The U.S. is becoming an Nvidia-state.
 

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Matteo Wong

Staff writer

Trying to describe the scale of the AI boom in numbers can feel almost ridiculous. Yesterday, Amazon reported that it had spent more than $35 billion from July through September, mostly to build data centers, and that it expects to keep spending more. The day prior, Microsoft announced that it had spent more than $34 billion over the same time span, and that it also expects future spending to grow. And the day before that, Nvidia became the first company ever to hit a $5 trillion valuation. By one calculation, AI spending accounted for 92 percent of America’s GDP growth in the first half of 2025.

Yet, as Charlie Warzel and I wrote yesterday, “something strange is happening to the economy. Even as tech stocks have skyrocketed since 2022, the companies’ share of net profits from S&P 500 companies has hardly budged.” Twenty-two states are in or near a recession; actual revenues from generative AI are paltry. Perhaps of greater concern, we reported, AI spending is beginning to outpace even the immense profits of Amazon, Microsoft, and the like, and so the companies are beginning to take on debt to finance their expansions. To some observers, the situation is beginning to look awfully reminiscent of the 2008 financial crisis. Should a collapse come, Charlie and I wrote, it would likely be swift and horrible.

Data centers in New Carlisle, Indiana (AJ Mast / The New York Times / Redux)

 

The AI boom is visible from orbit. Satellite photos of New Carlisle, Indiana, show greenish splotches of farmland transformed into unmistakable industrial parks in less than a year’s time. There are seven rectangular data centers there, with 23 more on the way.

Inside each of these buildings, endless rows of fridge-size containers of computer chips wheeze and grunt as they perform mathematical operations at an unfathomable scale. The buildings belong to Amazon and are being used by Anthropic, a leading AI firm, to train and run its models. According to one estimate, this data-center campus, far from complete, already demands more than 500 megawatts of electricity to power these calculations—as much as hundreds of thousands of American homes. When all the data centers in New Carlisle are built, they will demand more power than two Atlantas.

The amount of energy and money being poured into AI is breathtaking. Global spending on the technology is projected to hit $375 billion by the end of the year and half a trillion dollars in 2026. Three-quarters of gains in the S&P 500 since the launch of ChatGPT came from AI-related stocks; the value of every publicly traded company has, in a sense, been buoyed by an AI-driven bull market.

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P.S.

Happy Halloween! If you’re walking about today and marveling at pumpkin carvings, read this lovely story by my colleague Yasmin Tayag. Last year, she explored the world of giant-pumpkin farmers who are trying to hit the 3,000-pound mark. “There must be a limit” to how big a pumpkin can grow, Yasmin wrote. “But nobody has any idea what it is.”

— Matteo

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