AI Spending is Now the #1 Driver of America’s Economy

Watch Our Segment on How AI Is Now the #1 Driver of the American Economy 

Here are two charts that will blow your mind. First, a look at GDP contibution from data centers (in green) versus personal spending (in blue):

AI SPENDING IS EATING THE US ECONOMY

Per @RenMacLLC’s Dutta:

“So far this year, AI capex, which we define as information processing equipment plus software has added more to GDP growth than consumers’ spending”https://t.co/jCHmYVWWiW pic.twitter.com/ewNWu1Rvo0

— Luke Kawa (@LJKawa) July 30, 2025

As you can see, in the most recent quarters, spending on AI data centers is now driving around 1% GDP growth, which is higher than consumer spending. That’s an incredible stat. America’s economy has long been driven by consumer spending – which at times drives more than 2% of all GDP growth. 

And here’s another stat that should astound:

This is insane.

AI capex might account for a larger share of GDP than basically any technology since the railroad.

Basically it’s a mini-wartime economy, but the guns are chips and the tanks are databases pic.twitter.com/E11IxmYtOv

— Derek Thompson (@DKThomp) August 1, 2025

AI spending is now bigger than the telecom boom in 2000. 

With data center spending rising above 1% of GDP, that’s a massive figure. However, its still a fraction the peak economic activity of the railroad buildout in the 1800s which eventually contributed 6% of overall economic activity. 

In the video above, AI Investor Podcast Host Austin Smith and analyst Eric Bleeker look at the historic figures of AI spending and discuss how AI has overtaken consumer spending as the top driver of America’s economy. 

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Transcript 

Eric Bleeker: But Austin, what I’m seeing in earnings season, the biggest, as we’ve said before, what is the strongest force in the known universe?

Austin Smith: Well, typically it’s the American consumer, but I think there’s another major economic predator out there on the horizon right now.

Eric Bleeker: Yes, another economic predator is brewing.

But yes, the American consumer—we will buy anything that’s released. If you go into Five Below or any store, it’s a testament to what the American consumer can do. We will spend into any debt possible. We will take any means to keep buying whatever the world will pump out.

It is rather amazing that we had GDP released this week showing 3% growth, largely driven by the tariff situation with fewer imports into the country. However, what we saw was AI spending actually eclipsing the American consumer. In the latest two quarters, AI spending is now generating about 1% of GDP growth, while consumer spending is at 0.65%.

We are seeing that in earning season. This is what we’re going to talk about today. Some of the results from this earning season show a real inflection point we’ve been discussing in recent episodes. Now we’re seeing it in the numbers. There’s good and some bad, but we are definitively seeing an inflection point. So let’s get started with talking about earnings because we are really in the teeth of earning season.