Man with virtual white circles on his eye and AI written on top, symbolising artificial intelligence.

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The rise of artificial intelligence (AI) has been a common investment theme over the past few years. 

AI enthusiasm has largely driven the dominant performance of the Magnificent Seven stocks. 

Recently, massive amounts of capital have been poured into AI investments.

According to Stamford University, corporate AI spending reached US$252.4 billion in 2024, marking a thirteenfold increase since 2014. 

Meanwhile, America’s biggest tech companies have pledged to spend US$320 million on capital expenditure in 2025, with the majority going towards AI infrastructure.

Notably, most of these initiatives are yet to be profitable. 

This has drawn parallels between today’s environment and the 2000 dot com bubble.

Macquarie rejects the bubble narrative

In a 26 September research note, ‘AI capex & lessons from the Internet boom’, Macquarie Group Ltd (ASX: MQG) laid out the case for why the AI boom is likely to continue. 

Macquarie rejected the bubble narrative, instead suggesting it believes capital expenditure will continue to rise:

We focus on hyperscaler capex, which is up 180% since ChatGPT. We think we are still in the positive side of the boom, where capex expectations will continue to rise. China hyperscaler capex only started to surge in 2025. We also think the AI boom may not be over until either OpenAI or xAI are listed (perhaps both) or for there to be a mega-merger of two leading tech companies. We think AI capex shifts the macro risks towards stronger growth and inflation in 2026.

Macquarie described equity sentiment as “positive but not too positive” and cited its “FOMO Meter” reading of +0.68. For reference, more than -1.0 suggests fear in the market, while a reading above +1.0 suggests greed. 

The broker also compared the ASX 20 from March 2000 to today, noting that the ASX had significantly more exposure to the internet boom in 2000. 

However, Macquarie did draw an interesting parallel with the dot com boom. During that time, defensive stocks were a laggard, which is playing out today with Woolworths Group Ltd (ASX: WOW) and CSL Ltd (ASX: CSL) substantially underperforming the market this year.

Macquarie’s top AI ASX stock picks

Most investors are familiar with the US market’s most prominent AI stocks. 

These include Nvidia, Microsoft, and Meta Platforms. 

However, ASX-listed stocks with exposure to the AI thematic are less widely known.

In its research note, Macquarie named Next DC Ltd (ASX: NXT), Megaport Ltd (ASX: MP1), and Goodman Group Ltd (ASX: GMG) as key stock picks in the AI space. Macquarie’s price targets for these three stocks are $22.30, $16.90, and $34.73, respectively.