Welcome to another episode of In Focus, where we explore timely and thematic topics with insights from across J.P. Morgan Global Research. In today&#x27;s episode, we bring together equity and credit views to examine the AI CapEx theme, which has been a major driver of risk assets. Speakers: Bhupinder Singh, US Equity Strategist &amp; Head of Thematic Research Nathaniel Rosenbaum, Head of US High Grade Credit Strategy Samantha Azzarello, Head of Content Strategy This podcast was recorded on May 1, 2026. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-5252024-0, https://www.jpmm.com/research/content/GPS-5259231-0, and https://www.jpmm.com/research/content/GPS-5271383-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2026 JPMorgan Chase &amp; Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party.

In Focus: Equity & Credit Update on AI CapEx

At Any Rate

# Full Transcript

**Podcast:** At Any Rate

## Transcript

Welcome to another episode of In Focus, where we explore timely and thematic topics with insights from across J.P. Morgan Global Research. My name is Sam Mazzarello and I lead Content Strategy. And in today's episode, we bring together equity and credit views to examine the AI CapEx theme, which has been a major driver of risk assets.

Today's discussion is with Bupinder Singh, U.S. Equity Strategist and Head of Thematic Research, and Nathaniel Rosenbaum, Head of U.S. High Grade Credit Strategy. Thank you both for joining. Thank you Samantha for having us. Thank you. Pleasure to be here. Bupinder, let's begin with you. We are near the end of MAG7 earnings this season. Could you expand on your views around tech, CapEx, and where we go from here?

So Samantha, CapEx has been the core theme for S&P 500 for more or less the last two years. Okay? For the last two years, we've been leading up to this event that these companies, these hyperscalers, were going to spend a very large amount of money. CapEx is expected to grow somewhere between 60 to 70% this year.

Okay? After ChatGPT, a year after, these 30 companies, S&P 500 companies, tied to AI, they were spending roughly around $575 billion on CapEx plus R&D. That number will grow to somewhere between $1.3 to $1.4 trillion over the next one year. So you're seeing a rapid expansion in CapEx spending over the next year.

And that is driving not only economic momentum, but also earnings momentum. So if you look at S&P 500 earnings today, estimates have been revised higher from 15% to 22% this year. You get 22% earnings growth for S&P. And if you dissect that number a little further, you have AI companies that are expected to deliver somewhere between 30 to 35% earnings growth this year,

compared to non-AI companies, which is roughly around 450 companies in S&P, which are going to deliver somewhere close to 10 to 12%. Even that number is very respectful, right? So you're having not only CapEx spend, but also the other 450 companies also delivering above trend growth rate this year.

Just to put some of these numbers into perspective. So if you look at CapEx, right? After ChatGPT, tech companies were spending roughly around $550 to $600 billion on R&D and CapEx. Over the next year, that will go to $1.4 trillion. And that's only public companies. It does not include private companies like OpenAI. It does not include non-US companies. It does not include government spending.

So if you actually include all of this together, this number is probably over $2 trillion right now. And that will probably grow to around high to $2.5 to $3 trillion over the next year after that. So you're getting to a number that's pretty much in line with global military spend. Just think about that. Three years ago, four years ago, we were at zero.

And over the next two years, we're going to probably get to a point where these tech companies are spending on data center e...

In Focus: Equity & Credit Update on AI CapEx

Transcript

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In Focus: Equity & Credit Update on AI CapEx

Transcript

Built for investment professionals

Every day you wait, your competitors are findingedge in conversations you're not hearing.

Every day you wait, your competitors are finding
edge in conversations you're not hearing.