PremiumMorgan Stanley's Own Math Puts The AI Buildout Underwater
Somewhere in Morgan Stanley's math on artificial intelligence is a data center where everything goes right. It draws as much electricity as a mid-sized city, it is packed with Nvidia's newest chips, and it runs them as fast as the hardware will go. Yet even at full optimization it costs $25 billion a year to rent all that equipment - to produce and sell only $23 billion of output. Already underwater - and Morgan Stanley expects the selling price to keep falling: "likely to go lower over time," in the bank's own words.
Why?
| Hourly Price | Revenue ($B) | EBIT ($B) | ROIC |
|---|---|---|---|
| $7.00 | 18.9 | 11.2 | 23% |
| $8.50 (base) | 22.9 | 15.3 | 31% |
| $10.00 | 27.0 | 19.3 | 39% |