AI capex surge, bottlenecks, and the race for ROI

Investing analysts Amrita Roy and Uttam Dey examine the rapidly evolving AI supply chain, emphasizing the shift from general growth strategies to thematic, bottleneck-focused investing. Capital expenditure by major hyperscalers—projected at $680 billion for 2026—serves as the primary demand driver, though the market now demands clear evidence of ROI and revenue acceleration. Key investment themes include optical networking and high-bandwidth memory, which are essential for scaling massive GPU clusters. While software and cybersecurity sectors face current de-rating and volatility, full-stack solutions like CrowdStrike remain undervalued opportunities. Investors must navigate a "higher for longer" macro environment by prioritizing companies that demonstrate both top-line growth and gross margin expansion, while remaining cautious of the timing mismatch between massive infrastructure investments and realized revenue gains.