BofA Expert Warns AI Boom Needs 'More Land' Than Singapore,' More Energy' Than Japan,' As Growth Faces Massive Bottleneck
The burgeoning artificial intelligence revolution, while promising unprecedented advancements, is on a collision course with global infrastructure limitations, according to Haim Israel, Managing Director and Head of Global Thematic Research at Bank of America.
AI Revolution’s ‘Warp Speed’ Growth Faces Massive Bottleneck
Israel, in a conversation with CNBC International, warned that the rapid expansion of AI necessitates a dramatic increase in data center capacity, estimating a 50% growth requirement in the coming year alone.
This expansion, he states, would demand a land mass greater than Singapore and an energy output exceeding that of Japan, creating a significant bottleneck for AI’s projected “warp-speed” development.
BofA Says AI Is ‘So Much Bigger’ Than ChatGPT
He also emphasized that the current focus on AI’s superficial applications, like email summarization or presentation generation, misses the technology’s true, transformative potential.
“AI is so much bigger,” he asserted, highlighting its capacity for groundbreaking simulations in drug discovery, climate modeling, food consumption, and the creation of new materials.
He critiques the industry’s obsession with quarterly numbers and small-scale applications, urging a broader perspective on AI’s profound societal impact.
See Also: Elon Musk Touts Solar As ‘Biggest Source of Power’ As AI Industry Scrambles For Energy Solutions
AI’s Need For Natural Resources Is Increasing
However, this grand vision is tempered by practical constraints. Israel reiterated previous concerns about unprepared energy infrastructure.
Beyond land and power, the AI boom presents other under-discussed demands, such as water, where 40 commands on an application like ChatGPT or Gemini consume a liter.
With billions of commands daily, the need for natural resources is escalating rapidly.
“This revolution is happening so fast… we do need so much more resources,” Israel stated, stressing the urgent need to balance technological progress with sustainable energy generation strategies.
Quantum Technology Arriving Sooner Than Expected
Looking ahead, Israel also touched upon the “Q Day”—the moment quantum computing surpasses classical computers—which he believes is arriving sooner than anticipated.
He described quantum computing as “one of the most radical technologies we’ve ever seen,” capable of calculations that would take classical computers eons.
This next frontier, while not replacing classical systems, will further intensify demand for computational resources, underscoring the ongoing challenge of building out the necessary global infrastructure to support these accelerating technological revolutions.
Here are a few AI-linked and quantum stocks and ETFs that investors could consider on growing demand.
| ETF Name | YTD Performance | One Year Performance |
| iShares US Technology ETF (NYSE:IYW) | 24.17% | 24.17% |
| Fidelity MSCI Information Technology Index ETF (NYSE:FTEC) | 21.29% | 22.10% |
| First Trust Dow Jones Internet Index Fund (NYSE:FDN) | 11.02% | 14.40% |
| iShares Expanded Tech Sector ETF (NYSE:IGM) | 24.70% | 26.18% |
| iShares Global Tech ETF (NYSE:IXN) | 24.22% | 25.62% |
| Roundhill Magnificent Seven ETF (BATS:MAGS) | 19.65% | 25.92% |
| Stocks | YTD Performance | One Year Performance |
| Rigetti Computing Inc (NASDAQ:RGTI) | 26.00% | 1525.81% |
| Quantum Computing Inc (NASDAQ:QUBT) | -46.54% | 127.95% |
| D-Wave Quantum Inc (NYSE:QBTS) | 143.39% | 1150.80% |
| International Business Machines Corp. (NYSE:IBM) | 38.61% | 45.87% |
| IonQ Inc (NYSE:IONQ) | 5.34% | 73.55% |
| Defiance Quantum ETF (NASDAQ:QTUM) | 29.55% | 62.35% |
The futures of the S&P 500, Dow Jones, and Nasdaq 100 indices were mixed on Friday after a sharp fall on Thursday.
Read Next:
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Image via Shutterstock