Goldman Sachs: AI Infrastructure to Drive S&P 500 Earnings Growth
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5 days ago
0mins
Source: seekingalpha
- AI Infrastructure Investment Outlook: Goldman Sachs analysis projects that AI infrastructure spending will become the dominant force behind S&P 500 earnings growth over the next two years, with beneficiaries of AI investment expected to account for roughly half of S&P 500 EPS growth in both 2026 and 2027, highlighting the significant impact of technology buildout on corporate America's profitability.
- Semiconductor Sector Gains: Consensus estimates indicate that Nvidia and Micron Technology will together account for a third of S&P 500 EPS growth in 2023, positioning chipmakers as the primary direct beneficiaries of surging AI investment, thereby solidifying their critical role in the market.
- Broad Industry Impact: Beyond semiconductors, tech hardware manufacturers, industrial companies, and utilities are also experiencing substantial earnings boosts due to the proliferation of data centers and surging power demands, reflecting the positive influence of AI infrastructure development across multiple sectors.
- Depreciation Expense Concerns: Despite the optimistic overall earnings outlook, Goldman Sachs notes that growing depreciation expenses from hyperscalers will partially offset the broader earnings boost to the S&P 500, with this drag expected to have a larger impact in 2027 than in 2026, cautioning investors about potential profitability risks.
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Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise
41 Analyst Rating
39 Buy
1 Hold
1 Sell
Strong Buy
Current: 211.140
Low
200.00
Averages
264.97
High
352.00
Current: 211.140
Low
200.00
Averages
264.97
High
352.00
About NVDA
NVIDIA Corporation is an artificial intelligence (AI) infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. Its segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing and networking platforms and AI solutions and software, and automotive platforms and autonomous and electric vehicle solutions, including software. The Graphics segment includes GeForce GPUs for gaming and personal computers (PCs), and Quadro/NVIDIA RTX GPUs for enterprise workstation graphics. Its technology stack includes the foundational NVIDIA CUDA development platform that runs on all NVIDIA GPUs, as well as hundreds of domain-specific software libraries, frameworks, algorithms, software development kits (SDKs), and application programming interfaces (APIs). Its platforms address four markets, which include Data Center, Gaming, Professional Visualization, and Automotive.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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