Foundation models (OpenAI, Anthropic, Google, Meta)
Services
E-commerce and web services (Amazon, Pets.com)
AI applications and business software
Overlaying the two booms
Day zero is Netscape's IPO (9 Aug 1995) for 2000 and ChatGPT's launch (30 Nov 2022) for today. The x-axis counts months from there.
46 months after ChatGPT's launch (30 Nov 2022), the Nasdaq Composite stands at 2.36 times its starting level. The same 46 months after Netscape's IPO (9 Aug 1995), in Jun 1999, the Nasdaq Composite was at 2.47 times, and it went on to 5.02 times at its peak in month 55.
Nasdaq Composite (start = 100, log scale)
46 months after ChatGPT's launch (30 Nov 2022), NVIDIA stands at 13.30 times its starting level. The same 46 months after Netscape's IPO (9 Aug 1995), in Jun 1999, Cisco was at 9.06 times, and it went on to 25.04 times at its peak in month 56.
Cisco from Netscape's IPO vs NVIDIA from ChatGPT's launch (start = 100, log scale)
46 months after ChatGPT's launch (30 Nov 2022), the chip index stands at 4.48 times its starting level. The same 46 months after Netscape's IPO (9 Aug 1995), in Jun 1999, the chip index was at 1.51 times, and it went on to 4.91 times at its peak in month 55.
PHLX Semiconductor Index (start = 100, log scale)
What looks the same
Equipment makers are funding their customers
2000
In fiscal 2000 Lucent had $8.1bn of customer financing commitments, about a quarter of revenue; Nortel had $3.1bn and Cisco $2.4bn. When the start-up carriers failed, Lucent booked $3.5bn of bad debts in 2001–02.
Now
In September 2025 NVIDIA signed a letter of intent to invest up to $100bn in OpenAI in stages (still not definitive in December); OpenAI uses the money to buy NVIDIA systems. In October AMD gave OpenAI warrants for about 10% of its shares at $0.01 alongside a 6GW GPU order. OpenAI was also reported to have signed a roughly $300bn five-year compute deal with Oracle.
Investment is bigger, relative to the economy, than in 2000
2000
US investment in information processing equipment and software peaked at 4.46% of GDP in Q4 2000.
Now
In Q2 2026 it stands at 4.96%, above the 2000 peak. Within it, spending on computers and peripherals (including servers) is up 58% on a year earlier (the late-1990s high was 15%).
The market leans on its leader more than in 2000
2000
At the March 2000 peak Cisco was worth 5.5% of US nominal GDP.
Now
Today NVIDIA is worth 16.7% of GDP, 3.0 times Cisco at its peak.
The same cheerleader is back
2000
SoftBank's stakes in Yahoo and others briefly lifted its market value above ¥20 trillion, second in Japan after Toyota. The bust cut its share price by 98.6%.
Now
This time it is again the cheerleader, with a large investment in OpenAI and the Stargate data centre plan with OpenAI and Oracle.
What is different
The big spenders are paying from their own earnings (so far)
2000
The fibre was laid by carriers funded with bank debt and junk bonds.
Now
Capex at the five giants (Microsoft, Amazon, Alphabet, Meta, Oracle) was 83% of their operating cash flow over the last four quarters. The ratio keeps rising, though, and Amazon and Oracle are already above 100%. Borrowing and off-balance-sheet funding, such as Meta's $27bn Hyperion joint venture with Blue Owl, are growing too.
Prices have not risen as steeply as in 2000
2000
The Nasdaq-100 rose 485% in the three years to March 2000.
Now
Over the last three years it is up 107%: a big gain, but nothing like the 2000 run.
The leader is far cheaper relative to earnings than in 2000
2000
At the March 2000 peak Cisco traded at about 200 times earnings: paying for two centuries of profit up front, on the assumption that profits would compound furiously for years.
Now
NVIDIA trades at 28 times. The Nasdaq's path looks like 1999, but the earnings behind the leader are of a different order. Those earnings are, however, its customers' capex, and they would shrink if the spending stopped, just as in 2000.
What is left behind wears out faster
2000
Fibre lasts for decades. The overbuilt capacity still had value ten years after the bust.
Now
GPUs turn over quickly, and the big clouds depreciate servers over five or six years. After a bust, what can be picked up cheaply may be power contracts, land, buildings and grid connections rather than the chips.
Interest rates are moving the other way
2000
The Fed raised rates by 1.75 points between June 1999 and May 2000; the Nasdaq peaked in the middle of it.
Now
The policy rate is 3.63%, -0.70 points versus a year ago. This is not a tightening cycle.
Big-five capex
Microsoft, Amazon, Alphabet, Meta and Oracle, from their SEC filings. Finance leases (used heavily for data centres) are not included, so true spending is higher.
Over the last four quarters the five spent $586bn on capital expenditure, 83% of their operating cash flow ($707bn).
Quarterly capex, $bn (calendar quarters)Show the numbers
Quarter
MSFT
AMZN
GOOGL
META
ORCL
2024Q3
14.9
22.6
13.1
8.3
2.3
2024Q4
15.8
27.8
14.3
14.4
4.0
2025Q1
16.7
25.0
17.2
12.9
5.9
2025Q2
17.1
32.2
22.4
16.5
9.1
2025Q3
19.4
35.1
24.0
18.8
8.5
2025Q4
29.9
39.5
27.9
21.4
12.0
2026Q1
30.9
44.2
35.7
19.0
18.6
2026Q2
35.8
54.2
44.9
30.1
16.5
Capex ÷ operating cash flow, last four quarters (%)Above 100% means spending beyond what the business brings in.