Lightnews — Scholar-powered news

I was already a hard AI-skeptic but this cements my long suspicion that there is no feasible path to anything close to return on invested capital for these data centers. Tech would need 15 to 25 times current AI revenues within the next 2-3 years just to break even. Not financially viable.

"I clearly hit a nerve in the industry, when judging by the number of individuals who reached out to chat," he wrote in an followup blog post. "In total, l've spoken with over two-dozen rather senior people in the datacenter universe, and there was an interesting and overriding theme to our conversations: no one understands how the financial math is supposed to work. They are as baffled as I am, and they do this for a living."
Kupperman's original skepticism was built on a guess that the components in an average Al data center would take ten years to depreciate, requiring costly replacements. That was bad enough: "I don't see how there can ever be any return on investment given the current math," he wrote at the time.
But ten years, he now understands, is way too generous.
" had previously assumed a 10-year depreciation curve, which I now recognize as quite unrealistic based upon the speed with which Al datacenter technology is advancing," Kupperman wrote. "Based on my conversations over the past month, the physical data centers last for three to ten years, at most."
In his previous analysis, Kupperman assumed it would take the tech industry $160 billion of revenue to break even on data center spending in 2025 alone. And that's assuming an incredibly generous 25 percent gross margin - not to mention the fact that the industry's actual Al revenue is closer to $20 billion annually, as the investment manager noted in his previous blog.

"In reality, the industry probably needs a revenue range that is closer to the $320 billion to $480 billion range, just to break even on the capex to be spent this year," Kupperman posited in his updated essay. "No wonder my new contacts in the industry shoulder a heavy burden - heavier than I could ever imagine. They know the truth."
Kupperman called that gulf between tech industry spending and actual revenue in 2025 "astonishing."
However, it doesn't even begin to scratch the surface. For example, how does it all shake out when we account for 2026, when hundreds of new data centers are expected to pop up?
"Adding the two years together, and using the math from my prior post, you'd need approximately $1 trillion in revenue to hit break even, and many trillions more to earn an acceptable return on this spend," he writes.
"If the economics don't work, doing it at massive scale doesn't make the economics work any better
- it just takes an industry crisis and makes it into a national economic crisis," he concludes.
Overall, the pessimists broadly agree: it's no longer a matter of if Al is massively overhyped, but when the whole thing comes crashing down.
More on Al hype: Data Shows That Al Use Is Now Declining at Large Companies

11 160 440

Batman antiespañol que da pábulo a la Leyenda Negra @santimrey.bsky.social · 9h

Yo llevo usándola dos años ya. No he usado otras, pero esta está muy bien incluso la versión gratis (aunque a lo mejor para calistenia te faltan algunos ejercicios). Pruébala, a ver qué te parece

Batman antiespañol que da pábulo a la Leyenda Negra @santimrey.bsky.social · 10h

Soy nuevo aquí, qué es "esto"?

1 1

Batman antiespañol que da pábulo a la Leyenda Negra @santimrey.bsky.social · 10h

A favor de las hamburguesas con mollete

Batman antiespañol que da pábulo a la Leyenda Negra @santimrey.bsky.social · 10h

a man in a tuxedo is holding a red cloth with the words my job here is done below him

ALT: a man in a tuxedo is holding a red cloth with the words my job here is done below him

media.tenor.com

1 2

Batman antiespañol que da pábulo a la Leyenda Negra @santimrey.bsky.social · 10h

Tienes Hevy?

Batman antiespañol que da pábulo a la Leyenda Negra @santimrey.bsky.social · 10h

Juan Carlos Girauta

2 4

Batman antiespañol que da pábulo a la Leyenda Negra @santimrey.bsky.social · 10h

Olía la casa a pimientos asados y mermelada de cebolla 🤤😋

Batman antiespañol que da pábulo a la Leyenda Negra @santimrey.bsky.social · 10h

Mi bluit iba por la frase que se suele añadir detrás de dicho número...

1 2

Batman antiespañol que da pábulo a la Leyenda Negra @santimrey.bsky.social · 10h

Coincido

1 1

Batman antiespañol que da pábulo a la Leyenda Negra @santimrey.bsky.social · 10h

Y cuántos puntos 🧐