By coinnews 
00:00 Speaker A
you actually say the AI infrastructure trade is not over. How should investors be looking at this space right now?
00:07 Speaker B
Yeah, thanks for the question. So, um, we think that there’s a the AI adoption and the infrastructure that will be deployed, um, to enable it, that tailwind will persist. And so there are a group of companies, um, that are publicly traded that are likely to benefit from this. And the reason that we have this conviction is first, just if you listen to the first quarter earnings reports, um, from the hyperscale companies. So they all told us that they were either going to maintain their capital expenditure for the year or increase it. So we know that they’re investing. And then the second thing that we see is when we look at the private funding markets. Here, um, there are companies that are privately held that are building, um, large language models. You know, probably an example would be open AI. They continue to raise funds at increasing valuations. We know those funds will be deployed. And also, um, there are private, uh, funds being raised, um, both by private equity firms as well as sovereigns. And here, the investments are going to go into data centers as well as the electric power generation that will be needed to power those centers. And so with all of that money flowing, we think the trade will persist.
00:57 Speaker A
And so with that in mind, who are the biggest and best positioned winners as a result of the continuation of that AI infrastructure trade?
01:04 Speaker B
Well, the way that I would look at it, I would think about the magnificent 7 and then the other companies. Okay. And so let me first talk about the mag 7. So here, they certainly benefit from um, the persistence of the AI tailwind. And so that would be a positive. But really our view on this cohort is more mixed. And the reason for that is they face sort of unique risks that we don’t see elsewhere. So the biggest one being, um, antitrust scrutiny by the administration, and there are a number of trials that are ongoing, and we think more will come. And then, um, you know, in addition to that, many of them are vulnerable to trade disruption. We know that, you know, AI is something that for national security reasons, it’s going to limit the ability of these US domicile companies to be able to sell into China to the way that they might otherwise. And so that’s another factor that could be, you know, a headwind there. And so we think maybe it’s better to think elsewhere and look at companies. I referenced already the idea of providing electric power or the other equipment that goes into the data centers, and we think these might be better ways to play it.