Consensus projects $667 billion in capital expenditure from hyperscalers in 2026, a 62% year-over-year increase, following a 73% increase in 2025.
Amazon, Microsoft, Alphabet, Meta, and Oracle continue to accelerate infrastructure as if the cycle has no brakes.
The question is… will the return on this capital justify this pace?
That chart is staggering. $667B is more than the GDP of most countries.
The ROI question is the real kicker. If AI doesn't generate actual revenue soon, this capex cycle will hit a wall. Capital always finds reality eventually.
Curious: Where do you think that capital flows if AI disappoints? Back to hard infra, or elsewhere?
back to the "safe" areas of the economy: consumer stables, healthcare, maybe bonds.