Jefferies: The AI Frenzy Crazy CapEx Forecast: The four major U.S. cloud giants (Google, Amazon, Meta, Microsoft) are expected to spend around $700 billion in capital expenditures this year, with projections exceeding $800 billion next year. Impact on the Macro Economy: Including Oracle, Anthropic, OpenAI, and emerging cloud providers, total capital expenditures next year are expected to surpass $1 trillion—equivalent to about 3% of U.S. GDP and 33% of the total pre-tax profits of all non-financial enterprises in the U.S. Cash Flow Crunch: This aggressive spending spree is rapidly eating into cash flow; the proportion of capital expenditures to operating cash flow for the four cloud giants is expected to soar from 41% in 2023 to 92% by 2026. Debt Issuance: According to Bloomberg data, the four major U.S. cloud giants have issued $144 billion in bonds so far this year, compared to just $83 billion for the entirety of 2025. In the first half of 2026, Google, Amazon, and Meta are expected to issue $52 billion, $67 billion, and $25 billion in bonds, respectively, while Microsoft has yet to issue any. Additionally, Oracle has issued $25 billion in bonds so far this year. Highly Concentrated Memory Market: There are now only three major global DRAM suppliers (down from 12 in 2012), collectively holding about 89% of the market share. AI Propping Up U.S. GDP: The U.S. economy has become heavily reliant on this wave of AI. AI-related capital expenditures alone contributed 1.13 percentage points (42%) to the 2.68% year-over-year growth in U.S. real GDP for Q1 2026. #AI #CloudComputing #Economy #TechTrends