UBS Defends AI Investment Cycle After Gartner Sparks Severe Sell-Off in Neocloud Equities

UBS stated that a recent sell-off in specialist AI neocloud providers does not derail the broader AI investment boom, viewing the downturn as an isolated funding issue rather than slowing demand. The bank projects global AI capital expenditures will rise 33% to $1.2 trillion by 2027, noting neoclouds account for under 10% of total spending. The commentary follows a tech rout triggered by Gartner's warning that over $3.5 trillion in planned AI infrastructure could face impairment by 2030, which drove down shares of firms like Nebius and CoreWeave by 25% and contributed to a 4.5% weekly drop in the Nasdaq.