Overview
- Goldman Sachs compares the current AI cycle to 1997–98’s buildout phase and says the investment boom has room to continue, though returns are not assured.
- The Age reports the largest tech firms will spend about $375 billion on AI infrastructure this year and closer to $450 billion next year as data‑centre and chip purchases accelerate.
- Funding is shifting toward external borrowing, with examples including bond issuance, special‑purpose vehicles and data‑centre securitisations, and even giants like Alphabet, Meta and Oracle tapping debt markets.
- The Bank of England has highlighted financial‑stability risks if AI asset prices fall, citing uncertain monetisation, power and chip bottlenecks, and the short life cycles of key hardware.
- OpenAI is reported to have roughly $1.4 trillion in future chip and compute commitments against a revenue run rate near $20 billion, fueling questions about funding durability and potential overcapacity.