UBS: Six cloud firms need $7.7T to hit 15% returns
Business
Amazon and Microsoft have a massive challenge ahead with their AI investments.
According to UBS, the world's six largest cloud companies would need to pull in an extra $1 trillion in operating profits by 2031 just to hit a 15% return.
That means investing $7.7 trillion over the next few years, mostly into building up their AI infrastructure.
Hyperscalers face $3.4T revenue gap
To reach these goals, the six hyperscalers would have to do slightly less than twice what they earn now and find $3.4 trillion in new revenue, all while dealing with power supply constraints and shrinking returns.
UBS even compares this wave of spending to the old telecom and dot-com booms, where much of the real gains went to internet companies rather than those who built the tech behind them.