The big wrinkle in the multitrillion-dollar AI buildout
California could soon be running short of gasoline, potentially hiking some of the highest gas prices in the country.
Industry watchers have started to wonder whether tech companies will see AI returns quickly enough to keep up with how often they must upgrade to the latest chips to power their data centers.
Noah Berger/Reuters for AWS
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ALEXEY
New York — There’s a giant question hanging over the tech industry: How long will its massive investments in AI infrastructure really last?
Tech giants are shelling out hundreds of billions of dollars on artificial intelligence infrastructure — mainly, data centers and the chips that power them. It’s an investment they say will set the stage for AI to overhaul our economy, our jobs and even our personal relationships.
This year alone, tech firms are expected to pour $400 billion into AI-related capital expenditures.
A portion of that will almost certainly put a recurring strain on companies’ balance sheets. And for companies hinging their future on AI, the question of how frequently they’ll have to upgrade or replace advanced chips is a critical one — especially since there’s growing skepticism of whether AI will produce returns large or quickly enough to recoup both existing investments and cover future infrastructure costs.