Goldman Sachs projects that Amazon, Alphabet, Microsoft, Oracle, and Meta will invest $1,2 trillion in AI infrastructure by 2027. This figure surpasses the previous Wall Street consensus of $1,1 trillion and represents a 50 percent increase over the $800 billion expected for the current year.
The growth rate of these investments is expected to decelerate over time. While the pace of spending reached nearly 100 percent in 2026, it is forecast to drop to 54 percent in 2027 and further decline to 12 percent in 2028. Analysts note that companies require approximately $300 billion in annual AI revenue to recover these capital outlays.
Cloud revenue growth reached 48 percent in the second quarter of 2026, up from 25 percent in 2024. However, current earnings remain below the levels needed to justify the infrastructure buildout. Goldman Sachs warns that spending now exceeds cash generated from operations, forcing companies to rely more heavily on debt financing.
The report highlights that the scale of this investment cycle is comparable to 19th-century railroad construction relative to GDP. Potential risks to these projections include ongoing bottlenecks in power supply, labor availability, and the production of memory chips, which could hinder the planned expansion.
