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Ben PowellChief Investment Strategist, Asia Pacific BlackRockpredicting that the current wave of capital investment in artificial intelligence (AI) infrastructure is far from its peak.
According to CNBC, Powell emphasized on the sidelines of Abu Dhabi Financial Week that artificial intelligence “picks and shovels” suppliers such as chip manufacturers, energy producers and copper wire manufacturers are the main beneficiaries of continued capital inflows.
He noted that AI-driven capital spending is accelerating and shows no signs of slowing down as major tech companies vie for dominance in what they see as a winner-take-all battle.
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Powell added that major tech companies are just beginning to tap credit markets to fund the next wave of AI growth, suggesting more capital is on the way.
“The funding is very, very clear,” he said, adding that BlackRock expects the broader capital spending boom to continue.
Powell said hyperscalers are acting as if any failure to capture the No. 1 spot would drive them out of the market, prompting a sharp increase in spending even at the risk of overshooting.
Powell said most of the capital is likely to flow to companies that support the expansion of artificial intelligence rather than the model makers themselves, echoing a growing belief among global investors that the most durable benefits from the artificial intelligence boom may come from the hardware, energy and infrastructure that support it.
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In its new global outlook released earlier this month, BlackRock noted that the U.S. economy is entering a capital-intensive regime driven by large-scale investments in artificial intelligence that can maintain growth resilience even as traditional business cycle signals cool. The company estimates that global artificial intelligence capital expenditures may reach US$5 trillion to US$8 trillion by 2030, with the United States leading this construction.
However, concerns about a potential AI bubble have long focused on whether demand can justify the industry’s explosive valuations.
Jody Visser of 22V research Says the next phase of AI investment won’t depend on who spends the most, but on who can perform within constraints. He believes that as the industry moves from capital constraints to delivery constraints, success will depend on execution, infrastructure readiness and project management. By 2026, the winners will be those companies that can convert contracts into real capacity while protecting profits amid rising costs and tight deadlines.
Amid this optimism, I/O Fund C.E.O. Beth Kindig predict NVIDIA Corporation (NASDAQ: NVDA ) valuation will reach $20 trillion by 2030. Wall Street continues to raise spending on AI infrastructure: from an initial peak of $280 billion to McKinsey’s estimate of $5.2 trillion for AI data centers. If Nvidia maintains or expands its roughly 50% market share, a potential $20 trillion could become a reality.
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This article “The money is very, very clear: BlackRock says the biggest winners from the AI revolution are hiding in plain sight — and investors are missing them” originally appeared on Benzinga.com
