logo
    • Buy Crypto
    • Markets
    • Futures
    • Spot
    • Earn
    • Affiliates & AI
    • More
    1. WEEX
    2. Crypto News
    3. Is AI Trading Shifting from Chips to Cloud Giants?

    Is AI Trading Shifting from Chips to Cloud Giants?

    By: rootdata|2026/07/07 08:39:38
    0
    Share
    copy
    Prefer us on GooglePrefer us on Google
    AMDAMD
    00.00%--
    SOXXSOXX
    00.00%--
    SMHSMH
    00.00%--
    CHIPCHIP
    00.00%--
     

    TL;DR · Morgan Stanley strategist Michael Wilson believes that AI investments could shift from semiconductors to cloud infrastructure giants like Microsoft, Amazon, and Meta. · The market is divided on whether this rotation is a sign of AI trends spreading or if investors are starting to question the returns on massive AI investments. · Related stocks: MSFT, AMZN, META, NVDA, AMD, SOXX, SMH


    Morgan Stanley's U.S. equity strategist Michael Wilson recently suggested in his strategy outlook that the momentum in semiconductor stocks is waning, and investors should focus more on AI cloud giants like Microsoft, Amazon, and Meta. According to Invezz on July 6, Wilson's team believes that some previously underperforming cloud infrastructure giants are becoming more attractive after fluctuations in chip stocks.


    This statement has been amplified in the market because it reframes the question of AI trading. For the past two years, capital has primarily focused on “who supplies AI.” Now, the market is beginning to ask, “who can turn AI infrastructure into revenue and profit?”


    Companies like Nvidia and AMD are upstream suppliers in the AI construction cycle. Microsoft, Amazon, and Meta, on the other hand, purchase chips, build data centers, and monetize through cloud services, advertising, and AI products.


    If chip price increases are solely driven by orders, then it would be sufficient for capital to continue betting on upstream. However, after a significant rise in semiconductor stocks in the first half of the year, there has been considerable volatility recently, leading to a different question: Is the AI theme cooling down, or is capital merely rotating within AI?


    Chip Volatility Lowers the Odds of Chasing Highs


    Wilson's judgment is based on a straightforward observation: semiconductor trading has become very crowded. The Philadelphia Semiconductor Index previously rose due to AI demand but experienced a notable pullback in early July, followed by a rebound in chip stocks.


    A more reasonable explanation is that semiconductor stocks have already priced in many optimistic expectations. As long as valuations and price increases are sufficiently high, even if the fundamentals do not deteriorate, capital may choose to realize profits.


    For investors, the question is no longer “Are chips good?” but rather “Is it still worth chasing chips now, or do other AI assets offer better odds?” When the upstream has already risen, the market will naturally look for previously lagging segments.


    In Wilson's framework, this rotation represents a shift within AI trading towards leading assets. The theme has not disappeared, but capital is now demanding new proof. Previously, the focus was on orders and deliveries; now it is on usage, revenue, and profit.


    Cloud Giants Are Capturing Monetization Expectations


    Cloud giants have become a destination for capital because they hold two identities. On one hand, they are among the largest buyers of AI chips and data centers. On the other hand, they are also the most likely to commercialize these investments.


    Microsoft can embed AI into office software and cloud services, Amazon has a massive cloud business, and Meta can use AI for ad recommendations, content generation, and foundational models. Compared to pure upstream companies, they also have their existing core businesses providing cash flow buffers.


    This is precisely where the market is re-pricing. In the past, investors were willing to pay for “the intensity of AI construction,” with the most direct beneficiaries being the chip and equipment chains. Now, capital is beginning to pay for “the potential for AI monetization,” and the valuation logic of cloud giants will be re-discussed.


    However, this has not yet been validated. If Microsoft, Amazon, and Meta are to take the baton, they cannot rely solely on the fact that they have “purchased a lot of chips”; they must also demonstrate that capital expenditures can translate into higher cloud revenues, stronger advertising efficiency, or more stable profit margins.


