Did the AI Bubble Burst as U.S. Tech Stocks Plummet? You Ting-hao Highlights Missing 'Key Condition': Computing Overcapacity Still Far Off

The U.S. 'Magnificent 7' tech giants have recently released their Q2 financial reports. Companies such as Alphabet and Meta have seen a sharp decline in free cash flow while significantly increasing capital expenditure, sparking market concerns over AI investment. In response, financial commentator You Ting-hao stated on the program 'Financial Hao Jiao' that AI has not yet reached a bubble phase. You emphasized that the psychological sentiment has not reached a bubble-level peak, and more importantly, the necessary conditions for a bubble have not fully materialized. He outlined four key indicators of a bubble: 'technological revolution,' 'price surge,' 'flood of capital,' and 'supply bottleneck.'

You pointed out that the only missing condition for AI is 'supply bottleneck'—which he considers the most crucial. He illustrated with historical examples: 'When did the railway bubble burst? When too many tracks were built. When did the internet bubble burst? When internet companies sprang up everywhere. When did the NFT bubble burst? When NFTs were being created en masse.'

You stressed that for AI, the bursting point will come not just from market sentiment, but most critically from computing overcapacity. He explained, 'When we have massive computing power but productivity barely improves—that’s when the bubble is about to burst.'

However, You argues that even the completion of sufficient AI data centers remains a major challenge. Citing a Gallup Poll, he noted that 48% of U.S. residents 'strongly oppose' and 23% 'somewhat oppose' the construction of AI data centers near their communities. He believes this public resistance is significantly delaying data center deployment.

As a result, AI data center construction plans will fall far short of expectations, pushing back the timeline for computing overcapacity. 'We will not see computing overcapacity in the next five years,' he asserted.

Therefore, You views the recent stock price declines as a market-driven valuation correction based on sentiment. He explained that investors are worried about an AI bubble and now demand that tech giants justify their capital spending, ensuring it generates tangible returns. 'You must show the market that your money is being spent wisely,' he said, emphasizing the need for clear AI revenue feedback.

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