LIVE MARKETS-AI revenues to hit $975 billion by 2030, says Citigroup

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AI REVENUES TO HIT $975 BILLION BY 2030, SAYS CITIGROUP

Citigroup forecasts global AI revenues to reach $975 billion by 2030, up from $43 billion in 2025, implying an 86% compound annual growth rate.

This reflects accelerating enterprise adoption and monetization of AI technologies, with hyperscaler cloud providers ramping up infrastructure investment to meet surging demand.

Google-parent Alphabet GOOGL.O, Facebook-owner Meta META.O, Microsoft MSFT.O and Amazon AMZN.O, four of the largest U.S. tech companies, unveiled plans last week to significantly boost annual capital spending, as they ramp up investments in semiconductor infrastructure and data center capacity to support growing demand for artificial intelligence.

Citigroup estimates U.S. hyperscaler capital expenditures will total $4.4 trillion between 2026 and 2030, with global spending, including sovereigns and other entities, reaching $7.75 trillion over the same period.

However, the brokerage says operating cash flow-to-capex ratios across hyperscalers have compressed amid the investment cycle, falling from 2.9 in 2023 to an expected 1.21 in 2026, before improving in 2027.

Citi says Oracle ORCL.N is seen as the most aggressive spender relative to its free cash flow, while Amazon and Google are expected to maintain higher ratios through 2028.

The reliance on debt and alternative financing, such as Meta's joint venture with Blue Owl OWL.N to fund its biggest data center project globally, is raising investor concerns due to the scale of required funding, Citi added.

(Joel Jose)

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