Tech Giants Pour Billions: Is AI Investment ROI Actually Viable?

Morgan Stanley estimates that the capital return rates across different AI business models are all attractive: providing API services with proprietary computing power can reach up to 46%, cloud vendors renting out GPUs yield about 31%, and even relying on third-party computing power offers around 25%. Meanwhile, capital expenditures by the four major cloud vendors are projected to rise to $1.47 trillion by 2027, with growth slowing to about 12% by 2028. AI investment is shifting from "competing on computing power" to "competing on commercialization."