AI’s $5trn Price Tag

AI’s $5trn Price Tag

“The question is not ‘which market will finance the artificial intelligence (AI) boom?’ Rather, the question is ‘how will financings be structured to access every capital market?’” said JPMorgan strategists led by Tarek Hamid in a report released Monday. Building out data centers will require an estimated $1.5trn in investment-grade bonds over the next five years, with the total funding required in the $5trn–7trn range, enough to singlehandedly drive a rebound in the bond and syndicated loan markets. The report comes after tech stocks recorded their worst week since April, losing close to $1trn in market value amid valuation concerns.

SoftBank Cashes in on Nvidia

The Japanese giant [SFTBY] reported a $19bn gain in its Vision Fund in Q2, thanks in part to returns on investments in OpenAI. To fund additional investments — including $22.5bn to the ChatGPT maker, of which it owns an estimated 11% — SoftBank has sold its entire stake in Nvidia [NVDA], at a value of $5.8bn. “I can’t say if we’re in an AI bubble or not,” CFO Yoshimitsu Goto said during the earnings call Tuesday, adding that the company sold NVDA shares “so that the capital can be utilized for our financing”.

Intel’s AI Chief Jumps Ship

In the latest setback for the troubled US chipmaker, Intel’s [INTC] Chief Technology and AI Officer Sachin Katti has left the company after just a year in his new role, Bloomberg reported on Monday. Katti will join OpenAI to work “on designing and building our compute infrastructure,” President Greg Brockman posted on social media. Intel’s CEO Lip-Bu Tan will take on Katti’s role, with the company announcing in a statement that “AI remains one of Intel’s highest strategic priorities”.

Rocket Lab Takes Off After Q3 Earnings

Rocket Lab [RKLB] is a commercial space company that specializes in satellite launches and payload services. It has enabled more than 1,700 flights to-date. Based out of Long Beach, California — and originally founded in New Zealand in 2006 — Rocket Lab serves clients in both the public and private sectors. RKLB stock surged in after-hours trading after Q3 earnings beat Wall Street expectations, extending a rally that has put it up over 280% in the past year. In a recent Foresight piece, OPTO examined the company’s prospects ahead of its November 10 earnings release.

EU Proposes Pause on AI Act

Following pressure from Big Tech firms and amid negotiations with the US government, the EU is considering watering down its digital rule book via a so-called “simplification package” set to be reviewed on November 19. The move reflects the bloc’s attempts to compete against the US and China in the rapidly evolving AI space. Under consideration is its AI Act, considered the world’s strictest AI legislation, set to come into effect in August 2026.

CoreWeave Revenue Surges, Guidance Disappoints

The AI infrastructure Wall Street darling [CRWV] saw its stock drop 6% on Monday following Q3 earnings, with guidance for FY 2025 revenue coming in at $5.05bn–5.15bn, below analyst estimates of $5.29bn. The dip is due to delays in data center development, CEO Mike Intrator said during the earnings call, adding that it won’t affect the company’s $55.6bn backlog. Quarterly revenue rose 134% year-over-year to $1.36bn, trouncing expectations of $1.29bn. Net loss also narrowed to $110m, compared to $360m in the year-ago quarter.

Qualcomm’s AI Acceleration

Smartphone chipmaker Qualcomm [QCOM] has been lagging behind Advanced Micro Devices [AMD] and Nvidia [NVDA] in its AI hardware — until now. At the end of October, Qualcomm announced AI accelerators designed to help deliver the computing power required to train and run large language models. According to CEO Cristiano Amon, Qualcomm’s addressable market for AI data centers is “all of it”. But can the company match its ambitious targets? OPTO examines the bull and bear case for QCOM stock, plus how it is reducing its reliance on revenues from Apple [AAPL].