AI investment trends have shifted! The market now demands less "pie in the sky" and more "monetization".

The "create success first, then achieve success" model is facing investor skepticism in the field of artificial intelligence. Despite Nvidia's latest financial report exceeding market expectations, the stock price fell on the same day, with the largest volatility since April. In addition, Nvidia and Microsoft announced on November 18th that they will invest $15 billion in Anthropic, with the latter committing to purchase $30 billion in computing power from Microsoft. The market reaction to the news was tepid, whereas in the past, such circular investment news often boosted stock prices. The current market sentiment has clearly shifted from the belief that AI investments will inevitably yield returns to a more cautious attitude. Investors are becoming less interested in long-term strategies of "invest heavily now, wait for future returns", and are instead focusing on AI business models that can generate profits in the near term. This trend poses new challenges for AI companies that rely on long-term visions and infrastructure providers such as data centers. Re-evaluating the logic of "burn money for growth" The core issue facing AI service providers is that the cost of providing services exceeds the price customers are willing to pay, resulting in larger losses as the customer base grows. These companies' strategy is to subsidize customer growth through shareholder subsidies, creating a virtuous cycle: user growth stimulates investor funding and increased valuation, enabling the company to hire engineers (some paid with equity), subsidize more customers, and invest heavily in infrastructure, with the hope of eventually developing high-quality products that can command full prices. However, investors are increasingly aware of the fragility of this model and are unwilling to continue making massive investments to chase highly uncertain returns. The recent widespread decline in AI infrastructure stocks this month reflects the market's re-evaluation of this "burn money for growth" logic. Investors turning to short-term profit strategies The market's attitude towards AI investments is shifting from expectations of "inevitable returns" to cautious evaluation, but it is far from total rejection. Nvidia's stock price has still risen by over 30% year-to-date, Microsoft's by 14%, and CoreWeave, which expanded from crypto to cloud services since its IPO in March, has seen gains of nearly 80%. The investment logic for artificial intelligence is undergoing a profound transformation, with market attention shifting from long-term visions to short-term profit realization. Investors are no longer blindly chasing the elusive narrative of "superintelligence", but instead placing more importance on whether companies can demonstrate concrete profitability and commercialization in the short term. This shift also explains why Google has shown steady performance in this market fluctuation, as the company focuses on transforming existing technologies into tangible value for enterprise customers, demonstrating a clear path to monetization. It is clear that the market is moving away from concept speculation and demanding companies demonstrate a clear path to profitability. This shift poses pressure to companies that rely on long-term narratives, such as Meta Platforms, OpenAI, and related data center providers. However, at present, this is only a rational correction of investment logic, not the bursting of an AI bubble. This article is reproduced from "Wall Street News" by Li Jia; GMTEight Editor: Xu Wenqiang.