The Journal. Is the AI Boom… a Bubble?
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Oct 14, 2025 
Eliot Brown, a finance reporter specializing in the economics of the AI boom, joins to discuss whether the current surge in AI investment is sustainable or merely another tech bubble. He explores the staggering costs associated with building massive data centers, like the one in Texas, and examines the financial implications of AI revenue projections. Drawing parallels to historical infrastructure bubbles, he highlights the significant risks involved, and the pressure on companies to justify their hefty investments amidst uncertain returns.
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Gigawatt Costs Scale To Hundreds Of Billions
- OpenAI and Oracle announced expansion plans that could bring OpenAI to seven gigawatts of capacity.
- OpenAI estimates each gigawatt costs about $50 billion, implying multi-hundred-billion dollar buildouts.
Big Tech's Massive AI Capital Spend
- Major tech firms (Microsoft, Amazon, Meta, Alphabet) are collectively spending nearly $400 billion on AI next year.
- This level of speculative spending is reshaping tech-sector capital allocation.
Revenue Gap Between Buildout And Reality
- Bain estimated the AI sector needs about $2 trillion in annual revenue by 2030 to justify infrastructure investment.
- Current AI revenue (2024) is tiny in comparison, around $45 billion per Morgan Stanley.