AI DEMAND ISN’T THE PROBLEM I’ve been saying for a while that AI demand isn’t what concerns me. It’s how much money these companies need to raise before their investments start generating meaningful returns. Now we’re seeing reports that Blackstone $BX expects Anthropic $ANT to receive a BB-range junk credit rating following its IPO, potentially making it more expensive to finance its massive AI infrastructure expansion. For context, Anthropic is involved in a $63B financing deal to lease 1.5 GW of Google’s AI chips, with Broadcom $AVGO guaranteeing more than $42B in senior loans and Blackstone investing $9B in junior debt yielding over 10%. That’s a lot of money, and those borrowing costs matter. But here’s why I’m not changing my long-term outlook on AI. Look at what we just heard from the hyperscalers: Google $GOOGL: Cloud revenue grew 103% YoY to $30.7B. Amazon $AMZN: AWS grew 39.3% YoY, its fastest growth in nearly five years. Amazon expects AWS revenue growth to exceed 40% in both 2027 and 2028. Google expects CapEx to increase significantly in 2027 as demand for its infrastructure continues growing. These are not small numbers, and they’re coming from businesses already generating substantial operating profits. The distinction I’m making is between demand and financing. I think the market is becoming increasingly concerned about how companies like Anthropic, OpenAI, and the neocloud providers will finance their expansion without putting too much pressure on their balance sheets. And I think that’s a legitimate concern. However, when I see Google Cloud more than doubling revenue and Amazon projecting another two years of 40%+ AWS growth, it’s difficult for me to argue that the demand isn’t there. My focus remains on which companies can turn that demand into sustainable free cash flow without constantly relying on outside financing. I remain bullish on AI, but I don’t believe every company funding this expansion will be a winner.