The underlying reason for the recent sell-off in US stocks is market concerns that AI capital expenditure growth may have peaked. Amazon, Google, Meta, Microsoft, and Oracle are expected to slow their capital expenditure growth over the next two years, with the 2028 growth forecast dropping from 18% to 9% in the past two months. AI investment, which had accelerated for several years, is now facing uncertainty about a growth inflection point.
This change may spread along the industry chain: reduced new investments by cloud vendors will directly impact the revenue and profit expectations of chip suppliers like Nvidia, as well as data center construction and power equipment companies. Meanwhile, except for Microsoft, the cash flow of other major cloud vendors has been squeezed by AI construction spending, and some companies have begun to raise funds through stock and bond issuances. Rising US interest rates and stricter data center approvals after the midterm elections have further increased investment uncertainty. Goldman Sachs estimates that potential state and local construction halts could affect 45% of planned data center capacity in the US.
