The engine behind AI

Nearly every major AI breakthrough we hear about today is powered by a small group of companies known as hyperscalers.

Hyperscalers are the operators of massive cloud computing platforms and global data center networks that provide the computing power, storage, and infrastructure needed to train and run AI models at scale. As AI adoption accelerates, hyperscalers are becoming some of the largest capital spenders in history, investing hundreds of billions of dollars into the AI ecosystem through data centers, chips, networking, and energy infrastructure.

Understanding where they are investing provides a powerful lens into the future of AI. It can help identify not only which hyperscalers are best positioned to benefit, but also which companies across the AI value chain stand to gain—or potentially lose—as the technology evolves.

Hi, I’m Pri Bakshi. I’m both Fidelity’s technology sector leader and a portfolio manager. My role at Fidelity gives me a front-row seat into the most important trends shaping the tech sector. Having covered many of the world's largest technology companies across the U.S. and Asia, I have developed relationships throughout the ecosystem, including with hyperscalers and AI labs that are driving the next wave of innovation. These insights help inform how I manage the Fidelity Select Technology Portfolio, Fidelity Advisor Technology Fund, the Fidelity Select Communications Services Portfolio, and Fidelity Advisor Communication Services Fund.

My focus is on identifying high-quality companies with meaningful exposure to AI, whether they are the hyperscalers themselves or the businesses providing the critical infrastructure that makes AI possible. At the same time, I remain focused on other technology trends that can drive long-term growth, helping ensure that the portfolios are diversified across multiple sources of opportunity.

As AI continues to reshape the technology landscape, one of the most important signals investors can follow is where hyperscalers are spending. Understanding these spending patterns can help identify where value is being created and where some of the most compelling investment opportunities may emerge.