The AI boom’s quiet second act
The AI boom hasn’t just lifted chipmakers and software giants. It’s quietly reshaping the physical economy underneath them, and that’s where Bank of America sees the next opportunity taking shape.
Instead of chasing companies that build AI, the bank is pointing to “transition” stocks: businesses tied to the energy, materials, and infrastructure needed to support AI’s growth. These aren’t flashy names, but they sit at the center of a buildout already underway.
The math is straightforward. AI runs on data centers, and data centers run on power. According to The Economist, U.S. data centers are on track to consume nearly 10% of the country’s electricity by 2030 - about four times China’s share today.
Transition, not AI
Bank of America argues the next growth story may come from sectors that benefit indirectly from AI, rather than AI itself:
- Infrastructure, as power grids, transmission lines, and power systems, expand
- Defense, as governments invest in energy security and supply chains
- Industrial metals, including copper, aluminum, nickel, and silver
These areas don’t rise or fall on tech hype. They’re driven by long-term demand that keeps building even when tech stocks wobble.
Why this trade looks different
Bank of America says about $40 billion flowed into defense, infrastructure, and transition-related stocks last year. That trend is reinforced by more than $1 trillion in global commitments tied to national security, energy, and supply-chain investment.
The bottom line: The AI story isn’t over, but it’s spreading out. As attention stays locked on chips and software, Bank of America sees quieter momentum building in the real-world systems that make the AI boom possible in the first place.