BlackRock’s latest Investment Directions report shows a clear change in how institutional investors are approaching artificial intelligence. While big tech companies drove gains in 2025, the attention is now moving toward the real-world infrastructure needed to power AI systems.
From Software Giants to Energy and Infrastructure
The report, based on a survey of 732 clients in Europe, the Middle East and Africa, reveals a sharp drop in enthusiasm for the largest U.S. tech firms:
- Only 20% still see them as the top AI investment opportunity
- More than 50% now prefer companies that supply massive amounts of electricity for data centers
- 37% point to infrastructure players, such as those building cooling systems and grid upgrades
Why the Rotation?
The enormous capital needed for data centers has raised questions about returns and debt levels among software leaders. AI growth requires trillions of dollars in upfront spending on power, hardware and facilities — costs that come long before the technology starts generating strong profits.
BlackRock’s U.S. equity head Ibrahim Kanan explained that investors are now seeking a more balanced approach. They want to reduce heavy exposure to a few tech names while capturing growth in the supporting supply chain.
No Bubble Fears Yet
Despite the shift, confidence in the AI theme remains strong. Only 7% of those surveyed believe the sector is currently overvalued or in bubble territory.
The outlook points to 2026 as the year of the “AI backbone” — the energy providers, grid operators and infrastructure builders that make advanced computing possible.
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