The artificial intelligence market is showing a bubble that has already surpassed the infamous dot-com bubble of the late 1990s in scale. As an analyst, I am closely monitoring these parallels, and the data we see today raises serious concerns about the sector overheating.
The key difference lies in the volume of capital. During the dot-com era (1999–2001), total infrastructure spending amounted to about $500 billion. Today, in 2025–2026, this figure has soared to $5.8 trillion. That is more than a tenfold increase.
Another alarming signal is the size of offerings. The largest IPO during the dot-com era raised about $4 billion. Now, this figure has reached $86 billion. At the same time, companies going public are often unprofitable. The most expensive unprofitable company of the dot-com era was worth about $100 billion. Today's equivalent is valued at $965 billion.
We are seeing classic signs of overheating. Unprofitable companies are going public at the peak of hype. For example, SpaceX already went into the red a month after the largest IPO in market history. This reminds me of the situation with Lucent and Nortel in the late 1990s, which financed their clients and ultimately went bankrupt.
Why is the current bubble more dangerous?
The main danger is that the dot-com bubble was primarily a stock market bubble. Today's AI bubble includes private credit, project bonds, and even insurance company money. This entire multi-layered structure flows into data center infrastructure.
Examples are alarming. Blue Owl froze investor withdrawals while simultaneously financing 80% of Meta's (banned in Russia) $250 billion campus in Louisiana. Oracle's rating was downgraded to nearly "junk": half of its order portfolio is tied to OpenAI. Anthropic has $90 billion in capacity lease obligations with zero profit before its IPO.
AI is a real technology, just like the internet in 1999. But the question is not about the technology, but about the price. Do the companies justify the amounts investors are paying for them? Public reports will soon provide the answer. My forecast: a correction is inevitable, and it will be painful for those who do not understand the difference between innovation and speculation.