Big Tech’s $650B AI Push in 2026
- Major U.S. technology companies are expected to invest around $650 billion in AI‑related infrastructure in 2026.
- The projection comes from Bridgewater Associates, which warns that the rapid acceleration of spending marks a more precarious phase of the AI boom.
- Rising capital demands, potential market risks and broader economic effects all shape the outlook for the coming year.
AI Infrastructure Spending Accelerates Sharply
Alphabet, Amazon, Meta and Microsoft are projected to collectively spend about $650 billion on AI infrastructure in 2026. This represents a significant jump from the estimated $410 billion invested in 2025. Bridgewater co‑chief investment officer Greg Jensen described the trend as evidence that the AI boom has entered a more dangerous stage. He noted that compute demand continues to exceed supply, pushing hyperscalers to expand even faster.
The companies have already reduced share buybacks to help fund their rising capital expenditures. Jensen warned that the scale of spending introduces substantial downside risks if growth expectations falter. Heavy reliance on external capital could amplify vulnerabilities across the sector. These concerns reflect broader questions about the sustainability of current AI investment levels.
Pressure on AI Startups and Adjacent Sectors
Jensen highlighted that leading AI developers such as Anthropic and OpenAI will require major product breakthroughs to secure the final rounds of funding needed before potential IPOs. Without clear paths to outsized profits, he said these firms may struggle to justify their valuations and capital needs. The rapid pace of AI development is also creating challenges for software companies and data providers. Recent selloffs in software stocks illustrate how investor expectations are shifting.
According to Jensen, AI leaders can no longer meet investor demands without creating existential risks for other sectors. The competitive pressure generated by advanced AI tools is reshaping business models across the technology landscape. Companies that rely heavily on proprietary data or traditional software licensing may face increasing uncertainty. These dynamics underscore the disruptive nature of the current AI cycle.
Economic Impact and Potential Market Risks
Bridgewater estimates that technology investment contributed roughly 50 basis points to U.S. GDP growth in 2025. The firm expects that figure to rise to around 100 basis points in 2026 as AI‑related spending accelerates. Increased demand for hardware and data‑center capacity may also push up prices for technology equipment and electricity in certain regions. These pressures could influence inflation trends in the broader economy.
Jensen cautioned that a severe stock market correction could undermine growth and restrict companies’ ability to raise capital. He compared the situation to the Dot‑com bubble, though he emphasized that current conditions remain far smaller in scale. Even so, the combination of high expectations and massive investment commitments introduces notable risks. The coming year may test whether the AI sector can sustain its rapid expansion.
The projected $650 billion investment figure is larger than the annual GDP of many countries, highlighting the unprecedented scale of the AI build‑out. Much of this spending is expected to go toward data centers, semiconductor supply chains and energy infrastructure, all of which face capacity constraints. Analysts note that the global race for AI dominance is increasingly tied to physical resources rather than software alone. This shift marks a new phase in the technology industry, where compute power and energy availability may become as strategically important as algorithms themselves.
