AI chipmakers face investor pressure as big tech spending cools
AI chipmakers are feeling the heat as big players like Amazon, Microsoft, Alphabet, and Meta slow down their spending.
After a huge jump, UBS says their investments will cool off sharply over the next few years.
That's making some investors rethink how much they put into chip stocks, worried about whether these companies can keep up their profits long term.
Fund managers favor hyperscalers and software
With chip stocks looking pricey, fund managers are now leaning more toward hyperscalers, software firms, and even sectors like healthcare and finance that could benefit from AI.
Experts like Alexis Bossard warn about overvalued chips, while Alberto Conca is playing it safe with put options and backing hyperscalers instead.
Meanwhile, hyperscalers themselves are facing hurdles like less demand for bonds and new regulations (like New York's pause on data center construction).
Still, chip-focused funds have pulled in a record $10 billion through May 2026, showing that investor confidence in AI is holding strong.