Morgan Stanley: The AI investment cycle is just beginning, and by 2028 the size will be close to $30 trillion.

Morgan Stanley pointed out in the report "Mapping AI's Circularity" that artificial intelligence is in the early stages of large-scale investment, with global spending expected to reach nearly $3 trillion by 2028. The bank's global technology team believes that this wave of spending is just the beginning of multi-year AI capital expansion. The report emphasizes that super-scale cloud service providers are the main drivers of investment growth. Industry procurement commitments have already reached $330 billion, with total lease agreements of around $340 billion, demonstrating the scale and intensity of investment. Morgan Stanley analysts stated that the AI ecosystem is becoming increasingly interconnected: as leading manufacturers continue to pour in capital, collaboration and integration between hardware suppliers, software developers, and cloud platforms are deepening, creating a tight network of dependencies. Sustainability remains a focus of attention. Through bottom-up analysis, the bank's strategists estimate that with support from standard software profit margins, AI software revenue is expected to reach $1.1 trillion by 2028, indicating significant potential for capital investment returns. In conclusion, the report states that while AI spending is massive, prudent execution and revenue growth remain key to sustaining momentum.