    Capital Expenditure Discipline Changes Pricing


    The pace of capital expenditures by cloud giants is also an important variable. In simpler terms, companies are no longer just competing on who builds more data centers, but are starting to evaluate whether every dollar invested in AI can yield returns.


    In the short term, this could be positive for cloud giants' stock prices. Previously, the market was concerned that they would continue to burn cash for the AI race, dragging down free cash flow and profit margins. If management signals more restrained spending, investors will be more likely to accept the narrative that “AI investments are entering a rational phase.”


    The same situation may not be friendly for upstream. Chip companies need customers to continue placing orders. If cloud giants' capital expenditures merely shift from rapid growth to selective growth, the impact may be limited. However, if spending slows more than expected, semiconductor orders and valuations could continue to be under pressure.


    Thus, the transition to cloud giants does not mean the logic of chips is invalid. Both remain on the same AI industry chain. The change is that the market is no longer rewarding just the scale of investment but is also beginning to reward investment efficiency.


    S&P 8000 Points Requires Market Expansion


    Morgan Stanley has raised its year-end target for the S&P 500 from 7800 to 8000 points in its mid-term outlook. This target provides a larger context for the rotation: if the index is to rise further, it cannot rely solely on a few semiconductor stocks repeatedly lifting it; more heavyweight stocks must embrace the AI narrative.


    From an index perspective, the weight and profit stability of Microsoft, Amazon, and Meta are sufficiently important. If they become the new leading forces, the AI trend will expand from a single upstream trade to a broader re-evaluation of tech stock profits.


    The risk is that price performance can sometimes obscure the nature of capital. If capital is merely withdrawing from chips to seek refuge in cloud giants, and if cloud giants do not form sustained buying pressure, this is not healthy expansion but merely a defensive migration after a crowded trade loosens.


    The two scenarios may appear similar in short-term trends but have different implications for the index. The former corresponds to the AI bull market entering the monetization phase, while the latter corresponds to investors beginning to doubt the returns on AI investments, merely seeking relatively safe docking points within tech stocks.


    Earnings Data Determines Rotation Space


    This rotation will ultimately hinge on a few sets of hard data. The next round of earnings reports from Microsoft, Amazon, and Meta will need to provide clearer clues about AI revenue. Whether capital expenditure guidance shows a mild slowdown or a significant contraction, and whether profit margins can prove that AI investments have not eroded the quality of existing businesses.


    For chip stocks, Nvidia and AMD's orders, guidance, and customer demand are equally critical. If upstream guidance remains strong, the semiconductor pullback may merely be a valuation digestion, and capital could still return to the chip chain. If guidance weakens, the rotation framework will be more readily accepted by the market.


    The more appropriate judgment now is not that the chip era is over, nor that cloud giants will inevitably take over. AI trading is transitioning from supply-side enthusiasm to monetization-side verification. In the next round of earnings reports, whether capital expenditures, cloud revenues, and profit margins can all hold steady will determine whether this rotation is a short-term hedge or whether the AI mainline is entering the next phase.


    -- Price

    --

    This content is provided for general informational purposes only and doesn't constitute financial, investment, legal, or tax advice. Any events, rewards, online promotions, or related information mentioned herein should not be considered a recommendation, solicitation, or invitation to purchase, sell, trade, or otherwise deal in any crypto assets. Crypto assets are highly volatile and may result in loss. The availability of WEEX services, products, and related events may vary by region. You are responsible for ensuring that your participation is in accordance with applicable local laws and regulations.

    You may also like

    Tiger Research: How Far Can On-Chain Forex Settlement Go?

    Tiger Research: How Far Can On-Chain Forex Settlement Go?

    Uber Invests in Zipline to Expand Drone Delivery Services

    Uber Invests in Zipline to Expand Drone Delivery Services

    The generation that grew up with cryptocurrencies is investing like their grandparents

    The generation that grew up with cryptocurrencies is investing like their grandparents

    Four Utilities from 20 Years Ago That Windows 11 Still Can't Replace

    Four Utilities from 20 Years Ago That Windows 11 Still Can't Replace

    Microsoft continues to add features to Windows 11 that many users do not request, while leaving out basic capabilities that existed two decades ago. Autoruns, WinDirStat, Ditto, and VLC are just a few of the free utilities that fill these gaps and that the company's engineers should study.
    AI Storage Chips Strengthen, SK Hynix Continues Pre-Market Rise

    AI Storage Chips Strengthen, SK Hynix Continues Pre-Market Rise

    From Web3 to AI: Why This Group Always Hits the Next Trend

    From Web3 to AI: Why This Group Always Hits the Next Trend

    RDDT Stock Jumps on S&P 500 Inclusion: Is Reddit Stock a Buy Before August 18?

