Cheaper AI models reshape enterprise spending but won't derail hardware demand, UBS says

Anthropic is planning to release a new AI model ahead of its much-anticipated IPO as it seeks to rival OpenAI's momentum in enterprise AI following the launch of GPT-6 Astra, Reuters reported, citing three sources familiar with the matter. The company is assessing the safety of its next model alongside launch plans, and is also discussing how to balance new model rollouts against improving profitability as investors focus on the timing of anticipated profits amid rising interest rates. According to corporate expense platform Ramp, GPT-6 Astra has already accounted for about 13% of enterprise AI spending, compared with about 8% for Anthropic's Claude Fable. Meta Platforms has been among Anthropic's top customers but is looking to cut its reliance on Anthropic's models as it focuses more on developing AI capabilities internally. Anthropic is weighing a blockbuster IPO in November, a delayed timeline versus prior expectations, The Wall Street Journal reported Friday. Anthropic did not respond to Reuters' requests for comment.

The top five US hyperscalers are projecting a combined capital expenditure of $660 billion to $725 billion for 2026, nearly double their 2025 outlays, as the AI build-out shifts from software to physical infrastructure. Microsoft is guiding for roughly $175 billion in adjusted capital expenditure for both FY2026 and FY2027, with two-thirds of quarterly spend going to short-lived assets like CPUs and GPUs and the rest to long-lived data center infrastructure, and it added 1 gigawatt of capacity in Q3 FY2026, doubling its global footprint in two years. Amazon AWS has raised its 2026 capex guidance to approximately $220 billion, with CEO Andy Jassy saying AI capacity is expected to remain constrained through 2027 and contracted demand extending into 2028. Meta saw profit drop 14% in Q2 2026 despite a 28% revenue increase as its build-out, including a 1 gigawatt data center in Ohio and a Louisiana facility that could scale to 5 gigawatts, compressed margins, while Alphabet raised its 2026 capex guidance to as much as $205 billion and its Google Cloud backlog more than doubled year-over-year to $240 billion. The Stargate joint venture involving Oracle, OpenAI and others targets up to $500 billion in infrastructure investment by 2029, and Oracle's FY2026 capex reached $55.7 billion, more than doubling from the previous year.