AI capex to pass $1 trillion by 2027, says Raymond James strategist

Industry
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Summary · why it matters

Raymond James Investment Management chief market strategist Matt Orton predicts that artificial intelligence capital expenditures will exceed $1 trillion by 2027, driven by strong cloud monetization and capacity constraints. He warns that if Big Tech companies fail to raise their spending guidance, chip stocks such as Micron and Sandisk could face an additional 15% to 20% sell-off. Orton notes that management teams are citing capacity constraints as the reason for not beating numbers, and that spending a trillion dollars to capitalize on a $2 trillion backlog of cloud service agreements is money well spent.

Impact on stocks 3

Semiconductors▼ · 2 stocks
Micron Technology Inc
MU
▼ NegativeCapitalrelevance

Strategist warns Micron could face 15-20% sell-off if Big Tech fails to raise spending guidance.

Sandisk Corp
SNDK
▼ NegativeCapitalrelevance

Strategist warns Sandisk could face 15-20% sell-off if Big Tech fails to raise spending guidance.

Artificial Intelligence▲ · 1 stocks
Alphabet Inc Class C
GOOG
± MixedCapitalrelevance

Article discusses AI capex trend; Alphabet is a Big Tech company that may need to raise spending guidance, but no specific mention of Alphabet.

Theme Impact 7

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