    RDDT Stock Jumps on S&P 500 Inclusion: Is Reddit Stock a Buy Before August 18?

    RDDT stock surged after Reddit was added to the S&P 500. Here's why the stock jumped, the latest price outlook, bull vs. bear case, key risks, and whether RDDT is still a buy before the August 18 index inclusion.
    Kyiv BKK builds new factory near Kyiv for 200 million UAH: exports increased sixfold

    Kyiv BKK builds new factory near Kyiv for 200 million UAH: exports increased sixfold

    How FalconX Brings Institutional Loans on Chain? In-Depth Analysis of FALX Operation Mechanism

    How FalconX Brings Institutional Loans on Chain? In-Depth Analysis of FALX Operation Mechanism

    "If I had 500,000 XRP, I would immediately convert it to bitcoin": Peter Brandt

    "If I had 500,000 XRP, I would immediately convert it to bitcoin": Peter Brandt

    Fastest Way to Buy Directly! Fanatics Invests Heavily in Acquiring a Regulated Exchange, Regular Forces Land in the Prediction Market

    Fastest Way to Buy Directly! Fanatics Invests Heavily in Acquiring a Regulated Exchange, Regular Forces Land in the Prediction Market

    Iron Ore Falls as Chinese Credit Contracts to Record Low

    Iron Ore Falls as Chinese Credit Contracts to Record Low

    IBC-Br Declines 0.6% in June: What This Means for Interest Rates and Investments

    IBC-Br Declines 0.6% in June: What This Means for Interest Rates and Investments

    Ethereum's 'Rate Cut' Debate: Is EIP-8363 a Golden Window for Staking?

    Ethereum's 'Rate Cut' Debate: Is EIP-8363 a Golden Window for Staking?

    U.S. 30-Year Mortgage Rate Falls to 6.67%

    U.S. 30-Year Mortgage Rate Falls to 6.67%

    The 'New Oil' of the AI Era: Computing Power Futures Set to Launch

    The 'New Oil' of the AI Era: Computing Power Futures Set to Launch

    Cardano has two weeks to avoid a governance freeze as 4 committee seats expire

    Cardano has two weeks to avoid a governance freeze as 4 committee seats expire

    Cardano could lose most of its on-chain governance powers after Sept. 1 if it fails to renew 4 Constitutional Committee seats.
    Web3: Israeli Crypto Broker Bits of Gold Reports Data Breach Affecting 200,000 Users

    Web3: Israeli Crypto Broker Bits of Gold Reports Data Breach Affecting 200,000 Users

    New Scam Method Involving XRP

    New Scam Method Involving XRP

    Companies Profiting from War and Expensive Oil: Analyzing 5 Firms from the Warsaw Stock Exchange and Abroad

    Companies Profiting from War and Expensive Oil: Analyzing 5 Firms from the Warsaw Stock Exchange and Abroad

    UK CARF Enters Operational Phase: How Will Service Providers Report and What Impact Will It Have on Investors?

    UK CARF Enters Operational Phase: How Will Service Providers Report and What Impact Will It Have on Investors?

