AI Exposure Remains Key Amid Strong Growth Outlook

UBS maintains a strong conviction in Artificial Intelligence as a primary equity driver, despite market volatility. The report highlights accelerating cloud growth and the potential for positive catalysts from the Trump-Xi summit in Beijing.

Key Takeaways

• 1.Investment conviction in AI remains high despite short-term volatility, driven by both enterprise demand and emerging consumer agentic AI applications.
• 2.Cloud provider monetization is robust, with growth accelerating to 40% YoY in 1Q26, which helps justify high levels of capital expenditure.
• 3.Supply bottlenecks are expanding beyond memory into CPUs and other components, indicating a broader and sustained AI infrastructure cycle.

Table of Contents

• From the studio
• Thought of the day
• Robust monetization has eased some concerns over higher capex.
• Caught our attention
• Market update
• Global asset class preferences definitions
• Appendix

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