Goldman Sachs predicts sustained AI-related capital spending through 2027

Goldman Sachs Research expects the imbalance between AI supply and demand to persist until the first half of 2028, leading to continued high capital expenditures and constrained supply chains. Eric Sheridan, business unit leader of the TMT Group, said the ongoing need for memory, chips and data-center land will keep input costs elevated.

Alphabet reported second-quarter capital spending of $44.9 billion, slightly above analysts’ expectations, and raised its full-year capex outlook to $195-$205 billion, with a notable increase projected for 2027. Tesla announced a $25 billion capex plan for 2026, roughly three times its historical level, and expects further growth in 2027 as it expands Optimus and robotaxi production. SpaceX’s second-quarter spending reached $18.4 billion, far exceeding the $6 billion analysts had estimated, and executives indicated that quarterly spending could remain near that level for the rest of the year, suggesting a full-year total around $65 billion.

Goldman’s analysis notes a shift in investor focus from the sheer amount of spending to the visibility of returns on that spending. Sheridan highlighted that companies such as Microsoft and Amazon have clarified how they assess return on invested capital, a trend he believes will drive higher valuation multiples as the discussion moves toward return visibility rather than absolute spending levels.