UBS forecasts AI capex tripling to $4.1 trillion from 2026-2028 as cloud giants reinvest nearly all revenue into data centers.
Hyperscalers are projected to spend $4.1 trillion on AI infrastructure between 2026 and 2028, more than triple the $1.292 trillion spent over the previous six years. The surge reflects an aggressive buildout ahead of expected demand, turning capital expenditures into a competitive arms race.
Amazon, Alphabet, and Microsoft will collectively allocate 102% of their cloud revenue to capex in 2026, effectively recycling nearly all income into data centers. The spending spree underscores a shift from incremental expansion to preemptive infrastructure investment.
UBS notes that returns will favor companies converting infrastructure into recurring revenue rather than those with the highest spending. The trend signals a long-term shift in corporate investment priorities driven by AI adoption.