AI Ecosystem Charting Recent Trends

This report examines the unprecedented capital intensity of the AI ecosystem, noting that hyperscalers are exceeding historical dot-com spending records. Increasing reliance on off-balance sheet lease commitments and rising depreciation expenses pose potential margin risks.

Key Takeaways

• 1.Hyperscalers' capital intensity is forecast to reach 36%, 44%, and 42% in 2026–28, surpassing the 32% peak of the dot-com era.
• 2.AI-related spending is expected to exceed 50% of R1000 capex in 2026, with hyperscalers accounting for approximately 90% of that investment.
• 3.Remaining Performance Obligations (RPO) for major AI compute players have nearly tripled to over $2 trillion as contracts lengthen.

Table of Contents

• AI Ecosystem: Charting Recent Trends
• Key Takeaways
• Capital Intensity
• AI Boom Poised to Overtake Dot-Com Peak Levels
• Hyperscalers Capex Spending Trajectory
• Capex Revisions Climb Higher
• Lease & Purchase Commitments
• Depreciation
• Remaining Performance Obligations (RPO)
• Disclosure Section