    Strategy Holds 843,775 BTC, Changes Financial Strategy Calculation

    Strategy Holds 843,775 BTC, Changes Financial Strategy Calculation

    The competitive axis of publicly listed companies holding large amounts of Bitcoin (BTC) is shifting from total holdings to per-share holdings and capital procurement structure.
    Anthropic Reveals Claude's Text Watermarking Method

    Anthropic Reveals Claude's Text Watermarking Method

    Anthropic has unveiled a method for embedding a machine-readable watermark in text generated by Claude that is invisible to the human eye. This measure responds to the transparency obligations of the EU AI Act.
    Financialization of AI Computing Power: Open Source Models are Pushing Computing Power to Capital Markets (Part 2)

    Financialization of AI Computing Power: Open Source Models are Pushing Computing Power to Capital Markets (Part 2)

    AI Race: The United States Demands to Choose a Side - The French Mistral Turns to China

    AI Race: The United States Demands to Choose a Side - The French Mistral Turns to China

    web3: Foreign Media: AI Payments and Tokenization May Drive Various Altcoins

    web3: Foreign Media: AI Payments and Tokenization May Drive Various Altcoins

    What is the relationship between BONK and Solana? Understanding BONK's position in the Solana ecosystem

    What is the relationship between BONK and Solana? Understanding BONK's position in the Solana ecosystem

    Ethereum Bulls Pay More: Why Isn't the Market Rising?

    Ethereum Bulls Pay More: Why Isn't the Market Rising?

    ETH consolidates below $1,920 as weak Open Interest, mixed derivative signals, and modest ETF flows reflect cautious demand.
    Web3: Paul Tudor Jones' Fund Replenishes BlackRock's Bitcoin ETF

    Web3: Paul Tudor Jones' Fund Replenishes BlackRock's Bitcoin ETF

    Florida AI Regulation Split into Political Advertising and Data Centers

    Florida AI Regulation Split into Political Advertising and Data Centers

    Florida is addressing artificial intelligence (AI) not as a single comprehensive bill but by dividing it into regulations based on usage, such as political advertising, insurance, data centers, and protection of minors.

    Tiger Research: How Far Can On-Chain Forex Settlement Go?

    Uber Invests in Zipline to Expand Drone Delivery Services

    The generation that grew up with cryptocurrencies is investing like their grandparents

    Four Utilities from 20 Years Ago That Windows 11 Still Can't Replace

    Microsoft continues to add features to Windows 11 that many users do not request, while leaving out basic capabilities that existed two decades ago. Autoruns, WinDirStat, Ditto, and VLC are just a few of the free utilities that fill these gaps and that the company's engineers should study.

    AI Storage Chips Strengthen, SK Hynix Continues Pre-Market Rise

    From Web3 to AI: Why This Group Always Hits the Next Trend

    ...
    Invite friends, get rewards
    Invite to get up to $160 + 40% commission
    Invite friends, get rewardsInvite

    Contents

    AMD

    Latest articles

    08/16/2026

    Mining Companies' Hashrate Decreases by 21.2%, AI Leasing Expands

    The realized hashrate of publicly listed Bitcoin (BTC) mining companies decreased in the second quarter of 2026 compared to the previous quarter. Some companies have turned off mining equipment or reallocated power to AI and high-performance computing (HPC) infrastructure.
    RIOTRIOT
    00.00%--
    MARAMARA
    00.00%--
    HUTHUT
    00.00%--
    AMDAMD
    00.00%--
    ANTHROPICANTHROPIC
    00.00%--
    08/03/2026

    Federal Reserve Credit and Yen Intervention Heat Up Simultaneously, High Funding Costs Reshape Global Asset Pricing

    INDEXINDEX
    00.00%--
    AMDAMD
    00.00%--
    THETHE
    00.00%--
    07/30/2026

    Amazon Reports $62 Billion Profit in Quarter: What Explains the Surge

    AMDAMD
    00.00%--
    REALREAL
    00.00%--
    STARSTAR
    00.00%--
    07/29/2026

    Losing $41.9 Million and Still Terminating the Contract? Block's Major Mining Client Chooses to Exit

