By Samuel O’Brient
Publication Date: 2025-12-29 17:27:00
What AI bubble?
New research from Bank of America has thrown cold water on the growing narrative, and instead focuses on the upside the firm sees in chipmakers.
The firm recently laid out its forecast for the coming year in a note to clients, predicting that the AI market will experience some volatility but ultimately finish the year strong as data center buildouts continue and companies double down on manufacturing and equipment spending.
The analysts view the AI market as being roughly halfway through an eight- to 10-year evolution, for which 2026 marks the midpoint. During its second half, they expect to see tech companies continue to upgrade IT infrastructure and continue accelerating AI workloads.
BofA sees a particular opportunity in large-cap companies that are also high-quality sector leaders. It highlighted six chip stocks it says are particularly well-positioned to benefit from AI-capex spending that could reach $1.2 trillion by 2030.
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