what else to do as the world of software becomes commoditized and the platforms they own already have maxed out rent to their peon tenants, it's likely a political tradeoff meant to maintain their feudal powers.

All political systems operate on one basic principle, power is gained by the blessing of the most powerful groups. And power is held by distributing the gains under control back to those groups. I.e. if the CEO stops producing dividends or growth the board finds a new CEO.

We've seen how cozy big tech is to US govt authority and the equation is simple, given that the fastest route out of office is a sinking economy, and the US economy would already be clearly in recession without the AI capex, then the best way to stay in office is to make a deal with tech and promise either lighter regulation, a protection of their business or some other future gains in exchange for investment now. I.e. if AI busts and those data centers become monuments of folly, the govt and we the people will be required to bail them out.

The only real problem in this equation (for them) is that 1) the people eventually tire of the oppression and take matters into their hands. Especially when they get hungry 2) pride comes before the fall, or rather the famine...if you want to produce hungry and angry serfs simply keep making bad choices that undermine the local ecology and economy.