Goldman Sachs Warns AI Capital Spending to Drag Hyperscaler ROE Down 700 Basis Points

According to Goldman Sachs on June 15, artificial intelligence capital spending will put increasing pressure on hyperscalers' return on equity in the near term. The bank highlighted that higher depreciation costs from massive AI investments will erode gains from semiconductor margin improvements. Goldman Sachs estimates the big seven tech companies' ROE will decline by an average of 700 basis points next year due to rising capital expenditures, increased depreciation, and equity issuance expansion.
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