Goldman Sachs: AI spending spree will trigger wave of new stock sales

Companies are set to issue more shares to fund their artificial intelligence ambitions, but a simultaneous boom in stock buybacks will soften the blow for investors, according to Goldman Sachs. The bank’s strategists said the surge in AI-related capital spending—on data centers, chips, and energy—will push corporations to raise fresh equity. That means more supply of new shares in the market, which can pressure stock prices. However, Goldman Sachs expects this effect to be “cushioned” by companies repurchasing their own shares. Buybacks, it noted, tend to support share prices by reducing the number of shares available. The note, titled “AI investment will fuel more equity issuance, while buybacks cushion effects,” argues that the two forces will largely offset each other. The result: a market that absorbs new stock without major disruption. For non-native speakers, the key takeaway is simple: AI costs money, companies will sell new shares to get it, and they will also buy back old ones to keep prices steady. Goldman sees a balanced outcome, not a crash.