Microsoft Faces AI Crash Warning as Hon Hai Posts 29.7% Sales Growth
Former CIA advisor Jim Rickards warns of an imminent AI market collapse, citing overvalued sector players and paralleling past 2008 and 2020 downturns that could pressure Microsoft’s AI-driven revenue. Hon Hai reported 29.7% sales growth to NT$2.13 trillion on AI infrastructure demand, supplying servers to Microsoft.
1. Crash Warning from Jim Rickards
Jim Rickards, an economist and former CIA advisor, cautioned that the artificial intelligence sector shows clear overvaluation signs and risks an imminent collapse, drawing parallels to the 2008 financial crisis and the 2020 pandemic-induced downturn. He emphasized that major AI executives have publicly acknowledged inflated valuations and predicted significant corrections, raising concerns over potential hits to Microsoft’s AI revenue streams.
2. Hon Hai's AI-driven Sales Growth
Hon Hai Precision Industry achieved 29.7% year-over-year quarterly sales growth to NT$2.13 trillion for the period ending March, driven by robust AI infrastructure demand. The company supplies servers powered by leading accelerators to Microsoft and other tech giants, positioning itself to benefit from projected AI spending growth despite geopolitical and supply chain uncertainties.