Technology / Semiconductor / Internet Research

Nicolas Baratte

Nicolas Baratte has been a financial analyst since 2000, covering the Semiconductor sector and Global Technology. Nicolas has worked on the sell-side for JPMorgan, CLSA. On the buy-side for a Tiger fund and Prudential. Nicolas has covered semiconductors, Asian hardware and components, and the Global Tech supply chain. Nicolas lives mostly in Taiwan, sometimes in France and is in New York regularly.

Hyperscalers: What Is Consensus Forecasting? Good or Bad? How Much Capex Can They Spend?

Is Software Getting Cheap? De-Rating, but Not Cheap. Hyperscalers and Some Fintech More Interesting.

Hyperscalers’ Capex Update. Remember Jensen’s $500bn Yesterday ?

Alphabet. More Of The AI, Less Of The Drama

Google: Very Impressive. Higher Capex, Higher Growth & Margins

Alphabet (GOOG US) - 3Q25 Results Beat; Upbeat on AI and Cloud Business Momentum

Equity Bottom-Up

<ul>
<li>I’ve compiled a large set of financial data to measure the impact of the AI Capex boom on the financial health of the 4 hyperscalers.</li>
<li>We can't measure the ROI of AI, but very clear that 1) operating margins and operating cash flow are increasing 2) higher Capex puts mild pressure on Free Cash Flow.</li>
<li>The major negative is that asset turns keep declining. This isn’t AI-specific, it started 10 years ago. Hyperscalers have become asset-heavy, high fixed costs companies. </li>
</ul>


I’ve compiled a large set of financial data to measure the impact of the AI Capex boom on the financial health of the 4 hyperscalers.
We can't measure the ROI of AI, but very clear that 1) operating margins and operating cash flow are increasing 2) higher Capex puts mild pressure on Free Cash Flow.
The major negative is that asset turns keep declining. This isn’t AI-specific, it started 10 years ago. Hyperscalers have become asset-heavy, high fixed costs companies. 


Hyperscalers: Is AI Capex Too High? What’s AI Return on Investment?