Kevin Beaumont@GossiTheDog@cyberplace.social
There’s an eye opening article in FT quoting Morgan Stanley about the size of the generative AI bubble developing.
https://www.ft.com/content/7052c560-4f31-4f45-bed0-cbc84453b3ce
“Hyperscaler funding of $300bn to $400bn a year compares with annual capex last year for all S&P 500 companies of about $950bn.”
Paywallless: https://archive.ph/2025.07.30-135255/https://www.ft.com/content/7052c560-4f31-4f45-bed0-cbc84453b3ce
Tl;dr - if GenAI doesn’t pay off - as Morgan Stanley point out, it may not meet expectations - it will be 10 times higher than the previous bubble pop. 🥤
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BrianKrebs@briankrebs@infosec.exchange
@GossiTheDog@cyberplace.social this bit highlights the astonishing assumptions powering the AI bubble:
"The AI-capex cycle has been in motion for some time now, with hyperscaler spend alone going from ~ $125bn two years ago to ~$200bn in 2024, and expected by consensus/guidance to exceed $300bn in 2025. So far, internal cash flows from hyperscalers have been more than sufficient to match these requirements. Our equity analysts are optimistic about AI monetisation, and project that GenAI revenues could exceed $1tr by 2028, with close to 70% variable margins, compared to just $45bn in 2024."
