One Winner, Own the Tolls
Saad Rizvi@saadrizvi
−7.2%
since Oct 1
The idea
I believe the AI supercycle ends with one dominant winner, but I have no idea who it'll be, so I'm not guessing. Most of this basket owns the tolls every contender has to pay along the way: chips, the machines that make them, memory, networking, and power. A smaller slice holds the handful of companies with the money and distribution to plausibly end up on top, so whoever wins is already in here somewhere. I'm keeping a small cash buffer, avoiding single-name bets, and holding this for years to let the sorting play out.
What it owns
- A spread across the plausible winners ensures the take owns a piece of whoever emerges as the single dominant platform for AI. · Microsoft CorporationIt has deep partnerships for AI models, the Azure cloud platform, and software distribution into nearly every enterprise, positioning it as a plausible winner in the race., Alphabet Inc.It owns the full stack of custom chips, large language models, cloud infrastructure, and billions of users to deploy AI against, making it a credible contender for dominance., Amazon.comIt operates the largest cloud infrastructure, has its own AI chip program, and holds a significant stake in Anthropic, making it a contender if cloud rental becomes the winning business model., Meta PlatformsIt is spending heavily on AI models and has billions of daily active users, positioning itself as a contender if open models and distribution prove decisive.25%
- Chipmakers earn revenue from all competing platforms, making their earnings independent of any single winner in the market. · NVIDIA CorporationIt supplies the chips at the core of every contender's AI infrastructure, collecting a toll as long as capital spending on advanced training and inference hardware keeps flowing., Taiwan Semiconductor ManufacturingIt manufactures nearly every advanced AI chip, including NVIDIA's, so it collects a toll on the entire AI supercycle regardless of which contender pulls ahead., Broadcom Inc.It supplies custom chip designs to contenders trying to reduce their dependence on NVIDIA, collecting a toll from the hedging even if those in-house efforts never fully succeed.24%
- Every contender's data centers consume enormous amounts of electricity and generate heat that must be managed, creating a growing toll independent of who wins. · Vertiv HoldingsIt provides the cooling and power infrastructure every new AI data center requires, ensuring it collects a toll regardless of which contender dominates., GE VernovaIt supplies turbines and grid equipment to add the generation and transmission capacity that AI data centers demand, collecting a toll on the power shortage., Eaton CorporationIt makes the electrical distribution equipment that moves power from grid to data center racks, collecting a toll on every facility regardless of whose chips are inside., Constellation EnergyIt owns the largest US nuclear fleet and benefits as contenders sign long-term power deals to secure the reliable electricity AI data centers require at scale.18%
- AI data centers require specialized high-bandwidth memory and networking equipment in massive volumes, a toll paid by whoever builds the largest clusters. · Micron TechnologyIt makes high-bandwidth memory essential for AI chips, and with only three suppliers globally, it holds pricing power as AI demand outpaces capacity., Arista NetworksIt supplies the switches that wire together massive training clusters, collecting a toll as long as contenders keep building larger AI infrastructure., Marvell TechnologyIt supplies the interconnect technology that moves data inside and between AI data centers, collecting a toll on cluster expansion independent of the winner.15%
- The machines that manufacture advanced chips are the deepest bottleneck in the AI supercycle; no contender can scale without them. · ASML HoldingIt is the sole supplier of extreme ultraviolet lithography machines needed to print the most advanced chips, so every new fab built for AI pays this toll., Applied MaterialsIt supplies the equipment used to build new fabrication plants, ensuring it collects a toll as long as chipmakers keep expanding capacity for AI chips.10%
- Cash8%