Tech giants' AI spending to hit $1T in 2027

A comprehensive report released by UBS on October 21, 2026, projects a dramatic acceleration in artificial intelligence infrastructure investment over the next two years. Investment by major technology companies in artificial intelligence infrastructure is expected to exceed USD 1 trillion in 2027 as demand for computing capacity continues to outstrip supply, supporting US economic growth despite rising financing needs.

AI-related capital expenditure by major technology companies will exceed USD 600 billion in 2026 before crossing USD 1 trillion in 2027. This represents a staggering year-over-year increase driven by sustained demand for computing resources. Demand has exceeded capacity ahead of schedule, with companies raising their investment plans as demand for computing power continues to grow.

Memory spending is projected to skyrocket from $71 billion in 2025 to $923 billion in 2027, with its share of total AI capex jumping from 14% to 64%, representing approximately 90% of incremental spending between 2025 and 2027. This shift reveals a fundamental restructuring of AI infrastructure priorities, with memory components becoming the dominant cost driver.

AI investments have helped US GDP grow by about 0.75 percentage points in early 2026, though tech jobs dipped by 1.4% while construction roles building data centers grew nearly 3%. While the massive capital deployment is expected to deliver long-term productivity gains and economic benefits, AI demand is currently contributing to higher prices in some areas, including software, digital goods and electricity.