AI Reshapes Technology, Investment, and the Global Economy
AI continues to drive a profound transformation across business models and the global economy, spanning from tech giants building massive GPU clusters to CEOs of leading technology firms racing toward the same ambitious goal.
Danny Fish, Portfolio Manager of Technology & Innovation and Research Analyst at Janus Henderson, described the current wave as “unparalleled in the technology world”, stressing that its long-term implications will extend to governments, investors, and corporations alike — particularly in the Gulf region, where AI is already shaping markets, policies, and leadership across industries.
Fish noted that nearly all top tech executives share the same pursuit, calling it an “existential matter, both positive and negative.” Initially, investor sentiment around AI was mixed. In early 2025, the launch of DeepSeek triggered uncertainty as markets questioned whether massive capital expenditures on computing power would yield returns. That ambiguity dissipated after Microsoft’s April earnings report, when expanded infrastructure translated into higher revenues, marking a turning point with tangible gains.
This reevaluation coincided with the rapid adoption of AI. Roughly half of S&P 500 companies referenced AI in their first-quarter reports, underlining its swift integration across sectors. Still, Fish argued that markets continue to underestimate AI’s earnings potential, despite its increasing role in software development, research, support, and marketing.
“Microsoft exemplifies this dynamic,” Fish explained. “Its core revenues accelerated even as headcount declined — a clear signal of margin expansion driven by AI productivity gains.”
Yet, challenges remain. Data centers face lengthy approval and energy-connection processes, while training clusters are scaling from hundreds of thousands of GPUs to even larger systems. Fish predicted a temporary investment pause as companies absorb recent capital spending but expressed confidence in the multi-year trajectory toward more advanced inference capabilities.
Governments, meanwhile, are recalibrating policies. According to Fish, AI is now seen as a pillar of economic strength, social empowerment, and national security. Software remains relatively insulated from tariffs, but consumer internet faces rising exposure to digital taxes, and hardware supply chains are undergoing broad diversification. AI server assembly in Mexico under the USMCA framework, alongside supply chain restructuring, highlights how AI has become both an economic and geopolitical priority.
Opportunities in the Gulf
The global AI race is translating into local opportunities in the Gulf. In the UAE, Microsoft invested $1.5 billion in G42, the Abu Dhabi-based AI and cloud computing company, while the Technology Innovation Institute launched its open-source Falcon 2 model in May 2024. In Saudi Arabia, Microsoft has completed construction of three Azure data center sites, slated to go live in 2026, and the Public Investment Fund has partnered with Google Cloud on a $10 billion AI hub near Dammam.
Fish highlighted three key indicators investors should watch going forward: expanding profit margins driven by AI-enabled productivity gains; the pace of data center construction and energy contracts, which will determine deployment speed; and the balance between broad AI platforms and specialized models that can generate faster returns.
“This dual path — advanced general capabilities on one side and short-term revenue drivers on the other — will define where sustainable returns can be found,” Fish concluded.