17 SEPTEMBER 2026
The chart below captures annual spending on the specialised machinery and equipment used to manufacture semiconductors.
The parabolic rise of recent years speaks for itself.
Total billings have risen from around U$30bn a decade ago to more than U$130bn today, reflecting the enormous investment required to build AI data centres and expand semiconductor production capacity.
This suggests the euphoric AI narrative is being supported by genuine spending rather than speculation alone.
Unlike the TMT boom of the late 1990s, when share prices often raced ahead of revenues and earnings, today’s AI leaders are benefiting from a surge in orders.
Valuations remain demanding, but the strength of underlying demand helps justify at least some of the extraordinary share price performance seen across the sector.
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