Four Tech Giants to Spend $625 Billion on AI Infrastructure
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2h ago
0mins
Should l Buy MSFT?
Source: Fool
- Massive Investment Plans: The four tech giants are projected to collectively spend $625 billion on new data centers and AI infrastructure by 2026, with Alphabet at $185 billion, Amazon at $200 billion, Meta at $135 billion, and Microsoft at $105 billion, indicating fierce competition in the AI market.
- Market Reaction: Despite the large investment figures, analysts are skeptical about the positive impact on profits, as evidenced by Microsoft's stock plummeting 11% in a single day last week, reflecting concerns over slowing growth in its cloud computing segment.
- Investor Opportunities: The Global X Data Center and Digital Infrastructure ETF (DTCR) is seen as a great way for investors to capitalize on the rapidly growing AI spending trend, currently managing $1.1 billion in assets and yielding a 13.3% return in 2026.
- Optimistic Market Outlook: Grand View Research estimates that the data center construction market will grow from $241 billion in 2024 to $456 billion by 2030, with a compound annual growth rate of 11.8%, highlighting the accelerating trend in AI infrastructure development.
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Analyst Views on MSFT
Wall Street analysts forecast MSFT stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for MSFT is 631.36 USD with a low forecast of 500.00 USD and a high forecast of 678.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
34 Analyst Rating
32 Buy
2 Hold
0 Sell
Strong Buy
Current: 401.140
Low
500.00
Averages
631.36
High
678.00
Current: 401.140
Low
500.00
Averages
631.36
High
678.00
About MSFT
Microsoft Corporation is a technology company that develops and supports software, services, devices, and solutions. Its Productivity and Business Processes segment consists of products and services in its portfolio of productivity, communication, and information services, spanning a variety of devices and platforms. It comprises Microsoft 365 Commercial products and cloud services; Microsoft 365 Consumer products and cloud services; LinkedIn, and Dynamics products and cloud services. The Intelligent Cloud segment consists of its public, private, and hybrid server products and cloud services. It comprises server products and cloud services, including Azure, and enterprise and partner services, including Enterprise Support Services. Its More Personal Computing segment primarily comprises Windows and Devices, including Windows OEM licensing; Gaming, including Xbox hardware and Xbox content; Search and news advertising, comprising Bing and Copilot, Microsoft News, and Microsoft Edge.
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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