Transformational Innovation Opportunities Artificial Intelligence

UBS has rebalanced its AI strategy by reducing semiconductor and hardware exposure from 76% to 61% while increasing defensive allocations. The firm remains watchful of hyperscaler capital expenditure trends amid recent market volatility.

Key Takeaways

• 1.Reduced combined semiconductor and hardware exposure in the AI strategy from 76% to 61% while increasing defensive AI ecosystem exposure to 20%.
• 2.The firm is closely monitoring risks of an 'AI capex taper tantrum' as hyperscaler stocks decline, potentially pressuring future capital expenditure.

Table of Contents

• AI quick pulse: Trimming exposure to semis and hardware within our AI strategy
• Our view
• Navigating the risk of an AI capex taper tantrum
• Big tech: Right-size exposure and avoid over-concentration
• AI supply chain (semi/hardware) pecking order
• Risk table
• Appendix

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