“Is this 2000? Are we in a bubble? No,” Subramanian said during BofA’s outlook call on Tuesday. “Will AI continue unfettered in leadership? Also, no.”
Subramanian unpacked her thoughts in a recent note on the future of AI, which she sees as somewhere between fully reliable and an all-out bubble burst, where capital spending is still greater than revenue growth. “On AI, in our view, investors should get ready for an air pocket,” Subramanian wrote. “Monetization is to be determined, and power is the bottleneck and will take a while to build out. So for now, investors are buying the dream.”
“We don’t think the bubble framing is that useful at this stage for investors,” Boivin said. “There is so much talk about the potential of the bubble … People are conscious of the risk. It’s when there’s no discussion of that that we should be more worried.”
However, “capex funded by operating cash flow is running out,” Subramanian noted, with hyperscalers increasingly funding operations through debt. She noted the supply of AI infrastructure has increased by more than 1,000% from 2024 to 2025.
