Artificial intelligence infrastructure spending by the five largest U.S. hyperscalers will reach $1.2 trillion in 2027, up from $800 billion this year, Goldman Sachs Group strategists said, according to a Friday (Sept. 25) report by Bloomberg.

Goldman Sachs Group’s forecast for next year is higher than the Wall Street consensus of $1.1 trillion, according to the report.

The five hyperscalers included in the forecast are Amazon, Alphabet, Microsoft, Oracle and Meta, per the report.

The hyperscalers’ 2027 capital expenditures will amount to “a larger share of GDP than any technological investment cycle since the railroad build-out in the late 1800s,” the Goldman Sachs Group team led by Ryan Hammond said, per the report.

After the 54% jump in hyperscaler capital expenditures in 2027, the team forecasts a 12% increase in 2028 that will bring that year’s total to $1.4 trillion, according to the report.

JPMorganChase Chairman and CEO Jamie Dimon told CNBC Monday (Sept. 21) that hyperscalers could spend $1 trillion next year, up from $700 billion this year and $300 billion last year.

“That’s like a 1% increase to GDP each year and obviously it may add a little bit to inflation because you’re hiring people, you’re building factories, you’re buying equipment and copper wires, and building powerplants and all of that,” Dimon said. “But it’s an unbelievable technology, so down the road it could very well enhance deflationary factors out there. It looks like it’s going to continue.”

Nvidia Founder and CEO Jensen Huang said during a May earnings call that hyperscaler capital expenditure on AI alone is forecast to exceed $1 trillion in 2027 and that AI infrastructure spending could reach $3 trillion to $4 trillion annually by the end of the decade.

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