    AMDAMD
    00.00%--
    APPAPP
    00.00%--
    POWERPOWER
    00.00%--
    NOWNOW
    00.00%--
    07/23/2026

    AI Agents Drive Up Server CPU Space, Funds Pulling Out of Tech Stocks

    AMDAMD
    00.00%--
    INDEXINDEX
    00.00%--
    CAPCAP
    00.00%--
    More

    Latest coin listings on WEEX

    logoCommunity
    iconiconiconiconiconiconicon
    Customer Support:@weikecs
    Business Cooperation:@weikecs
    Quant Trading & MM:bd@weex.com
    VIP Program:support@weex.com
    • About Us
    • Announcement Center
    • Media Kit
    • WEEX Community
    • WXT Zone
    • Announcement
    • Legal Statement
    • Risk Disclosure
    • Terms and Policies
    • Privacy Policy
    • Whistleblower Notice
    • AML/CTF Policy
    • Law Enforcement
    • User Guide
    • Product Launches
    • Crypto News
    • Product Launches
    • Crypto Wiki
    • Learn
    • Q&A
    • Spot
    • Futures
    • Glossary
    • VIP Program
    • Download
    • Affiliate
    • Protection Fund
    • Proof of Reserves
    • Sitemap
    • ETFs
    • Crypto Prices
    • Price Predictions
    • WXT Price
    • BTC Price
    • ETH Price
    • DOGE Price
    • How to Buy Crypto
    • How to Buy WXT
    • How to Buy BTC
    • How to Buy ETH
    • How to Buy DOGE
    • Help Center
    • Fee Schedule
    • Trading Rules
    • WEEX Academy
    • Contact Verifier
    • Submit Feedback
    • About Us
    • Announcement Center
    • Media Kit
    • WEEX Community
    • WXT Zone
    • Announcement
    • Help Center
    • Fee Schedule
    • Trading Rules
    • WEEX Academy
    • Contact Verifier
    • Submit Feedback
    • Customer Support Bot
    • VIP Services
    • Legal Statement
    • Risk Disclosure
    • Terms and Policies
    • Privacy Policy
    • Whistleblower Notice
    • AML/CTF Policy
    • Law Enforcement
    • Proof of Reserves
    • Invite Friends
    • OTC
    • Download
    • Affiliate
    • VIP Program
    • API
    • Broker
    • Listing Application
    • Affiliate T&C
    • Sitemap
    • Futures
    • Spot
    • Copy Trade
    • Markets
    • WEEX Store
    • User Guide
    • Product Launches
    • Crypto News
    • Product Launches
    • Crypto Wiki
    • Learn
    • Q&A
    • Spot
    • Futures
    • Glossary
    • VIP Program
    • Download
    • Affiliate
    • Protection Fund
    • Proof of Reserves
    • Sitemap
    • ETFs
    • Crypto Prices
    • Price Predictions
    • WXT Price
    • BTC Price
    • ETH Price
    • DOGE Price
    • How to Buy Crypto
    • How to Buy WXT
    • How to Buy BTC
    • How to Buy ETH
    • How to Buy DOGE
    • About Us
    • Announcement Center
    • Media Kit
    • WEEX Community
    • WXT Zone
    • Announcement
    • Help Center
    • Fee Schedule
    • Trading Rules
    • WEEX Academy
    • Contact Verifier
    • Submit Feedback
    • Legal Statement
    • Risk Disclosure
    • Terms and Policies
    • Privacy Policy
    • Whistleblower Notice
    • AML/CTF Policy
    • Law Enforcement
    • Customer Support Bot
    • VIP Services
    • Futures
    • Spot
    • Copy Trade
    • Markets
    • WEEX Store
    • Proof of Reserves
    • Invite Friends
    • OTC
    • Download
    • Affiliate
    • VIP Program
    • API
    • Broker
    • Listing Application
    • Affiliate T&C
    • Sitemap
    • User Guide
    • Product Launches
    • Crypto News
    • Product Launches
    • Crypto Wiki
    • Learn
    • Q&A
    • Spot
    • Futures
    • Glossary
    • VIP Program
    • Download
    • Affiliate
    • Protection Fund
    • Proof of Reserves
    • Sitemap
    • ETFs
    • Crypto Prices
    • Price Predictions
    • WXT Price
    • BTC Price
    • ETH Price
    • DOGE Price
    • How to Buy Crypto
    • How to Buy WXT
    • How to Buy BTC
    • How to Buy ETH
    • How to Buy DOGE

    Where new wealth is made

    Download app

    Sign Up
    h5 logo
    Download