# AI spending nears $1 trillion annually, risking Nvidia and Micron

Digest AI · Business & Funding · published 2026-10-28T01:20:00Z

Canonical: https://digestai.news/story/ai-spending-nears-1-trillion-annually-risking-nvidia-and-micron

## Summary

AI capital expenditures are approaching **$1 trillion** yearly, fueling demand for chipmakers like **Nvidia** and **Micron Technology**. Both companies reported record revenue in recent quarters: **Nvidia** earned **$96.2 billion** in fiscal 2027’s second quarter, with its data center segment generating **$89 billion**—more than double the prior year’s figure. **Micron** posted **$54.2 billion** in fiscal 2026’s fourth quarter and **$133.2 billion** for the full year, driven by high-bandwidth memory (HBM) demand for AI workloads. Both firms now face risks if AI spending slows, though analysts still rate them as buys with upside potential of **~51%** for **Nvidia** and **~75%** for **Micron**, though at forward P/E ratios of **24x** and **5x**, respectively. **Nvidia**’s growth hinges on sustained AI infrastructure investment, while **Micron** warns of a potential supply glut in memory chips, which could hurt margins if demand falters.

## Key points

- AI spending is nearing **$1 trillion** annually, driving record revenue for **Nvidia** ($96.2B in Q2 2027) and **Micron** ($133.2B in 2026)
- **Micron**’s HBM4 memory products launched in high-volume shipments, but oversupply could collapse prices if demand drops

## Why it matters

A slowdown in AI spending could trigger a sharp correction for chipmakers tied to AI infrastructure, testing valuations of **Nvidia** and **Micron**—the two most exposed players.

## Sources

1. [AI Spending Is Nearing $1 Trillion Annually. These 2 Stocks Are Most at Risk If It Slows.](https://fool.com/investing/2026/10/28/ai-spending-is-nearing-1-trillion-2-stocks-most-at) (fool.com, 2026-10-28)

Part of the developing story: [AI Memory Race Fuels Chip Giants](https://digestai.news/thread/nvidia-named-better-buy-than-micron-as-ai-memory-demand-grows) (2 stories)

## Cite

Digest AI, "AI spending nears $1 trillion annually, risking Nvidia and Micron", 28 October 2026, https://digestai.news/story/ai-spending-nears-1-trillion-annually-risking-nvidia-and-micron

---

Written by Digest AI's editorial model from the linked sources; the sources are the record. Headlines, digests and key points are written by Digest AI and may be quoted with a link to the story page. Linked articles belong to their publishers. Terms: https://digestai.news/terms#reuse
JSON: https://digestai.news/story/ai-spending-nears-1-trillion-annually-risking-nvidia-and-micron.json