Wolfe Research warns: Investors may overestimate the growth prospects of AI investments

GateUser-6433627c · 2026-02-24T16:26:58+00:00

Wolfe Research warns investors that the potential growth of AI investments may be overestimated, leading to increased market volatility. Analysts point out that although cloud providers' capital expenditures exceeded expectations, the sustainability of this trend into 2026 remains uncertain, which could impact the stock prices of related industries.

GateUser-6433627c

2026-02-24 16:26:58

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On February 25, Wolfe Research warned that investors may be overestimating the growth prospects of AI investments, even as the market remains volatile. Recent trading shows that headlines alone can drive declines of about 1%–1.6% in the S&P 500, Nasdaq 100, and Russell 2000 indices. Wolfe Research analyst Chris Senyek noted that although hyperscale cloud providers are expected to exceed their capital expenditures in 2025, it remains uncertain whether they can sustain this pace into 2026. Bottlenecks in power, raw materials, and regulation could slow down large-scale AI infrastructure development in the second half of 2026. If spending growth slows, it could benefit industries previously pressured by AI concerns, but it would also significantly impact stocks heavily reliant on AI investments, such as semiconductors and industrials.

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