I joined Nadine Blayney on Ausbiz today to discuss why I remain cautious on the artificial intelligence (AI) investment theme, despite strong earnings from the major technology companies. While reported profits continue to rise, I argued that much of the spending on AI infrastructure is being treated as capital expenditure rather than an expense, making earnings appear stronger than underlying cash flows. I also suggested that today’s relatively modest price-to-earnings (P/E) ratios may not tell the full story, noting that markets can still suffer significant declines even from low valuations if earnings prove unsustainable. Ultimately, I believe the key risk is not that AI share prices are too high, but that investor expectations for future earnings may be too optimistic.

Tune in via Ausbiz here: The reason Roger reckons AI is a “bubble”

Disclaimer:

The Montgomery Small Companies Fund, The Montgomery [Private] Fund, The Montgomery Fund, and the Australian Eagle Equities Fund own shares in Megaport. This video was prepared 25 June 2026 with the information we have today, and our view may change. It does not constitute formal advice or professional investment advice. If you wish to trade this company you should seek financial advice.