Among the many shifts in 2025, few were as striking as the speed and scale of artificial intelligence development. It was only about three years ago that OpenAI released ChatGPT to the public, yet the AI boom is already reshaping markets. While past investment waves, such as the internet boom—and eventual bust—feel similar, our market outlook shows the “AI wave” still accelerating with no signs of slowing down in the near future.
What’s Driving the AI Boom Right Now
Giant tech companies are largely driving today’s AI boom through massive AI-related capital expenditures (capex). Much of this AI spending comes from companies that provide large-scale cloud computing capacity and operate hyperscale data centers.
AI-related capital expenditures (“capex”) reached nearly $400 billion last year, up from $239 billion in 2024.1 But why the aggressive AI investment ramp-up? These companies have the cash flow, and the competitive urgency, to believe they can win the AI race. As Google cofounder Larry Page put it, he would rather go bankrupt “than lose this race.”
Why This AI Expansion Looks Different from Past Tech Cycles
Unlike past tech cycles, AI is a pricey proposition: It requires massive computers, specialized chips, lots of buildings, and massive amounts of energy, all of which cost a lot of money. As big tech companies pour funds into AI stocks, they push prices higher. Higher stock prices make it easier to raise more money, which keeps the AI spending cycle going.
Even with AI bubble warnings swirling, this particular surge doesn’t carry the usual signs of tech euphoria yet. Instead, it confronts something deeper: how AI may reshape work itself, all while consuming far more power than earlier digital revolutions.
The Economic Impact of AI in 2026
AI is much more than a passing fad, and it’s already having a significant impact on the economy through spending on AI-related software and hardware. Our 2026 outlook projects that investments could climb to roughly $515 billion.1
How to Think About Investing in the AI Boom
Wondering how to invest in the AI boom? Investors face a trade-off: There’s always the risk of a bust, but also a risk of missing out if the boom lasts longer than expected. Diversification is going to be the key to staying invested in AI without going all in. That means spreading out exposure beyond a handful of large U.S. tech stocks and looking across sectors, company sizes, and countries.
Where the AI Boom May Be Heading Next
Our 2026 outlook research points to an AI-driven infrastructure buildout that is already gaining market momentum and poised to power economic growth well beyond 2026. This includes:
- Increased reliance on debt financing, which will tie the AI boom to other market sectors like private credit lenders and real estate trusts.
- Global and sector broadening that extends beyond the U.S. into emerging markets such as China, Taiwan, and South Korea.
- Overcapacity potential, which could eventually lead to excess supply and a bust, although we don’t think the negative phase is likely for 2026 or 2027.
- Energy and utility impact, requiring significant energy resources to power data centers, raising electricity bills, and creating demand for energy infrastructure.
Explore the 2026 Market Outlook
Stay ahead of the 2026 global investment landscape and discover how to navigate the opportunities—and any potential risks—on the horizon. Download the full Carson Market Investment Market Outlook 2026 report.
1 Market Outlook 2026, Carson Market Investment, 8 January 2026.
The opinions contained in this complimentary download are provided entirely on behalf of CWM, LLC and is in no way related to Cetera Wealth Services LLC, or its registered representatives. This information is from sources believed to be reliable, but Cetera Wealth Services LLC cannot guarantee or represent that it is accurate or complete.
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