Tech Companies to Spend $1 Trillion on AI Infrastructure by 2027

UBS projects that major technology companies will spend more than $1 trillion on artificial intelligence infrastructure by 2027. According to the report, capital expenditure is expected to surpass $600 billion in 2026 before reaching the trillion-dollar threshold the following year, driven by computing capacity demand that has exceeded supply ahead of schedule.

This investment cycle added approximately 0.75 percentage points to US GDP growth during the first half of 2026. The spending has created divergent employment trends, with data center construction employment growing by nearly 3%, while software and computer systems design employment declined by 1.4%.

While AI has not yet caused significant job displacement or materially increased overall productivity, it is increasing prices for software, digital goods, and electricity. The report warns of financing pressures and weakening cash flows, noting that investors expect free cash flow to return to positive territory in 2028, provided companies can generate sustainable revenue from AI services.