Money Keeps Pouring Into AI

We got (at least) two major headlines regarding AI funding this week.

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The Stargate Project

First up, another item on Trump's busy schedule this week was the announcement of The Stargate Project.

It's a joint venture between OpenAI, Oracle, and Softbank with the intent to invest up to $500 billion in building out AI infrastructure in the US over the next four years.

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Meta doubles down on AI

Next, Meta announced plans to spend up to $65 billion on improving its AI infrastructure this year. Investors seemed to like the announcement and sent shares 1.73% higher to a new ATH on Friday after the news.

The investment will both go to hiring for key AI roles and for actual infrastructure build-out.

CEO Zuckerberg said that "this will be a defining year for AI" and that "this is a massive effort, and over the coming years it will drive our core products and business."

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The takeaway

I think the overall takeaway here is that AI is just getting started. The largest companies and funds are investing massively in building out the infrastructure and advancing the technology.

Now, with Trump at the helm in the US, the industry has full support from a regulatory side as well. And Trump wants the US to win, as he's stated multiple times in no uncertain terms.

My take is that big tech will keep winning because of this. Meta as well as Alphabet, Amazon, Microsoft, Apple, Tesla, etc. who have all been investing heavily in AI will continue to do so and be rewarded for it. Especially as they show the results of their efforts in the form of productivity gains, increased sales, and ultimately earnings. The big risk to the tech tade is that these massive investments in AI don't actually result in the expected, tangible outcomes.

The even safer bet is the AI infrastructure players who will win regardless. The picks and shovels, if you will. Nvidia is the obvious example. The stock has been consolidating for a few months and I wouldn't be surprised to see it break out to new all-time highs in the near future.

In other words, I don't see why 2025 wouldn't turn into a repeat of 2024 where the stellar stock market performance, particularly in the US, was largely driven by big tech. I'm positioned accordingly.