UBS Predicts Global AI Capital Expenditure Will Reach $998 Billion by 2026, with Memory Price Increases Contributing 90% of Growth

UBS's latest estimates show that global AI capital expenditure will reach $998 billion in 2026, nearly doubling from $506 billion in 2025, and further rising to $1.447 trillion in 2027. This significant upward revision is primarily driven by the rapid increase in memory prices rather than an overall expansion in infrastructure investment. Memory spending is expected to surge from $71 billion in 2025 to $367 billion in 2026, and further expand to $923 billion in 2027; meanwhile, non-memory AI capital expenditure is projected to be around $631 billion in 2026 but will drop to $525 billion in 2027. The share of memory in AI capital expenditure will rise from approximately 14% in 2025 to 37% in 2026, and further jump to 64% in 2027. UBS estimates that about 60% of the year-on-year increase in AI capital expenditure in 2026 will come from rising memory costs, with the increase in memory spending even exceeding the overall net increase in AI capital expenditure in 2027. Of the nearly $1 trillion increase from 2025 to 2027, about 90% will come from rising memory spending. UBS points out that if the incremental spending is primarily driven by price increases, the impact on the actual GDP of the United States will be quite limited, reflecting more of a transfer of income and profits to Asian memory manufacturers, benefiting the GDP of related economies. Major global memory producers are concentrated in Asia, and as the AI investment cycle deepens, the benefits to the Asian memory supply chain may exceed market expectations. This structural shift indicates that the economic driving force of the AI investment cycle is shifting from the expansion of infrastructure scale to the rising costs of key components, prompting investors to adjust their tracking framework for AI capital expenditure.

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