Nvidia and AMD Hit Record Highs as Big Tech Plans $725 Billion in AI Capex for 2026

Nvidia and AMD shares both closed at record highs Friday as investors rushed to capture what Goldman Sachs describes as the next leg of the AI rally, with the bank projecting double-digit data center revenue growth for years ahead. BNP Paribas added to the bullish sentiment by raising its Nvidia price target to $345, implying roughly 47% further upside, citing the company's advantages in AI workloads and networking as well as its ongoing share buyback program.

The scale of AI infrastructure spending underpins that optimism. Amazon, Alphabet, Microsoft, and Meta together plan to spend approximately $725 billion on capital expenditures in 2026, with the majority directed at AI data centers. Nvidia's data-center business is running at roughly $355 billion in annual revenue, representing close to half of that combined capex figure, a dramatic shift from approximately 10% in 2022.

Not all voices are bullish. Debate is intensifying over whether AI chip economics resemble a dot-com era bubble, with some analysts arguing chips are becoming commoditized and others pointing to Nvidia's valuation as a counterargument to bubble fears. Calls to slow development of the most powerful AI models are also running up against an estimated $800 billion global investment wave, raising questions about what a mandated slowdown would mean for growth.

On the competitive front, a Bloomberg Intelligence report found the performance gap between top US and Chinese AI models has narrowed to just 3%, down from 15% earlier in 2026, a shift that adds urgency to the infrastructure race. Meanwhile, enterprise AI firm Cohere launched North 2, a new platform giving AI agents persistent memory and tighter operational controls aimed at regulated industries.