Despite calls for a slowdown in artificial intelligence development, a portfolio manager argues that sustained infrastructure spending will continue to drive the sector forward. Hendi Susanto, a portfolio manager at Gabelli Funds, told MarketWatch that even if leading labs like OpenAI and Anthropic decelerate their progress, "second- and third-tier players" will seize the opportunity to advance, maintaining high demand for AI infrastructure.
Susanto highlighted that growth catalysts such as inference, enterprise AI, and physical AI are still on the horizon. He noted that top AI-infrastructure firms have signaled that demand is likely to outstrip supply at least until next year. He emphasized that building and scaling new capacity takes years, not quarters, which should continue to bolster the AI trade.
The investor pointed to multi-year supply agreements for chips, networking equipment, and other hardware as evidence that the industry is not heading toward a downturn. "That’s not what the front end of a downturn looks like," he said. Susanto views any selloff in semiconductor stocks as a potential opportunity, particularly in higher-risk areas of the AI trade such as next-generation optical connectivity.
The comments come as a contrast to warnings from Citigroup strategists about AI safety concerns that could impact corporate earnings. The strategists warned that a slowdown in AI development could hurt EPS revisions. Additionally, veterans of the "Big Short" trade, including Steve Eisman, Vincent Daniel, and Porter Collins, have cautioned that the AI boom could result in a 'boom, bust' cycle due to concentration risks in the supply chain.
