Ai Ai Ai Ai, canta y no llores...

This week, investors made like Trini Lopez and there was a whole lotta Ai Ai Ai Ai in stock markets. But despite blistering sales numbers, the gloss came off as investors cried at the amount that the Big Dogs are planning to spend on AI.

Microsoft, Apple, Amazon, Tesla, and Google have all reported arguably good results over the last week. Apple made $117 billion in the last three months of 2025. Revenues at Microsoft’s cloud division were up by about 26%. Tesla will be rolling out driverless taxis in more US cities in the next 6 months, including Dallas, Houston, and Las Vegas, with dedicated production of its robotaxi fleet starting in April. Money and progress are being made.

Are they too proud in the Cloud?

By Thursday, any initial collective gloss had come off as people worried about valuations, spending on AI, and a softer jobs market. The tech-heavy US index – the Nasdaq – is down about 4% this week. Ouch.

Amazon fell 11 per cent after market on Thursday, after saying it would spend a massive $200bn this year on development – $50bn more than expected and a Very Big Number.

Apple is an outlier, spending less. They have decided to be the distribution layer, and make money from devices and services, ‘renting’ AI capability from others like Google. So, they avoid the big development bills (known as capital expenditure or ‘capex’). And have a sort of pay-as-you-go model funded by their customers (which comes from operational expenditure or ‘opex’). To put it another way, they’re giving their customers the chance to cook in the same kitchens and sleep in the same bedrooms, but they’re renting rather than buying spades and building the properties.

As understanding of AI gradually grows, investors have shifted from giddy cheque-writing euphoria towards higher expectations of seeing their investment turn into shorter-term revenues. So, firms which unveil massive spending plans with limited revenue gains today to show from it are being judged more harshly.

The big debate remains the same. Is this a bubble with people chasing a dream which will not deliver the revenues? Or is it a technical revolution which will create the megacompanies of the future, with whopping market shares and tasty revenues? If like me you’re not sure, we stay invested but make sure we have enough in other markets and other sectors to cushion any blows. For example, the wonderfully boring foundation of my pension is the iShares Core MSCI World Exchange Traded Fund. Has over 1,000 companies in it with about 30p of every £1 invested in technology and software. Then I back off from tech a bit with other investments.

From Cloud to well endowed

Nervous Cloud-ers are looking at harder tangible things which we can see, use, dig for, and touch. Gold and resources are the global antidotes to Silicon Valley’s hoodies and both Donald Trump and investors are on the hunt for sectors and countries which are well endowed.

One theme playing out is Resource Nationalism. As seen from US behaviour, this is when countries become reluctant to buy natural resources on the open market and seek more control instead. They don’t want to be hung out to dry by an unpredictable third-party nation with a grudge. This is not unrelated to the AI boom – a typical AI data centre could use up to 50,000 tonnes of copper.

The other theme is everyone getting more disillusioned with the US dollar. Trump doesn’t play by the rulebook and the debt in the US is sky high. So gone are the days of people thinking that if everything went a bit ‘bat-sh1t crazy’, that the US dollar would sail majestically through the storms as a reliable store of value. This means that the dollar has lost some of its status as a so-called ‘safe haven’ asset, and gold has picked up some of the money looking for a safe home.

A safe home, maybe, but still a very volatile and potentially over-priced one. This week, gold was up and down more than an Olympic ski jumper’s thingy (sorry, sorry, I couldn’t resist that!) On Monday this week, the price of gold fell to about $4,430 an ounce before jumping back above $5,000 on Wednesday.

Over and out for this week – have a great weekend, everyone. We survived the 18th party at our house last Saturday. I’m still finding stray vodka bottles in the flower beds and think the neighbours have just about forgiven us. We “only” had about 140 teenagers in the end, and my patio looked like the Hacienda in the 90s. I had a great time in between paramedic and counselling duties!

Holly