The AI Economy Hit $110 Billion — and It's Growing 3x Faster Than the Internet
Azeem Azhar's Exponential View team has published the first comprehensive analysis that rebuilds the generative-AI economy "from the bottom up." Once double-counting is stripped out, the picture is clear: AI generated $110 billion in revenue over the past 12 months, running at a $175 billion annualized rate based on the latest month.
In brief
- Growth: AI revenue is growing roughly 3x faster than the mobile or internet waves.
- A fragile balance: the hyperscalers' (Google, Microsoft, Amazon) AI infrastructure revenues only just clear their depreciation expense — economics that are "borderline sustainable." (The math assumes 6-year depreciation for compute, 14 years for other infrastructure.)
- Price elasticity: every 10% price cut raises token consumption by 12–18%; even as per-token prices fall, total spending rises.
- Executive pressure: half of the CEOs surveyed believe their job depends on getting their AI strategy right.
Our take
The numbers are striking, but the real message is in the balance: AI revenue is growing at record speed, yet it still only barely covers the depreciation on a massive infrastructure build-out. That makes this economy's sustainability dependent on demand continuing to outstrip available compute. One telling detail is the price-demand link: as tokens get cheaper, total spending goes up — a sign the market still has plenty of room to grow. And beneath it all sits the pressure half of CEOs report feeling: AI is no longer something to experiment with, but a strategy they're expected to execute well.
Kaynak: Exponential View