Why Nvidia Could Be the Biggest Tech Winner of the 'One Big Beautiful Bill'

Earlier this month, Nvidia became the first company in history to be valued at $4 trillion, a figure that could look paltry in coming years if the recently enacted One Big Beautiful Bill Act is the tailwind some on Wall Street think it could be. 

The bill, signed into law by President Donald Trump on July 4, allows the immediate depreciation of capital investments that previously were written off over years. Morgan Stanley expects that and related depreciation changes to raise Amazon (AMZN), Alphabet (GOOGL), and Meta Platforms’ (META) collective free cash flows by nearly $49.5 billion this year and about $29.2 billion in 2026. Analysts expect the tech giants will invest those savings in infrastructure as they race to meet booming demand for artificial intelligence and cloud computing. 

“In our view these tax benefits could be designed to incentivize/enable the leading US tech companies to invest even more aggressively in GenAI in order to keep the US in a secure position in the global GenAI race,” wrote Morgan Stanley analyst Brian Nowak in a note on Sunday.

AI Investment ‘Yet To Hit Full Stride’

Hyperscalers Microsoft, Amazon, Alphabet, and Meta have cumulatively spent hundreds of billions of dollars on AI infrastructure in the past few years. Yet executives repeatedly have said their cloud computing and AI businesses cannot keep up with demand. The ability to deduct AI investments in the year they’re made will likely incentivize tech giants to increase those investments, both to increase computing capacity and to save on taxes.

Less than a month after OBBBA was passed, there already are signs that AI investment could pick up this year. Last week, Google’s parent, Alphabet, the first of the four hyperscalers to report second-quarter earnings, raised its capital expenditures forecast by $10 billion, or about 13%. That, according to Morgan Stanley analyst Joseph Moore, is evidence that “demand for GPUs has yet to hit full stride in 2025.”

Nvidia Expected To Retain Majority of AI Spend

Nvidia has been the biggest beneficiary of AI investment. The chip maker’s quarterly revenue has more than quintupled in the last two years, reaching a record $44 billion in the first quarter of the current fiscal year.

Nvidia’s chips are one of the largest expenses for tech giants building data centers, and the company’s share of the fast-growing pie is expected to get bigger in the coming years. BofA forecasts AI accelerators will account for more than 65% of all data center spending by 2030, up from about 38% in 2024. And Nvidia is expected to command about 80% market share over that period.