Wall Street's AI math doesn't add up
QQQ•Technology analysts project the sector's operating cash flow will more than double to roughly $2.4 trillion by 2028, an increase of more than $1.2 trillion, while analysts covering its customers forecast much weaker growth.
1. Forecasts diverge
Apollo Global Chief Economist Torsten Slok says Wall Street's forecasts for technology companies and the companies expected to pay for AI services do not align. Tech's outlook assumes explosive demand, while analysts tracking likely buyers see far less spending power.
2. Who will pay?
Slok says either corporate America will generate far more cash than currently forecast, or tech companies' cash flow projections are too optimistic. He said the gap raises the question of who will write the checks for the AI boom.
