Amazon, Google, Meta, Microsoft, and Oracle are pouring mountains of cash into AI data centers. That money flows straight to chipmakers like Nvidia, Broadcom, and Micron. Bank of America calls it a "generational free cash flow transfer."
Chip companies' cash flow keeps rising, but the tech giants' is tanking. Amazon is expected to have negative free cash flow of $12 billion this year—though it still has over $100 billion in the bank.
The risk? Any of these giants could slam the brakes on AI spending. One company pulling back wouldn't matter much, but if they all hit the brakes at once, the chip rally and data center boom would cool fast.